INDUSTRIAL RELATIONS ACTS, 1946 TO 2004
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
ALEXON INTERNATIONAL LIMITED
- AND -
Chairman: Mr McGee
Employer Member: Mr Grier
Worker Member: Ms Ni Mhurchu
1. Introduction of Christmas Bonus.
2. The Company is part of the Alexon Group plc, a UK based Company who operate in the Ladies Clothing sector and trades under a number of brands in retail stores nation wide. The Union's claim submitted in March, 2004, on behalf of approximately twenty workers is for the introduction of a Christmas Bonus. Following discussions between the parties the Company put forward a draft proposal in April, 2005 which linked the bonus to performance and would be non-contractual. The proposal was rejected by the Union which is seeking that the Christmas Bonus form part of the terms and conditions of staff in the Company. The dispute was referred to the Labour Relations Commission. A conciliation conference was held but agreement was not reached. The dispute was referred to the Labour Court on the 8th March, 2006 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Court hearing was held on the 21st June, 2006.
3. 1. The payment of a Christmas Bonus is normal in the Retail Trade in Ireland and is enjoyed by the majority of workers. It has come about by agreement and, therefore, forms part of workers terms and conditions of employment, in other words it is contractual.
2. The Payment of Wages Act, 1991 includes bonus in its definition of wages. In a recent case before the Employment Appeals Tribunal the Employer argued that the Christmas Bonus was benefit in kind but the Tribunal determined that a bonus is in fact wages (PW44/2005 refers). The logic of this is that payment of a bonus is also contractual.
3. The Union has endeavoured to meet the concerns of the Company, however the Company has attached prohibitive conditions and this proved an obstacle to have an agreement in place by Christmas, 2005. Workers should be compensated for the loss they suffered in 2005, particularly having regard to the fact that the claim originated in early 2004.
4. 1. The Company wrote to the Union on 30th June, 2005 offering to amend its proposal in relation to the qualifying length of service and to review the link between sick absence and the bonus payment, also the question of the disciplinary procedure issue could be dealt with on a case by case basis provided the bonus remained non-contractual. The Company cannot financially fund a bonus that is not linked to performance. The Company also reserves the right to retain the bonus.
2. The Company is facing its most difficult trading situation for many years (Details supplied to the Court).
The Court has considered the progress made to date between both parties and notes from correspondence and advice to the Court that there is an agreement in principle to pay Christmas bonus.
The Court does recognise the right of any company to consider a variety of factors which may be taken into consideration before a staff bonus payment can be sanctioned.
However, it is also recognised that in the retail trade in Ireland, it is an industrial relations norm that retail sales staff in multi-unit outlets would normally enjoy a Christmas bonus.
In this instance the Court recommends that a Christms bonus, subject to a waiting period and pro-rata deduction for long-term sick leave, should be paid with effect from December, 2006, but cannot accede to the Union's claim for a bonus in 2005.
Signed on behalf of the Labour Court
30th June, 2006
Enquiries concerning this Recommendation should be addressed to Tom O'Dea, Court Secretary.