Labour Court Database __________________________________________________________________________________ File Number: CD86811 Case Number: LCR10880 Section / Act: S67 Parties: SNOWCREAM LTD - and - ITGWU |
Claim for an increase in commission paid on cream sales.
Recommendation:
5. The Court does not recommend concession of the Union's claim
that commission on cream be paid on a percentage basis. Having
regard to the confusion that exists between the parties as to what
the rate currently should be, the Court recommends that the
parties meet again to negotiate directly on the basis of price per
unit commission.
Division: Mr O'Connell Mr McHenry Mr Devine
Text of Document__________________________________________________________________
CD86811 THE LABOUR COURT LCR10880
CC86835 INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
RECOMMENDATION NO. LCR10880
Parties: SNOWCREAM LIMITED
and
IRISH TRANSPORT AND GENERAL WORKERS' UNION
Subject:
1. Claim for an increase in commission paid on cream sales.
Background:
2. The claim concerns 8 drivers and 8 helpers employed by the
Company in the wholesale delivery of milk and cream. Since 1977
they have been paid commission on sales of cream on a volume
basis. The commission is paid on an annual basis at Christmas.
The current rates payable to the drivers are based on a fixed
amount of volume sales and vary between .05p for medium to .8p a
gallon. The helpers receive one-third of the rates payable. On
the 24th January, 1985 the Union sought a meeting to discuss an
increase in the rates of commission payable on cream sales based
on a 1979 agreement. The Company was unaware of any such
agreement. Following meetings between both parties, the Company
offered to increase the commission to .15p per unit (.50 litre),
.25p on cream cups (per unit). This offer was rejected by the
Union which modified their claim to 1% of the value of cream sales
(they were originally seeking 1.50%). The matter was then referred
to the conciliation service of the Labour Court on 7th May, 1986.
A conciliation conference was held on the 5th September, 1986
(earliest date suitable to both parties). At the conciliation
conference the following proposals emerged: .50 litre .318 pence
per unit; cream cups - (large/medium) .398 pence per unit; gallon
- 2.544 pence per unit. The increases to take effect from 1st
January, 1986 and the rates to be adjusted annually in accordance
with the Consumer Price Index prevailing immediately preceeding
the payout date. These proposals were rejected and the parties
requested the matter be referred to the Labour Court for
investigation and recommendation. A Labour Court hearing was held
in Waterford on 26th November, 1986.
Union's arguments:
3. (a) Commission was introduced as an incentive to encourage
the workers to maintain and improve the level of sales.
In these days of intense competition in the market
place there is even more reason to encourage the
workers to promote sales.
(b) By comparison to milk, which provides the bulk of the
Company's sales, cream, which is more profitable to the
Company needs more promotion to increase and sustain
sales. There is also a higher commission on the sale
of milk compared to that on cream.
(c) It was agreed in 1980 the rates would be increased by
22% on an annual basis. These increases were applied
with the exception of 1984 and 1985 because of an
error. The 1980 agreement also provided for further
automatic increases in line with the C.P.I. but this
did not occur. It is acknowledged that the percentage
level represented by these proposals might appear high
but when account is taken of the very low money value
of the commission and the fact there was already an
increase of 150% overdue the proposals were found to be
inadequate.
Company's argument:
4. (i) Any further improvement on the rates offered by the
Company in its letter of 9th July, 1985 cannot be
justified by the margins pertaining in the liquid milk
industry today. It rejects attempts being made to link
commission on a percentage base to the value of sales.
The National Dairies Association has adopted a policy
of using fixed rates per unit rather than percentages
when dealing with trade. This is essential because
milk is price controlled and the existence of
percentage margins would allow customers to obtain
margin increases to which they are not entitled and for
which the dairy would not be compensated. These
increases result in the case of farmer milk price
reviews, green pound adjustments, consumer subsidy
alterations and price rise resulting from increases in
distributors margins.
