INDUSTRIAL RELATIONS ACTS, 1946 TO 2004
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
J DONOHOE LTD
- AND -
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
Chairman: Ms Jenkinson
Employer Member: Mr Doherty
Worker Member: Mr Nash
1. Inclusion of overtime and meal expenses in holiday pay.
2. The Company is located in Enniscorthy and manufactures and distributes a range of drink products. This dispute concerns a claim for the inclusion of meal allowance and regular overtime payments in holiday pay. The company have rejected the claim as cost increasing, in breach of Sustaining Progress and unaffordable.
The dispute could not be resolved at local level and was the subject of a conciliation conference under the auspices of the Labour Relations Commission. As agreement was not reached, the dispute was referred to the Labour Court on the 9th December, 2004 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 19th September, 2005.
3.1 In relation to subsistence/meal allowance, the Union argued that as a regular bonus or allowance, the meal allowance is part of reckonable earnings for the purpose of holiday calculations.
2. The meal allowance is paid to the drivers every day and equals a fixed amount. As the drivers are always away from base, it is always paid and therefore this weekly payment should apply on all annual leave and public holidays.
3. In relation to the overtime issue, the drivers in question work long hours driving and cover long distances. Part of the job is to complete the routes given, therefore it is not an option to return to base, overtime is part of the job.
4. In the four weeks annual leave or public holidays, there is a major and unfair drop in earnings for these drivers, this is regular, rostered and systematic overtime.
4.1 In order to continue to operate in this increasingly competitive market, the Company must reduce or maintain its cost of delivery, while still providing the best service we can to our customers.
2. The Company has subscribed to all National Agreements and implemented them in a timely manner. The current claim for additional overtime and subsistence payments is a cost increasing claim in contravention Section 1.5 of Sustaining Progress
3. The Organisation of the Working Time Act, 1997 specifically excludes overtime payments as a basis for calculation of holiday pay.
4. Due to the competitive situation in which the Company operates, they have requested a proposal from an experienced independent transport consultant to undertake a full review of both the existing and alternative transport arrangements.
5. The Company has long implemented a system which follows the Revenue guidelines as to the operation of the law in regard to such payments Any payment of a subsistence allowance when the receiver is not actually working away from base is precluded under the law.
The dispute before the Court concerns a claim for the inclusion of meal allowance and regular overtime payments in holiday pay. The Court has considered the written and oral submissions of both parties.
The meal allowance is paid to drivers on the basis of reimbursing them for the costs sustained when travelling away from base and on that basis is allowed as a tax free payment. The Court can see no merit in the claim for the inclusion of this payment in holiday pay and accordingly, rejects that aspect of the claim.
Having regard to the high level of overtime earnings relative to basic pay,the Union sought the inclusion of average overtime payments in holiday pay. The Company indicated that it was experiencing severe competitive pressures and was anxious to reduce the level of overtime. It referred to its intention to introduce a new method of payment based on targets being met. The Union has been similarly looking to reduce the level of overtime worked and has sought the introduction of some mechanism to reduce its current level.
The Court recommends that pending the introduction of a new method of payment for work completed by drivers, the Company should include a payment in holiday pay based on the average overtime earnings where the overtime worked is regular and rostered. This should apply from the current leave year. To assess whether the overtime worked is “regular and rostered”, the Court recommends that the parties should look at the overtime worked in the last two years, preceding the issue of this recommendation.
The Court so recommends.
Signed on behalf of the Labour Court
28th September, 2005______________________
Enquiries concerning this Recommendation should be addressed to Jackie Byrne, Court Secretary.