INDUSTRIAL RELATIONS ACTS, 1946 TO 2004
S2(1), INDUSTRIAL RELATIONS (AMENDMENT) ACT, 2001,
AS AMENDED BY THE INDUSTRIAL RELATIONS(MISCELLANEOUS PROVISIONS) ACT, 2004
METROPLEX IRELAND LIMITED
- AND -
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
Chairman: Mr McGee
Employer Member: Mr Murphy
Worker Member: Ms Ni Mhurchu
1. Referral from the Labour Relations Commission under the Industrial Relations (Amendment) Act, 2001, as amended by the Industrial Relations (Miscellaneous Provisions) Act, 2004.
2. The Company is involved in the supply of food and other products used by consumers in all McDonalds outlets nationwide. The issues in dispute, which concern a number of workers who are Union members, are as follows:
Grievance and Disciplinary Procedure;
Sick Pay Scheme;
The Company's response to the Union's request for a meeting to discuss those issues is that it deals directly with its workers and does not negotiate with unions. The Union referred the issues to the Advisory Service of the Labour Relations Commission under the provisions of the Enhanced Code of Practice on Voluntary Disputes Resolution (S.I. 76 of 2004). Both parties participated in this process but agreement was not reached. The dispute was referred to the Labour Court in accordance with Section 2 (1) of the Industrial Relations (Amendment) Act, 2001, as amended by the Industrial Relations (Miscellaneous Provisions) Act, 2004. A Court hearing was held on the 3rd November, 2005.
3. 1.Grievance and Disciplinary Procedure.The Union is seeking a revision of the Grievance and Disciplinary Procedures as expressed in the Company's Handbook to meet full compliance with the provisions of the Code of Practice on Grievance and Disciplinary Procedure (S.I. 146 of 2000).
2.Shift Premium.The Union is seeking an increase in the Shift Premium applicable to Warehouse General Operatives. The current payment by the Company of €42.86 on three week cycle is out of line with rates applicable to similar shift working in the Warehousing and Logistics/ Distribution Sector.
3.Sick Pay Scheme. The absence of a Sick Pay Scheme is out of line with similar workers in theWarehousing and Logistics/ Distribution Sector. The Union is seeking a scheme on behalf of General Operatives, Supervisors and Technicians which is service-related and will operate as follows:
six months- two years ten working days
two-four years twenty working days
four-six years thirty working days
six-eight years forty working days
eight-ten years fifty working days
ten+ years sixty working days
4.Service Leave.The Union is seeking an agreed Service Leave Scheme on behalf of General Operatives, Supervisors and Technicians as follows:
four years one day plus annual leave entitlement of twenty days
eight years two days plus annual leave entitlement of twenty days
twelve years three days plus annual leave entitlement of twenty days
sixteen years four days plus annual leave entitlement of twenty days
twenty years five days plus annual leave entitlement of twenty days
5.Maintenance Manager.The Union is seeking the following in respect of this worker:
(a) Call -out allowance and a stand-by /on-call allowance should be established in respect of the Claimant. At present there is no transparency of pay structure.
(b) The Claimant is seeking a minimum payment of four hours for call-out and a % increase for on-call provision in his contract.
(c) A compensation payment for on-call duties already covered by the Claimant and on-call provision in his contract. The claimant's records show that he has worked 167 call out hours to date.
(d) Provision of a credible bonus for savings accrued and performance targets achieved by this employee. The Claimant was promised a bonus payment of €1,000 every six months.
(e) Clear transparency as to his pay structure including call out/on call and Bank Holiday Pay.
(f) Inclusion in provisions of National Agreements. Failing that in an annual review, an increase of no less than the annualised equivalent in a National or Local Agreement.
