Labour Court Database __________________________________________________________________________________ File Number: CD87785 Case Number: LCR11569 Section / Act: S67 Parties: PENN CHEMICALS B.V. - and - ITGWU |
Claims for an increase in wages and improvement in conditions of employment under the 26th wage round.
Recommendation:
10. The Court having considered the submissions both written and
verbal made during the course of the hearing expresses its concern
at the apparently poor industrial relations climate, prevailing in
the Company and urges all concerned immediately to devote their
energies in a constructive manner towards improving relationships.
In relation to the claims before it, the Court recommends as
follows:
(1) Pay - 5.2% from 1st December, 1986 to 30th
November, 1987.
(2) Annual leave - The Company should consider concession of
the Union's claim for extra annual leave in
the context of negotiations which should
take place to agree a method of phasing out
the present position on holiday cover.
(3) V.H.I. - The Court recommends that the Company's
offer at previous negotiations to increase
the present scheme to 3/4 plan B + 30 units
be accepted.
(4) Compassionate
Leave - The Court does not recommend concession of
the claim.
Division: Ms Owens Mr McHenry Mr O'Murchu
Text of Document__________________________________________________________________
CD87785 RECOMMENDATION NO. LCR11569
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67
PARTIES: PENN CHEMICALS B.V.
AND
IRISH TRANSPORT AND GENERAL WORKERS' UNION
SUBJECT:
1. Claims for an increase in wages and improvement in conditions
of employment under the 26th wage round.
BACKGROUND:
2. The Company is a subsidiary of a U.S. based Company, Smith
Klime Beechman Corporation and commenced operations in Cork in
1975. It currently employs a staff of 250. The main product
produced in Cork is an ulcer treatment which was launched on the
world markets in 1976. The Union represents 95 process operators,
general workers and supplies operators all of whom are 4 hour
shift workers.
3. The 25th wage round expired on the 30th November, 1986. The
Union lodged the following claims on 25th October, 1986:-
3. 1. An increase of 12% in one phase for a period of 12 months
effective from 1st December, 1986.
2. 24 hours additional paid annual leave.
3. Compassionate leave to be increased to 4 days x 12 hours
for shift workers and 4 days x 8 hours for day workers.
4. Company to pay 3/4 of Plan C + 30 units of voluntary
health insurance (V.H.I.).
5. Improvements in the present pension scheme and income
protection scheme.
4. Company/Union meetings were held on the 1st and 2nd of
December, 1986 to discuss the claims. On the question of pay the
Company proposed that any further wage increase should be deferred
to March, 1987 and that discussions should be held at that time.
Another meeting was scheduled for 3rd February, 1987, but because
of an unofficial industrial dispute and a disagreement over
representation at wage talks it was the 11th August, 1987 before
talks on the wage claim resumed.
5. In the interim approximately half of the workers covered by
the claim entered into individual agreements with the Company.
Under the agreements the workers accepted a phased pay increase
over 14 months, a lump sum payment of 2% of basic pay was made to
those who entered the merit payment system on 1st September, 1987
in recognition that future pay reviews will be based on personal
performance and will not be negotiated. The pay reviews to take
place on the February of each year.
6. At the resumed meeting the Company offered the Union a phased
increase of 4.2% over 15 months. The Company in dealing with the
claim for increased annual leave sought changes in the system of
holiday cover which requires the Company to provide overtime when
any operator is on holiday. This results in a situation which
adds to the Company's cost when such overtime is not required by
the plant workload. The Company proposed that those arrangements
should be phased out over a number of years and that in 1987/1988
the Company would undertake that at least the equivalent number of
overtime hours would be worked. The Company understood that the
other elements of the claim had been resolved.
7. The Union rejected the Company's offer and the matter was
referred to the conciliation service of the Labour Court on 18th
May, 1987. Conciliation conferences were held on 17th September,
1987 (earliest date suitable to the parties) and 9th October,
1987. As no agreement was possible the Union requested that their
claim as outlined in paragraph 3 be referred to the Labour Court
for investigation and recommendation. The Company agreed to the
referral and a Court hearing was held in Cork on 4th November,
1987.
