INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
DIAGEO - ST JAMES GATE
- AND -
TECHNICAL, ENGINEERING AND ELECTRICAL UNION
Chairman: Ms Jenkinson
Employer Member: Ms Cryan
Worker Member: Mr McCarthy
1. Pay & Performance
2. This case concerns a dispute between the Company and Union in relation to the interpretation of an Agreement concluded between the parties in 2012. The Union contends that on the basis of the 2012 Agreement, it should have been included in negotiations on the annual salary review. Management's position is that it conducts its salary review with the Guinness Staff Union (GSU) in line with the current Total Reward Framework Agreements and Arrangements (TRF) process which is in place since 2002. It further contends that the 2012 Agreement provides that the TEEU members could avail of the outcomes of the TRF process but that it would not be a direct party to the negotiations on the review.
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 4th July 2014 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on 13th August 2014.
3 1 The Union should have been involved in the negotiations on the Salary Review. It is party to the 2012 Agreement and had an expectation that it would be included in the process.
2 The Union is dissatisfied with the outcome of the TRF process as the salary review increases relate to basic pay only and does not reflect the shift work carried out by its members.
4 1 Management has operated in line with the provisions of the Diageo/TEEU Bonus and Reward Framework Agreement agreed between the parties in 2012 and has carried out its review in line with the TRF process. The process of negotiations on the salary review involves the Company and the GSU. The TEEU may avail of the outcomes but is not party to the negotiations.
2 While the TEEU is not directly involved in the salary review process, it is open to the Union to convey its position to the GSU and to have its interests brought to the attention of Management for consideration.
The issue referred to the Court concerns an interpretation of an Agreement made between the Company and TEEU in May 2012. The “Diageo/TEEU Bonus and Reward Framework Agreement”under the Heading“Salary Budget Determination”states:-
- “The salary budget will be determined by the current TRF process……
In the context of the overall salary budget, the TEEU will have a discreet salary allocation for the purposes of individual performance related pay.”
The TRF process (“Total Reward Framework Agreements and Arrangements”) which has been in place since 2002 is an agreement between the Company and the Guinness Staff Union (GSU) and provides details of the agreed salary review process.
The Union stated that its understanding of the 2012 Agreement meant that it would have had an input into the negotiations on the annual salary review, however, the Company dealt exclusively with GSU. The Union sought to be included in that process. Furthermore, it rejected the proposals which emerged from this process with GSU as the salary pot applied to basic pay only and did not apply to the Work Pattern Allowance (WPA). The Union submitted that as Craftspersons salary is based on basic pay plus WPA it should have applied to the WPA also, therefore it submitted that Craftspersons were specifically disadvantaged as a result.
The Company submitted that in signing up to the 2012 Agreement the Union were explicitly accepting that they were signing up to the TRF process as the governing process for annual pay review. It stated that it was clear during the negotiations on that Agreement that TEEU could avail of the GSU consultation outcomes and that the Company would not include TEEU (or SIPTU) in that process. It encouraged both unions to engage with GSU to find an acceptable accommodation of their positions.
The Court notes that TEEU is open to and have pro-actively engaged in finding a solution to the consultation issue. This process is ongoing at the moment and engagement has taken place between all three Unions, with draft proposals due to be discussed in the coming weeks. The Court is of the view that that this process should continue, and should be facilitated by a third party if required and recommends accordingly.
The Court is satisfied that the 2012 Agreement as written is clear on the process to be undertaken to determine the annual salary review which specifically stated that it will be determined by the current TRF process. The proposals which emerged from that process, which have been accepted by the majority of employees, stated that any increase in pay will be calculated on basic pay only. The terms of this agreement have been implemented by the Company. In such circumstances the Court recommends that the Union should accept the terms as agreed through the currently agreed process.
The Court so recommends.
Signed on behalf of the Labour Court
2nd September 2014______________________
Enquiries concerning this Recommendation should be addressed to Andrew Heavey, Court Secretary.