6.Supervisors.Salary levels for Supervisors are individual and addressed by way of review. There is no transparency of pay structure and the Claimants have sought a breakdown of salary. They are excluded from the application of National Wage Agreements as they apply to other workers. They are seeking a guarantee that pay reviews be annual and that awards made should amount to no less than the annual equivalent of a National or Local Pay Agreement.(LCR 17933 is relevant). These workers are seeking that all Bank Holidays worked beyond three be paid at treble time. They are seeking payment for additional hours of work at appropriate rates, currently applicable to other categories of employees. The stated benefit of time off in lieu has not been consistently realised and is often impractical. The Claimants believe they are being unfairly treated by the Company's insistence that the Night Shift Premium is already included and point to a comparison with Warehouse Operatives (ten years service). The Claimants are seeking an increase in their salaries to more fairly reflect the scope of their hours and ongoing commitment to night shift. In relation to holidays the Claimants believe that their holiday entitlement should reflect their longer working week as per their contract of employment and claim that the application of the statutory entitlement to give them the eight hour difference per week does not reflect this. They are seeking an increase of annual leave entitlement by 15% i.e. three additional days.
4. 1.Grievance and Disciplinary Procedure.The Company Handbook provides that a "fellow employee" can attend at a disciplinary meeting for the purposes of acting as a witness or to speak on behalf of a fellow employee at all stages of the formal disciplinary process. The Company believes that this complies with S.I. 146 of 2000.
2.Shift Premium.Currently the Company operates a shift system as follows:
6.00a.m. to 2.15 p.m.
10.00a.m. to 6.15 p.m.
3.00 p.m. to 11.00 p.m.
7.00 p.m. to 3.15 a.m.
Snowcrest Services (the predecessor of the Company) worked a three -shift system as follows:
7.a.m. to 3.00p.m.
3.00 p.m. to 11p.m.
11.p.m. to 7.00a.m.
Snowcrest Services did not work on Sundays. When the Company introduced Sunday working it introduced a 30% shift premium which was subsequently increased to 50% (in line with an increase provided to transport employees in the Company). After discussions with the Warehouse Committee the 7.00p.m.-3.15a.m. shift was increased to €8 per day. This is the only shift which attracts a premium currently. The Company believes that its salary package is adequate for the type of shift patterns which it works and compares very favourably to competitors.
3.Sick Pay. The Company operates a discretionary sick pay scheme for its warehouse employees. Rather than allocating a number of paid sick days the Company prefers to take the approach of rewarding employees for constant attendance rather than paying employees sick pay when they are absent from work. For hourly paid warehouse employees, if they are absent for less than five days in a year then they receive a bonus of one week's salary at year end. The Company has a very low rate of absenteeism and believes that the introduction of a sick pay scheme for hourly paid employees would jeopardise the attendance rate where absence is currently running at an average of 1.23% for the years 2002-2004.
4.Annual and Service Leave.Currently the holiday entitlement for supervisors is 16 days relating to 4 weekly shifts and 20 days for all other employees. The Company believes that such a holiday entitlement is consistent with its statutory obligations under the Organisation of Working Time Act, 1997. Its holiday leave entitlement is consistent with industry norms. While the Company does not provide service leave it does recognise service by providing warehouse employees with payments of €8.93 per week for 1-3 years' service. €17.85 per week for 3-5 years' service and €27.59 for 6 years' service. These rates are €10.01, €19.45 and €29.17 respectively for team leaders. The Company cannot afford to put a provision for service leave in place and does not believe that such a scheme is the norm in its industry sector.
5.Maintenance Manager. The Claimant's employment contract clearly indicated that any time for which he would be called out was included in his normal hours of work. It was explained to the claimant at the time that all managers in the Company (which included the claimant) received a base salary to compensate them for all work required of them to get the job done. The Claimant was given the benefit of a fully- expensed company vehicle in order to assist him in dealing with call outs in recognition that call outs were to be an integral part of his job. The number of call outs which he claimant is now required to attend is low but despite the reduction in the call outs attended by the Claimant his base salary has not been reduced commensurate with the reduction in call- outs. Because the call -out allowance is included in base salary the end result for the Claimant is that any annual pay increase, pension, etc. is calculated on his base salary which is more advantageous to him than a flat call out allowance. The Company rejects the Union's claim that the Claimant was promised a bonus payment of €1,000 every six months. The Claimant has received in excess of the increases provided for in the national pay agreements i.e. an increase of 37.66% compared with a figure of 24% (compounded) provided for in the national pay agreements in the same period.