UNION'S ARGUMENTS:
8. 1. Wage increase From the outset of the negotiations the
Union made it clear that the figure of 12% for 12 months was
negotiable. The increase under the 26th round for the
chemical/pharmaceutical companies in the Cork area was 8% over
12 months (details supplied to the Court).
2. Up to the present agreement the wage rates in this Company
were the highest. However this situation has now been altered
and a wage increase of 8% would only rectify this imbalance.
3. The Company have received greater productivity over the
last 12 months by the non-replacement of 5 workers who left
the Company.
4. The Company's offer is lower than that received by the
workers who entered into private agreements and that paid to
the craft workers. (The craft workers were paid an interim
lump sum equivalent to 5.2% pending the outcome of
negotiations on their wage round).
8. 5. Annual leave. The present entitlement for shift workers
is 23 days + 2 company days and for day workers 17 days + 2
Company days. The standard differential between shift and day
workers is 5 days. In earlier negotiations the Company did
offer 2 extra days annual leave if the Union were prepared to
concede 2 days uncertified sick leave, which was unacceptable.
Since then the Company offered 2 days to the day workers who
signed individual contracts of employment which now means the
differential between shift and day workers is only 3 days.
There is as a result of this, clear justification to grant the
shift workers the extra days claimed.
6. Compassionate leave. The present arrangement of
compassionate leave is inadequate because of the complexity of
the shift system.
7. Voluntary Health Insurance. The Company offered to
increase the present scheme to 3/4 plan B + 30 units. Ever
since this claim was submitted the drastic cutback in the
health services makes it absolutely essential to have adequate
V.H.I. cover. This claim should be conceded particularly as
the Company is directly involved in the health care industry.
8. Pension scheme and income protection scheme. The Union
are not seeking a recommendation on this aspect of the claim
but that negotiations continue with the Company and that an
improvement in the scheme would not be precluded by any "no
cost increasing" clause which is usually attached to any final
agreement.
COMPANY'S ARGUMENTS:
9. 1. Increase in pay. The Company's offer is fair and
reasonable in view of the high settlement conceded under the
25th wage round (details supplied to the Court). Earnings in
1987 will be 2.8% higher than in 1986 before any 26th round
settlement. The Company's offer when added to this carry over
gives a total increase of 7.3%.
2. By comparison with comparable employments the rates of pay
for process operators are high. This situation cannot be
sustained in the light of the competitive pressures faced by
the Company (details supplied to the Court). The Company
carried out a survey of 9 local companies (details supplied to
the Court). It should be noted that 3 of the companies are
involved in the manufacture of competitive products. Of these
the Company has the highest basic rate of pay.
9. 3. Holiday entitlements. The Company has carried out a
survey of holiday entitlement in comparable companies which
operate a four shift system. No evidence has been found that
the holiday entitlements at Penn Chemicals are out of line.
Furthermore because of the holiday cover agreement the cost of
holiday pay is significantly higher than in other companies.
The Company is not in a position to consider any increase in
current holiday entitlement until such time as the obligation
to cover holiday absence is removed.
RECOMMENDATION:
10. The Court having considered the submissions both written and
verbal made during the course of the hearing expresses its concern
at the apparently poor industrial relations climate, prevailing in
the Company and urges all concerned immediately to devote their
energies in a constructive manner towards improving relationships.
In relation to the claims before it, the Court recommends as
follows:
(1) Pay - 5.2% from 1st December, 1986 to 30th
November, 1987.
(2) Annual leave - The Company should consider concession of
the Union's claim for extra annual leave in
the context of negotiations which should
take place to agree a method of phasing out
the present position on holiday cover.
(3) V.H.I. - The Court recommends that the Company's
offer at previous negotiations to increase
the present scheme to 3/4 plan B + 30 units
be accepted.
(4) Compassionate
Leave - The Court does not recommend concession of
the claim.
~
Signed on behalf of the Labour Court.
Evelyn Owens
___4th___December,__1987. ___________________
M. D. / M. F. Deputy Chairman