INDUSTRIAL RELATIONS ACTS, 1946 TO 2004
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
CORK PLASTICS LTD.
(REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION)
- AND -
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
Chairman: Mr Duffy
Employer Member: Mr Doherty
Worker Member: Mr Nash
1. Application of Bonus Scheme
2. This case concerns a dispute between Cork Plastics Ltd and SIPTU in relation to the terms applicable to and the operation of the Company bonus scheme. The Union is claiming that the scheme is not operating in line with proposals previously agreed between the parties.
It contends that a performance level of 90 British Standard Institute (BSI) should be enough to attain the agreed bonus which is more appropriate than measuring performance by tonnage, although this is not currently the case, as management have taken into account factors such as absenteeism, downtime, scrappage production, annual leave, tonnage output etc. The Union also contends that the scheme should be based on individual performance. Management's position is that the scheme was always intended to be a group scheme as individual schemes would be impossible to operate and that measuring performance through tonnage is the fairest way in relation to the application of the scheme.
The dispute could not be resolved at local level and was the subject of a number of conciliation conferences under the auspices of the Labour Relations Commission. As agreement was not reached, the matter was referred to the Labour Court on 18th July, 2006, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on 4th April, 2007, the earliest date suitable to the parties.
3 1 The bonus scheme as currently operates is unfair to the workers on the basis that it is a group scheme as opposed to a more transparent individual scheme. Payment is being made on tonnage as opposed to the Unions understanding that it would be based on BSI.
2 Management have included factors in relation to the calculation of the bonus that have not been previously agreed with the Union.
3 The scheme should also allow for issues such as breakdown, bad product and tool changes, which are not the responsibility of the operator.
4 Operators should also be able to know what bonus had been achieved at the end of each shift.
4 1 It would be impossible to operate an individual bonus scheme in this area as the nature of the work involves co-operation and varying work across the product range.
2 High levels of absenteeism and other issues will undoubtedly affect the standards reached and subsequent payments within the scheme.
3 Allowances are made in the calculation of perfromance levels to allow for scrap/ bad product to be dealt with.
4 The Company has continually applied fairness and transparency in the application of the bonus scheme to all workers concerned.
It is clear to the Court that serious issues exist in relation to the terms and the operation of the bonus scheme. It is apparent that the Union and the Company are notad idemon the original terms agreed for the operation of the scheme and it appears that workers operating within the scheme do not have a full understanding of how performances are calculated and bonus results produced.
The Court notes that the Union's Industrial Engineer prepared a report on the scheme on 28th Sepember 2005. It appears that the matters raised in that report have not been fully addressed in the interim.
The Court recommends that the parties should have immediate discussions, involving Industrial Engineers on each side, to address the matters raised in the Union's report of September 2005 and other relevant issues concerning the operation of the scheme. In these discussions the parties should have full regard to the need to operate the scheme in a fair and transparent fashion within the original terms agreed.
If agreement is not reached within three months the matter may be referred back to the Court.
Signed on behalf of the Labour Court
3rd May 2007______________________
Enquiries concerning this Recommendation should be addressed to Andrew Heavey, Court Secretary.