6.Supervisors.( i) Pay. The Company believes that its remunerative package for supervisors compares favourably with other companies in the same industry based on its benchmarking. These employees are treated as members of management and in accordance with their status within the Company are dealt with on an individual basis. Employees in this category are not excluded from national pay agreements.
(ii) Bank Holidays. There are nine public holidays provided for under the provisions of the Organisation of Working Time Act, 1997. Of these the Company does not open on Christmas Day and closes part of the day Christmas Eve and part of New Years Eve as agreed time in lieu. This leaves seven public holidays of which an employee is obliged to work an average of three and a half days. Of these, three days are paid for in the employees' salary. The Company is prepared to pay employees for the outstanding 1/2 days on a retrospective basis since 2001. In order to resolve any confusion which might arise from this arrangement, the Company is willing to leave the current arrangement run and at the end of each year to carry out a reconciliation in respect of the days of public holidays actually worked by the employee at the end of the year and to pay the employee for any shortfall and recover from any employee any overpayments. Alternatively, the Company is prepared to remove pay for public holidays from base pay completely and to pay employees for public holidays which they actually work.
(iii) Additional hours of work. Supervisors get paid base pay for any hours of overtime worked by them. They can still choose to take time in lieu of overtime worked but they have never requested that overtime be provided to them in this manner. The Company believes that as members of management, an arrangement of this nature is the norm. There is no statutory obligation to pay overtime at a premium rate.
(iv) Night Shift Premium. Supervisors are paid their salary, which takes into account that their job requires them to rotate between days and nights This arrangement was put in place in 1999 following consultation with supervisors. At that time the supervisors were on a three shift-rolling pattern and they moved to a fixed shift. The base salary of supervisors in the Company demonstrates that they are in receipt of a differential of 25% in relation to the warehouse operatives.
(v) Holidays. The Company provides for a 23-day holiday entitlement for warehouse supervisors which is over and above that provided for under the Organisation of Working Time Act, 1997, and the annual leave entitlement of 20 days provided to warehouse operatives.
Preliminary Points on Jurisdiction:
Section 2 of the Industrial Relations (Amendment) Act, 2001 as amended by the Industrial Relations (Miscellaneous Provisions) Act, 2004 states that the Labour Court can investigate a trade dispute where (inter alia)
“it is not the practice of the employer to engage in collective bargaining negotiations in respect of the grade, group or category of workers who are party to the trade disputeand the internal dispute resolution procedures (if any) normally used by the parties have failed to resolve the dispute”
The Company argues that in relation to two issues (Sick Pay Scheme and On-Call Payments) there had either been no discussions at all (Sick Pay) or only partial use of the Company’s grievance procedure (On-Call). The Company therefore argues that the internal dispute procedures normally used by the parties have not failed to resolve the dispute because they have either not been used at all or have not been fully utilised. There is in existence a warehouse committee, which the Company regards as a dispute mechanism "normally used" by the parties.
The underlined clause relied on by the Company contains three essential requirements which must be satisfied:- (a) there must be a disputes procedure; (b) it must normally be used by the parties to the dispute; and (c) it must have failed to resolve the dispute.There is no evidence before the Court which would indicate that the workers who are party to this dispute regard or have ever regarded either the grievance procedure or the Warehouse Committee as providing a procedure for resolving disputes, as contended by the Company. On the contrary, they have, instead, requested SIPTU to negotiate with Management on their behalf. From the description given by the Company of the Warehouse Committee, it is clear to the Court that it is a creature of the Management, whereby requests are put by the workers and considered by management. The Court therefore does not find that there is in place a "dispute resolution body" as that term is normally understood in the context of industrial relations.Similarly, a "grievance procedure" is not a dispute resolution body as normally understood in the context of industrial relations.As the parties to the instant dispute are the Company and those of its workers who are represented by SIPTU, and as the Company refuses to recognise a trade union and has consistently refused to meet with SIPTU, it therefore follows that no procedure for resolving disputes exists which is normally used by the parties to the instant dispute.The Court therefore finds that the relevant provisions of Section 2(1)(a) of the 2001 Act have been satisfied and that the matters are properly before it.The Company also alleges that Section 2 above excludes disputes which relate to individual employees and that this would therefore exclude the aspects of SIPTU’s claim, which relate to one individual.