RECOMMENDATION:
5. The Court does not recommend concession of the Union's claim
that commission on cream be paid on a percentage basis. Having
regard to the confusion that exists between the parties as to what
the rate currently should be, the Court recommends that the
parties meet again to negotiate directly on the basis of price per
unit commission.
~
Signed on behalf of the Labour Court
John O'Connell
______________________
6th January, 1987. Deputy Chairman.
M.D./J.C.
CD86811 THE LABOUR COURT LCR10880
CC86835 INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
RECOMMENDATION NO. LCR10880
Parties: SNOWCREAM LIMITED
and
IRISH TRANSPORT AND GENERAL WORKERS' UNION
Subject:
1. Claim for an increase in commission paid on cream sales.
Background:
2. The claim concerns 8 drivers and 8 helpers employed by the
Company in the wholesale delivery of milk and cream. Since 1977
they have been paid commission on sales of cream on a volume
basis. The commission is paid on an annual basis at Christmas.
The current rates payable to the drivers are based on a fixed
amount of volume sales and vary between .05p for medium to .8p a
gallon. The helpers receive one-third of the rates payable. On
the 24th January, 1985 the Union sought a meeting to discuss an
increase in the rates of commission payable on cream sales based
on a 1979 agreement. The Company was unaware of any such
agreement. Following meetings between both parties, the Company
offered to increase the commission to .15p per unit (.50 litre),
.25p on cream cups (per unit). This offer was rejected by the
Union which modified their claim to 1% of the value of cream sales
(they were originally seeking 1.50%). The matter was then referred
to the conciliation service of the Labour Court on 7th May, 1986.
A conciliation conference was held on the 5th September, 1986
(earliest date suitable to both parties). At the conciliation
conference the following proposals emerged: .50 litre .318 pence
per unit; cream cups - (large/medium) .398 pence per unit; gallon
- 2.544 pence per unit. The increases to take effect from 1st
January, 1986 and the rates to be adjusted annually in accordance
with the Consumer Price Index prevailing immediately preceeding
the payout date. These proposals were rejected and the parties
requested the matter be referred to the Labour Court for
investigation and recommendation. A Labour Court hearing was held
in Waterford on 26th November, 1986.
Union's arguments:
3. (a) Commission was introduced as an incentive to encourage
the workers to maintain and improve the level of sales.
In these days of intense competition in the market
place there is even more reason to encourage the
workers to promote sales.
(b) By comparison to milk, which provides the bulk of the
Company's sales, cream, which is more profitable to the
Company needs more promotion to increase and sustain
sales. There is also a higher commission on the sale
of milk compared to that on cream.
(c) It was agreed in 1980 the rates would be increased by
22% on an annual basis. These increases were applied
with the exception of 1984 and 1985 because of an
error. The 1980 agreement also provided for further
automatic increases in line with the C.P.I. but this
did not occur. It is acknowledged that the percentage
level represented by these proposals might appear high
but when account is taken of the very low money value
of the commission and the fact there was already an
increase of 150% overdue the proposals were found to be
inadequate.
Company's argument:
4. (i) Any further improvement on the rates offered by the
Company in its letter of 9th July, 1985 cannot be
justified by the margins pertaining in the liquid milk
industry today. It rejects attempts being made to link
commission on a percentage base to the value of sales.
The National Dairies Association has adopted a policy
of using fixed rates per unit rather than percentages
when dealing with trade. This is essential because
milk is price controlled and the existence of
percentage margins would allow customers to obtain
margin increases to which they are not entitled and for
which the dairy would not be compensated. These
increases result in the case of farmer milk price
reviews, green pound adjustments, consumer subsidy
alterations and price rise resulting from increases in
distributors margins.
RECOMMENDATION:
5. The Court does not recommend concession of the Union's claim
that commission on cream be paid on a percentage basis. Having
regard to the confusion that exists between the parties as to what
the rate currently should be, the Court recommends that the
parties meet again to negotiate directly on the basis of price per
unit commission.
~
Signed on behalf of the Labour Court
John O'Connell
______________________
6th January, 1987. Deputy Chairman.
M.D./J.C.