Labour Court Database __________________________________________________________________________________ File Number: CD86953 Case Number: LCR10963 Section / Act: S67 Parties: HGW PAINTS - and - ITGWU;ITGWU |
Claims on behalf of approximately 100 workers, in respect of the 26th wage round, for:- (a) a substantial increase in basic pay for a period of 12 months, (b) a reduction in the working hours, (c) an increase in annual leave, (d) a review of the pension scheme, and (e) holiday pay to be based on average pay including overtime.
Recommendation:
15. The Court, having considered the submissions made by the
parties, recommends a 26th wage round agreement providing for a
pay pause of six months followed by an increase of 5% effective
from 1st January, 1987, for seven months. The Court does not
recommend concession of the other claims other than the claim for
the inclusion of overtime payment in the calculation of holiday
pay. In this regard, the Court recommends that regular rostered
overtime should be taken into account in the calculation of
holiday pay.
Division: Mr Fitzgerald Mr Heffernan Mr Devine
Text of Document__________________________________________________________________
CD86953 THE LABOUR COURT LCR10963
CC861554 INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
RECOMMENDATION NO. 10963
PARTIES: HARRINGTON GOODLASS WALL (HGW)
(Represented by the Federated Union of employers)
and
IRISH TRANSPORT AND GENERAL WORKERS' UNION
Subject:
1. Claims on behalf of approximately 100 workers, in respect of
the 26th wage round, for:-
(a) a substantial increase in basic pay for a period of
12 months,
(b) a reduction in the working hours,
(c) an increase in annual leave,
(d) a review of the pension scheme, and
(e) holiday pay to be based on average pay including
overtime.
General background:
2. The workers involved in this claim are employed in the
Company's manufacturing plant in Cork and its distribution depot
in Dublin. The terms of the 25th wage round expired for the
workers concerned on 30th June, 1986. The Union, on behalf of
these workers, served the above claims on the Company in respect
of the 26th wage round, effective from 1st July, 1986. No
agreement was reached on any of the claims at local level and the
matters were referred, on 19th September, 1986, to the
conciliation service of the Labour Court. Subsequent to a
conciliation conference, which was held on 4th November, 1986, at
which no further agreement was reached, the dispute was referred
to the Labour Court for investigation and recommendation. The
Court investigated the dispute on 9th January, 1987. At the Court
hearing the parties stated that the matter relating to the pension
scheme had been referred back to local level for further
negotiations.
Claim (a) - a substantial increase in basic pay for a period of 12
months
Background:
3. The current basic pay of the workers concerned, inclusive of
the terms of the 25th wage round, ranges from #133.77 to #145.03
per week, depending on grade. The Union, on behalf of the
workers, served the above claim on the Company in respect of the
26th wage round. In the course of negotiations on the matter the
Union quantified its claim as one for a 10% basic pay increase for
12 months, effective from 1st July, 1986. The Company rejected
the claim but at local and conciliation level offered a 15 month
agreement providing for a pay pause to the end of 1986, followed
by a 3% increase in basic pay from the 1st January, 1987, for 9
months. The offer was rejected by the Union.
Union's arguments:
4. (i) The wage freeze proposed by the Company is
unacceptable on the basis that the concept of pay
pauses is at variance with the policy of both the
Union and the Irish Congress of Trade Unions. The
result of pay pauses in the past have been to depress
workers' living standards and has contributed nothing
to the prevention of redundancies taking place.
Furthermore, very few pay pauses are provided for in
settlements under the current pay round and most
cases where such provision is made, payments in lieu
have been conceded.
(ii) The current basic pay of the workers concerned is
inadequate and out of line with the average industrial
wage. It is also out of line with other companies in
terms of the wide pay differential which exists
between the grades of workers concerned and the
Company's supervising grade.
(iii) It is generally acknowledged that living standards
over the years have diminished, particularly in
the PAYE sector, due mainly to government taxes,
inflation and increases in the consumer price index.
Furthermore, pay increases in the various pay rounds
in the company have fallen far short each year of the
level of inflation obtaining since 1980, with the
exception of the terms of the 25th wage round. On
this basis the level of increase sought by the Union
under the current pay round is justified.
(iv) In recent years a modernisation programme was
introduced in the Company which resulted in changes in
production, equipment and work practices, increased
co-operation and flexibility, and the curtailment of
overtime. These changes, which have realised large
savings for the Company, came about with the full
co-operation of the workers so that the Company would
be more competitive in the market place. Also,
despite the fact that the workforce has been reduced
by half in recent years, the Company now has the
capacity to produce more paint than heretofore. This
demonstrates the increased productivity levels of the
workers, which have contributed to the Company's
future viability, and such endeavour should be
rewarded by higher increases in the basic rates.
(v) Negotiated settlements to date under the 26th wage
round show an average increase of 6.2% over 12 months
(details supplied to the Court). However, 20% of all
such settlements give increases of between 7% and 8%
over 12 months.
(vi) In all the circumstances the level of increase sought
is fully justified and should be conceded.
Company's arguments:
5. (a) The Company has suffered substantial losses in recent
years and the indications are that this trend will
continue for the immediate future (details supplied to
the Court). In these circumstances, the Company
cannot absorb any further cost increases at levels in
excess of the offer made.
(b) The Company's total production has greatly diminished
in recent years (details supplied to the Court). If
costs continue to rise this fall-off in production
will continue and could reach an uneconomical level
which would result in job losses.
