FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : CONNACHT GOLD CO-OPERATIVE SOCIETY (REPRESENTED BY IBEC) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Mr Doherty Worker Member: Mr Nash |
1. Pay reduction.
BACKGROUND:
2. The case concerns a dispute between Connacht Gold Co-operative Society (represented by IBEC) and SIPTU in relation to a claim by the employer to introduce a pay reduction within the Company. Management's position is that due to difficult trading circumstances and the current economic climate it must introduce pay reductions.
Management states that it has secured agreement with almost two thirds of staff in the organisation (Dairy Executive Association members and non union staff members), yet is in dispute with SIPTU in relation to the reductions.
The Union's position is that Management had already approached other staff and had already reached agreement on the pay reduction prior to consulting with its members. The Union contends that Management has unilateraly introduced a pay reduction contrary to the way the parties have conducted negotiations in the past.
The dispute was not 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 matter was referred to the Labour Court on the 26th January, 2010, in accordance with Section 26(1) of the Industrial Relations Act, 1990.
A Labour Court hearing took place on the 18th May, 2010, in Sligo.
COMPANY'S ARGUMENTS:
3. 1. Due to difficult trading circumstances and the economic downturn the Company must introduce cost saving measures to remain viable and protect employment into the future.
2. Agreement has already been reached with almost two thirds of the staff in the Company in relation to the reduction in pay.
UNION'S ARGUMENTS:
4. 1. Management has unilateraly imposed pay cuts within the organisation without consultation with the Union in relation to its members' pay. This is unacceptable and at variance with established negotiating structures within the Company.
2. Management unilaterally cut pay of its workers without agreement, which is in clear breach of contract and is therefore, illegal.
3. The Union had proposed alternative contributions to the Company rather than having pay reductions imposed. These proposals would have assisted in the continued viability of the Company and could have been been repaid at a future date. These proposals were not considered by management
RECOMMENDATION:
The Court regards the Company’s decision to reduce pay unilaterally, in respect of those associated with this claim, without resorting to and exhausting agreed dispute resolution procedures as unhelpful.
While every case must be decided on its own facts, in general, the Court could only recommend reductions in pay where there is a demonstrable and compelling need for such reductions in order to maintain the viability of an enterprise and the employment which it provides.
In the present case the Court is not satisfied that the Company has made sufficient efforts to convince the Union of the need for the cuts in issue. Nor has the Court been provided with sufficient information concerning the financial circumstances of the Company on which reliance is placed in justifying these reductions.
The Court recommends that the Company should now provide the Union with all necessary information upon which it relies in justification of the reductions. The Company should also facilitate an independent evaluation of that information.
That exercise should commence immediately following acceptance of this recommendation and should be completed within two months. If agreement is not reached that matter should be referred back to the Court for a definitive recommendation on all issues in dispute. The Court will facilitate the parties with the earliest possible hearing.
Signed on behalf of the Labour Court
Kevin Duffy
3rd June, 2010.______________________
AH.Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Andrew Heavey, Court Secretary.