Labour Court Database __________________________________________________________________________________ File Number: CD87138 Case Number: LCR11146 Section / Act: S67 Parties: SYNTHETIC INDUSTRIES - and - ITGWU;NEETU |
Claim, on behalf of approximately 220 workers, for an increase in pay and conditions of employment under the 26th wage round.
Recommendation:
5. The Court, in view of the circumstances pertaining in the
Company recommends as follows:
an increase of 3% from the 1st April, 1987, and that
both parties review the position at the end of June, 1987.
Division: Ms Owens Mr Collins Mr Walsh
Text of Document__________________________________________________________________
CD87138 THE LABOUR COURT LCR11146
CC87112 INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
RECOMMENDATION NO. LCR11146
Parties: SYNTHETIC INDUSTRIES LIMITED
and
IRISH TRANSPORT AND GENERAL WORKERS' UNION
NATIONAL ENGINEERING AND ELECTRICAL TRADE UNION
Subject:
1. Claim, on behalf of approximately 220 workers, for an increase
in pay and conditions of employment under the 26th wage round.
Background:
2. The Company which was formerly owned by J. & L.F. Goodbody
commenced operations in Clara in November, 1984. Following the
expiry of the 25th round on 31st December, 1986, the Unions served
a 26th round claim on the Company.
(a) 10% increase over 12 months;
(b) special #5 per week increase for lowest paid grade;
and,
(c) reduction from 40 to 39 working hours per week.
In local discussions the Unions indicated that they were willing
in an effort, to facilitate an early agreement, to accede to a one
phased increase of 7% plus the #5 special increase for the lowest
paid and to drop their claim for a shorter working week.
The Company pleaded inability to pay any increase for the
foreseeable future due to the current market situation. On 22nd
January, 1987, the Unions referred the claim to the conciliation
service of the Labour Court.
At a conciliation conference held on 10th February, 1987, the
Unions, whilst expressing appreciation of the Company's financial
difficulties, argued that the 26th round was already far behind
other companies in the locality. They could not accept any pause
and expected to receive at least the norm for the round. The
Company argued that this was not a relevant consideration and the
only relevant consideration was what the Company could afford.
The Company's costs were already too high and that as further cost
increases could not be passed on to customers it had no option but
to request a pay pause. As no agreement could be reached at
conciliation, the parties referred the matter, on 23rd January,
1987, to the Labour Court, for investigation and recommendation.
A Court hearing took place on 24th March, 1987, in Tullamore, Co.
Offaly.
Unions' arguments:
3. (a) Since the Company took over Goodbody's, the operation
has become highly efficient, e.g. the raw material
wastage factor has been reduced from 20% to about 6%.
The operation allows the Company to maximise it's
production levels to meet its E.E.C. marketing
requirement. Indeed, its productivity level has been
increased from around 45% to the current 85%.
(b) Given the comparative wage schedule between the Clara
operation and the Company's sister plant in Newry, the
Unions believe that the claim is both merited and
reasonable, (details provided to the Court).
(c) The Company which has a promising future, can well
afford to settle this reasonable wage claim. The
parent Company in U.S.A. has large financial,
technical, production and marketing resources, and is
in a position to support the Company, during it's
current difficulties.
(d) The Company has intimated it's intention to declare
some 106 workers redundant so that it can concentrate
on the value added rather than manufacturing operation.
It seems ironic that the Company is willing to move
some #6 million in capital assets out of Clara in an
effort to strengthen it's other locations. This
position only confirms the correctness of the Unions'
claim for a reasonable wage.
Company's arguments:
4. (i) A large capital investment programme has been
implemented to raise the level of efficiency and reduce
operating costs. However, due mainly to the
Punt/Sterling relationship and it's effects in the U.K.
market, the Company has suffered heavy losses, (details
supplied to the Court).
(ii) In order to try and arrest the situation, a
rationalisation programme, which resulted in
approximately 40 redundancies, was put into effect in
August, 1986. Since the rationalisation, the Company
has experienced further price erosion and losses, which
makes the Company unviable due to size, competition,
energy costs, freight costs, etc.
(iii) In addition, to the rationalisation programme, the
Company has had to make the decision to cease the
manufacture of industrial fabrics with the loss of over
100 jobs. In view of the serious difficulties facing
the Company and to have any hope of success, it is
essential that the Company has a period of wage
restraint, whch can be reviewed in six months time.
RECOMMENDATION:
5. The Court, in view of the circumstances pertaining in the
Company recommends as follows:
an increase of 3% from the 1st April, 1987, and that
both parties review the position at the end of June, 1987.
~
Signed on behalf of the Labour Court
Evelyn Owens
_________________________
Deputy Chairman.
27th April, 1987
B.O.'N./J.C.