Labour Court Database __________________________________________________________________________________ File Number: CD87440 Case Number: LCR11360 Section / Act: S67 Parties: NAVAN CARPETS LTD. - and - ITGWU |
Claims on behalf of approximately 170 general workers for (a) an increase of 10% on wage rates (b) shift differential to be paid on actual pay and (c) increase in service pay under the 26th wage round.
Recommendation:
5. The Court having considered the submissions from both parties
recommends as follows in relation to the 26th wage round claim:-
2.50% from 1st April, 1987 and a further 2.50% from 1st
November, 1987.
Agreement to terminate on 31st March, 1988.
The Court does not recommend any increase in service pay or
revision of the method of calculating shift premium in present
circumstances.
Division: Ms Owens Mr Shiel Mr O'Murchu
Text of Document__________________________________________________________________
CD87440 THE LABOUR COURT LCR11360
CC87866 INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
RECOMMENDATION NO. LCR11360
Parties: NAVAN CARPETS LIMITED
and
IRISH TRANSPORT AND GENERAL WORKERS' UNION
Subject:
1. Claims on behalf of approximately 170 general workers for (a)
an increase of 10% on wage rates (b) shift differential to be paid
on actual pay and (c) increase in service pay under the 26th wage
round.
Background:
2. The 25th wage round expired on 31st March, 1987. The Union
lodged the claims listed at (1) above under the 26th wage round
effective from 1st April, 1987 for a 12 month duration. In
response the Company initially initially sought a 3 reduction in wages for twel
increasing claims, industrial peace procedures and co-operation
with the introduction of new technology. As no resolution was
possible following meetings at local level, the matter was
referred to the conciliation service of the Labour Court on 20th
March, 1987. A conciliation conference was held on 20th May,
1987. As no agreement could be reached both parties agreed to a
referral to the Labour Court for investigation and recommendation.
A Labour Court hearing was held in Navan on 28th July, 1987.
Union's arguments:
3. (a) Increase on wage rates:-
The Union sought an increase of 10% which was
negotiable but because of the Company's adopted
position an opportunity to negotiate never arose. In
view of the agreements already reached in industry
generally, the textile industry, and the Joint Labour
Committees (J.L.C.) and Joint Industrial Councils
(J.I.C.) for the textile industry (details supplied to
the Court) the workers are seeking a minimum increase
of 5% operative from the 1st April, 1987 for twelve
months.
(b) The Company which is part of the Youghal Carpet
Holdings Group is now owned by Coats Vijella, the
biggest textile group in Europe. The carpet division
in 1985 made an operating profit of #2.6 million which
represented a doubling of profits over 1984 levels.
(c) The groups sister Company has provided a two phased
increase of 5% over a 12 months period effective from
1st January, 1987. A 12 month agreement for the
workers concerned would reduce the difference in the
length of agreements between the two companies to 2
months. The difference is currently 3 months and has
been in existence now for a number of years.
(d) Service Pay:
This element of the claim has been the subject of
previous wage round negotiations. At this time service
pay is out of line within the group and with service
pay schemes generally. The workers are seeking to have
their service pay brought back into line during the
life of the 26th wage round.
(e) Shift premium on actual pay:
The workers are paid their shift premiums on a ghost
rate set for this purpose which is adjusted by wage
increases as they occur. However the workers work
within a piecework system and therefore the ghost rate
is totally out of line with actual or real earnings.
The workers are seeking to have their shift premium
paid on actual pay.
Company's arguments:
4. (i) The Company is at present in a serious loss making
position and has been for a number of years (details
supplied to the Court). One of the crucial aspects of
the Company's survival plans in reversing this loss
making situation is the ongoing implementation of a
cost reduction programme. The Company is endeavouring
to improve its performance by pursuing additional
improvements in areas from increased sales targets to
improved materials utilisation. It is imperative that
costs are not permitted to increase in any area of
operation where direct control can be applied if the
Company is to return to profitability.
(ii) The Company is heavily dependent on the U.K. and U.S.A.
markets in order to maintain current levels of
production. Despite extensive rationalisation
undertaken in these market areas over the past year,
the Company is experiencing very severe competition,
and is finding it increasingly difficult to remain
competitive. This problem is being compounded by the
effect of the exchange rate on both these markets
(details supplied to the Court).
(iii) The Company has to survive on the resources available
to it, and given the present loss making and cash flow
difficulties the Company is experiencing, it would be
irresponsible of the Company to jeopardise it's future
by increasing wage costs, which already amount to
#3,510,000 per annum. The Company clearly can't afford
to support additional costs at present, and concession
of any wage claim would equate to job losses; which
would be undesirable by Company and workers.
RECOMMENDATION:
5. The Court having considered the submissions from both parties
recommends as follows in relation to the 26th wage round claim:-
2.50% from 1st April, 1987 and a further 2.50% from 1st
November, 1987.
Agreement to terminate on 31st March, 1988.
The Court does not recommend any increase in service pay or
revision of the method of calculating shift premium in present
circumstances.
~
Signed on behalf of the Labour Court
Evelyn Owens
_________________________
Deputy Chairman
21st August, 1987
M.D./J.C.