INDUSTRIAL RELATIONS ACTS, 1946 TO 2004
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
EXAMINER PUBLICATIONS (CORK) LTD
- AND -
NATIONAL UNION OF JOURNALISTS
Chairman: Ms Jenkinson
Employer Member: Mr Doherty
Worker Member: Mr O'Neill
1. 1. New Pay Agreement 2. Pension - Consolidation of Profit-Sharing Payment into Schemes.
- The NUJ is seeking to conclude an agreement on pay for three years 2006 – 2008 incorporating increases of 5% for 2006, 5% for 2007 and 5% for 2008. The increases sought were rejected by the Company which operates outside the National Pay Agreements. The Company offered:
- Annual increases of 4%, 4% and 4½ % from 1st January, 2006, 2007 and 2008 respectively;
- Profit Sharing Bonus will continue to be operated in accordance with the PSB formula
- The claim for pensionability of PSB is permanently withdrawn.
The NUJ has rejected these proposals, the other two Unions involved SIPTU and AMICUS accepted this offer and withdrew their claim.
The Union has both a defined contribution scheme (5% contribution by employers and 6% by employees – 70% of workforce) and a defined benefit scheme (30% of workforce – closed to new entrants some 12 years ago). The Union is seeking that the profit sharing component of pay (value €2,850 for 2005) be reckonable for pension purposes as it forms a significant component of pay. This was rejected by the Company due to the changing pensions environment and the high costs involved.
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 5th October, 2006 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 28th February, 2007.
3.1 Since 1990 the parent company of the Evening Echo and the Irish Examiner has overseen a massive reduction against inflation in the base-line salary of all its employees. Disputes in relation to salary increases are nothing new between Unions and the Examiner Group.
2. The Union were of the view that the current pay dispute will not be resolved until proper pay increases reflecting the national pay position in the country are achieved. There has been no acknowledgement by management of the latitude, flexibility and co-operation shown by workers over the past 15 years.
3. The Company through its restructuring process managed to turn the Company around to an extent which was not imaginable.
3. The Union is not against the Company making a profit, but has been given to understand that there would be a subsequent claw-back of the lost increases, after the Company had turned itself around.
4. Profit sharing has always been presented by the Company as a benefit to supplement percentage pay increases which have been less than the rate of inflation and national pay agreements. None of the staff have ever been convinced that these payments are anything other than a device to sweeten the bitter bill of low pay arrangements. Profit sharing appears on pay slips twice a year after which it has no more impact on salary levels. It does not carry over to the following year as an ongoing salary increase, has no impact on holiday pay, sick pay, overtime and, crucially no impact on pensions.
4.1The Company has a history of pay agreements for periods of 3-5 years since 1993 and would prefer a further agreement of this duration for reasons of predictability and continuity in business planning.
2. In the circumstances where pay terms of Towards 2016 have been applied by most of the Company's competitors, it is not feasible to incur a higher level of wage cost increase over the duration of the next EPCL pay agreement without putting the Company at a competitive disadvantage relative to its competition.
3. The level of increases claimed by the Union side is unjustified, excessive and out of line with the general level of increase provided for in Towards 2016.
4. Profit sharing bonus will continue to be paid in accordance with the agreed formula and goodwill normally demonstrated by the parties.
5.Management is not prepared under any circumstances to depart from the very basic and fundamental principle that pensions are based on basic pay.
6. Management has consistently stated that it could not and would not roll back the absolutely necessary changes agreed with all of the Unions during the mid nineties in order to support a viable business model for EPCL.
7. Management is requesting that the Court find in its favour a level of cost increase which doesn't put EPCL at a competitive disadvantage and that it upholds the critically important principle that Profit Sharing Bonus is not pensionable pay.
The Union submitted two claims before the Court:
-claim for a new pay agreement of 5% for 2006, 5% for 2007 and 5% for 2008, and
-pension consolidation of profit sharing payments into the defined benefit and the defined contributions pension schemes
The Company initially offered a pay agreement of 3% for 2006, 3% for 2007 and 3% for 2008; and rejected the claim for pensionability of profit sharing bonus payments. At the outset of the hearing it emerged that the Company had increased it pay offer and two other Unions involved with the Company had accepted this offer with certain conditions. The NUJ rejected the offer.
The details of the offer were as follows:
-3-year agreement with basic pay increases of 4%, 4% and 4.5% from 1st January, 2006, 2007 and 2008 respectively.
-Profit Sharing Bonus will continue to be operated in accordance with the PSB formula and the goodwill normally demonstrated by the parties.
-The claim for pensionability of PSB is permanently withdrawn.
The Court is of the view that these circumstances have overtaken events and this new offer on pay increases for 2006, 2007 and 2008 should be accepted by the NUJ on behalf of its members.
On the claim for pensionability of profit sharing payments, the Court is cognisant of the major funding implications concession of this claim would have on the Defined Benefit Pension Scheme and therefore does not recommend concession of this claim. However, the Court recommends that members of the Defined Contribution Pension Schemes should be given an option to make employee pension contributions on the profit sharing payments and where availed of, management should make the appropriate (5%) employer contributions.
The Court so recommends.
Signed on behalf of the Labour Court
Enquiries concerning this Recommendation should be addressed to Jackie Byrne, Court Secretary.