Section 2 of the Act says (inter alia)
- “it is not the practice of the employer to engage in collective bargaining negotiations in respect of the grade, group or category of workers who are party to the trade dispute”
It is also contended by the Company that the above-mentioned individual had entered into the first stage of the Company’s grievance procedures by raising his claims with Management. SIPTU’s response is that this member of the group simply raised the matters informally with the Company and after getting no positive response, involved his trade union. It is not the view of the Court that this constitutes a "normally used dispute resolution procedure". The Court therefore finds that the claims involving this worker, who is part of the Group, are properly before it under Section 2 of the 2001 Act.
Revision of Grievance and Disciplinary Procedures as set out in the Company’s Handbook to comply with the Code of Practice on Grievance and Disciplinary Procedures (S.I. 146 of 2000).
The Court notes the Company’s contention that this issue was not raised at the parties’ meeting with the LRC Advisory Service. The Court, however, having examined the report of the Advisory Officer, is satisfied that the matter was indeed raised and is therefore validly before the Court for consideration.
The Union claimed that the current internal procedures for the processing of issues relating to individual grievance and disciplinary matters were inadequate in that they do not provide for representation of employees by a trade union in appropriate cases.
It is clear from an examination of the Employee Handbook that the matter of representation at all levels of the process is not dealt with in a manner compliant with the Code of Practice S.I. 146/2000. The Court does not agree that the provision to allow " a fellow employee” to attend a disciplinary meeting “to act as a witness” meets the requirements of S.I. 146/2000.
The Court recommends that the employer put in place a disciplinary and grievance procedure which conforms with the general provisions of the Code of Practice on Grievance and Disciplinary Procedures (S.I. 146 of 2000) and in particular that appropriate provision be made for representation by an employee as provided for in paragraph 4.4 of the Code.
Any dispute on this issue should be processed through the procedures provided for in Section 43(1) of the Industrial Relations Act, 1990.
Shift Premiums for Warehouse Operatives:
The Court recommends that the shift premium, which currently averages 11%, should average 15% for operatives working 5/7 days on late night shifts, with effect from 1st April 2006.
Sick Pay Scheme:
A scheme should be put in place allowing for 4 weeks’ sick pay (less Social Welfare) per year, provided employees have completed one years' service. There should be no pay for the first 3 days of absence. This should not affect the existing attendance bonus, and should be brought in from 1st April, 2006.
Service Leave Scheme:
The Court does not intend to make any recommendations on this matter at this time.
The Court recommends as follows. The existing salary (as increased annually) should comprehend up to 30 hours of callout per calendar year. There should be a minimum of 4 hours’ pay for each callout over 30 hours per year. Callouts in excess of 4 hours should be paid for at overtime rates. The average of the bonus arrangements paid to warehouse operatives and supervisors should be paid to this worker on the same basis. Public Holiday entitlements should be applied in accordance with the terms of the Organisation of Working Time Act, 1997. The Court recommends a payment equivalent to 17.5 days' pay in compensation for Public Holidays worked since 2001. All payments and elements thereof should be appropriately indicated on payslips as per the Payment of Wages Act, 1991. All of the above should apply from 1st January, 2006.
The Court recommends as follows.
• The Court notes that the Company has, in general, implemented pay increases at or above the levels provided for in National Wage Agreements. This practice should continue
• Public Holidays to be dealt with in accordance with the Organisation of Working Time Act, 1997;
• All hours of work above 39 hours per week to be calculated at overtime rates, and
• An extra payment of 8% to apply to supervisors’ salaries to take account of 12-hour rotating shift (day/night) requirement
All the above should apply with effect from 1st January, 2006
Signed on behalf of the Labour Court
16th February, 2006______________________
Enquiries concerning this Recommendation should be addressed to Tom O'Dea, Court Secretary.