(c) The Paint Industry is affected by the general
recession which is being felt throughout the economy
and particularly in the building industry. This has
resulted in fall off in sales over recent years
reflected in lower production. This problem is
exacerbated by continued growth in imports which at
present accounts for approximately 25% of the Irish
market. It is cheaper to produce paint in U.K.
factories where rates of pay are lower and where in
most cases, such factories also enjoy the benefits of
larger scale production. There is considerable fear
therefore, both in the Company and the industry
generally that it will become totally uneconomic to
produce paint in Ireland and there is a serious risk
that some manufacturing companies will simply convert
to being importers and distributors of products
produced by their parent companies overseas.
(d) There has been a significant decrease in the number of
workers employed by the Company in recent years. The
Company is hoping to maintain employment at current
levels. However any pay increase over and above the
level already offered will result in further job
losses.
Claim (b) - a reduction in the working hours
Background:
6. At present the working week in the Company is 40 hours. The
Union, on behalf of the workers concerned, served a claim on the
Company for a reduction in the weekly working hours. The Company
rejected the claim.
Union's arguments:
7. (i) It is the policy of the Trade Unions as a whole to
seek a reduction in the working hours throughout
industry generally. While progress in this area has
been slow nevertheless a number of settlements under
the 25th wage round provided for a reduction in the
weekly working hours (details supplied to the Court).
(ii) A shorter working week would be appropriate in the
case of the workers concerned, having regard to the
nature of their employment and the demanding
conditions under which they work.
(iii) The standard 40 hour working week in Ireland is out of
line with that which obtains generally throughout
other European countries where shorter working hours
are in operation.
(iv) It has been established that in countries where a
shorter working week has been introduced that this has
contributed to the saving of thousands of jobs in
those countries. The Union is satisfied that a
similar situation would arise in Ireland through the
introduction of a shorter working week.
(v) The claim is valid one and should be conceded.
Company's arguments:
8. (a) The Company is always seeking ways of reducing costs
and in this regard overtime costs are very high. A
reduction in working hours would lead to increased
overtime working which would be a situation that the
Company could not sustain.
(b) The norm throughout industry generally in respect of
weekly working hours is 40 hours. There is no reason
why the Company should change that position.
Claim (c) - an increase in annual leave
Background:
9. The present annual holiday entitlement in the Company is 20
days. Service leave also applies with a maximum of 3 days after
20 years' service. The Union, on behalf of the workers concerned,
served a claim on the Company for an increase in the annual leave
entitlement. The Company rejected the claim.
Union's arguments:
10. (i) A number of employments have agreed to increase the
annual leave entitlement of their workers under the
agreed terms of the 25th wage round.
(ii) Medical experts agree that workers should be given
more leisure time to recuperate from the pressures of
modern day employment. In this respect, the nature of
the work and conditions under which the workers
operate is very demanding. Accordingly, they are
justified in seeking additional annual leave.
(iii) Workers generally in Ireland are out of line with
their counterparts in Europe in respect of annual
leave entitlement (details supplied to the Court).
(iv) The claim is a valid one and should be conceded.
Company's arguments:
11. (a) The annual leave entitlement in operation in the
Company is in line with that which applies throughout
industry generally.
(b) The question of increased leave was dealt with during
the last wage negotiations in the Company.
Claim (e) - holiday pay to be based on average pay including
overtime
Background:
12. At present overtime payment is not included in the
calculation of holiday pay. The Union, on behalf of the workers
concerned, is seeking the inclusion of overtime pay in holiday pay
and refers to the working of rostered overtime by some workers in
certain departments. The Company rejected the claim.
Union's arguments:
13. (i) Under the terms of the Company/Union agreement all
workers are expected to work a reasonable amount of
overtime when requested to do so. Accordingly, the
workers concerned work a considerable amount of
overtime throughout the year. In fact, because of the
nature of the industry workers in some departments are
on rostered overtime. Accordingly, overtime working
is a regular part of the workers' duties and should be
included in the calculation of holiday pay in the same
manner as all other enhanced payments.
(ii) Other companies include overtime payment in the
holiday pay of their workers and the Court in a number
of recommendations has recommended in favour of the
inclusion of such payment in holiday pay (details
supplied to the Court).
(iii) The claim is a reasonable one and should be conceded.
Company's arguments:
14. (a) Bonus payments are included in the calculation of
holiday pay and payment of service pay is made prior
to the holiday shutdown. Therefore average pay as
claimed by the Union is included by the Company in
holiday pay.
(b) In respect of the claim regarding the inclusion of
overtime payments in holiday pay, the Company accepts
that in the past the Labour Court has recommended in
favour of this. However, such recommendations refer
to situations where regular and rostered overtime was
being worked and in areas such as supermarkets and
bakeries. Such overtime does not occur in this
Company.
RECOMMENDATION:
15. The Court, having considered the submissions made by the
parties, recommends a 26th wage round agreement providing for a
pay pause of six months followed by an increase of 5% effective
from 1st January, 1987, for seven months. The Court does not
recommend concession of the other claims other than the claim for
the inclusion of overtime payment in the calculation of holiday
pay. In this regard, the Court recommends that regular rostered
overtime should be taken into account in the calculation of
holiday pay.
~
Signed on behalf of the Labour Court
2nd February,1987 Nicholas Fitzgerald
T.McC./P.W. Deputy Chairman