Labour Court Database __________________________________________________________________________________ File Number: CD86816 Case Number: LCR10908 Section / Act: S67 Parties: GEORGE BELL SHIP MANAGEMENT - and - FWUI |
Claim on behalf of approximately 120 seafaring staff for a pay increase under the 25th wage round.
Recommendation:
8. The Court, having considered the submissions made by the
parties, recommends a 25th Round Wage Agreement as follows:-
(i) A six months' pay pause
(ii) A wage increase of 6% for a period of nine months
commencing on 1st July, 1986.
Having regard to the situation which gave rise to Labour Court
Recommendation No. 10117, the Court recommends that early
discussions on the four requirements sought by the Company should
take place as a separate issue.
Division: Mr Fitzgerald Mr Heffernan Ms Ni Mhurchu
Text of Document__________________________________________________________________
CD86816 THE LABOUR COURT LCR10908
CC861641 INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
RECOMMENDATION NO. 10908
PARTIES: GEORGE BELL SHIP MANAGEMENT LIMITED
(Represented by the Federated Union of Employers)
and
FEDERATED WORKERS' UNION OF IRELAND
Subject:
1. Claim on behalf of approximately 120 seafaring staff for a pay
increase under the 25th wage round.
Background:
2. This Company was formed in 1976, to manage and operate the
Group's fleet of Irish flag owned and managed ships. Its main
business is a container delivery service throughout Europe.
3. The terms of the 24th wage round expired for the workers on
31st December, 1985. Prior to this, negotiations had been taking
place on a rationalisation programme in the Company, which was the
subject of a previous Court hearing (Labour Court Recommendation
No. 10117, refers) and earlier this year the Company was taken
over by a major Dutch concern. As a result of these developments,
no discussions took place on the 25th wage round.
4. In the course of negotiations at local level in
September/October 1986 the Union, on behalf of the workers
concerned served a claim on the Company in respect of the 25th
wage round, for a single phase increase of 8% with effect from 1st
January, 1986 for a twelve month period. The Company rejected the
claim but put forward the following proposal:-
- a #9.00 per week increase from 1st July, 1986, for a six
month period, followed by a #2.00 per week increase for a
further six months, with no further cost increasing
claims for the duration of the agreement. This offer
conditional on acceptance of revised working arrangements
as follows:
(i) introduction of a new salary and conditions structure for
temporary employees with effect from 1st November, 1986
(ii) a voluntary redundancy package to be available for a 3
month period to 31st December, 1986, with a view to
restructuring the composition of relief crews
(iii) reduction of excessive travel costs and compassionate
leave to be granted at Company's expense, only where
absolutely necessary
(iv) five day flexibility arrangement to be extended to a
fifteen day cover.
5. This was unacceptable to the Union and as no agreement could
be reached the matter was referred on 7th October, 1986, to the
conciliation service of the Labour Court. A conciliation
conference was held on 20th October, 1986 at which the Union said
it was not prepared to discuss further cost saving measures as
part of the 25th wage round, but offered to enter into discussions
on a review of the seven man self-relieving system on completion
of negotiations on the 25th wage round. As no agreement could be
reached the claim was referred to the Labour Court for
investigation and recommendation. The Court investigated the
dispute on 9th December, 1986, - the earliest date suitable to
both parties.
Union's arguments:
6. (i) In the two previous wage rounds which covered the
period from 1st January, 1983, to 1st January, 1986,
the workers accepted pay freezes for a total of twelve
months. Settlements in these rounds were considerably
lower than the Consumer Price Index for the same
period. The present claim is well within the range of
average settlements under the 25th wage round and will
not dramatically improve the pay of the workers
concerned but will to some extent stop further erosion
in pay.
(ii) The salary levels of the workers concerned are the
norm for the type of work involved and reflect the
type of operation run by this Company and the working
conditions.
(iii) The Company is trading well and has benefited from the
drop in the price of oil and devaluation of the punt
against the German mark. The excessive price of oil
has previously been one of the factors put forward by
the Company for the introduction of pay freezes.
(iv) The rationalisation programme agreed last year will
result in cost savings of approximately #620,000 -
#650,000 and the takeover of the Company by a
profitable Dutch firm has put it in a better position
for the future. When the rationalisation programme
commenced in March, 1986, it was accepted by both
sides that the introductory year would realise no
savings.
(v) The revised working conditions put forward by the
Company in the context of the 25th wage round in
effect include further additional rationalisation
measures. The Union does not wish to have a two tier
pay structure introduced into the Company and believes
that it will be used in the future to the detriment of
the overall conditions of employment of the workers
here concerned. Reduction of travel costs and
granting of compassionate leave is in the Company's
own control and is a management issue.
(vi) The Union has offered to enter into discussions with
the Company on a review of the seven man self
relieving system on completion of negotiations on the
25th Wage Round.
(vii) The report on the comprehensive examination of the
Group's operations commissioned by the new owners
includes a statement to the effect that the present
salaries for seamen on seven man crews are not
considerably above the average of North European
seamen wages.
Company's arguments:
7. (a) The pay freezes contained in previous wage rounds were
necessary due to the difficult trading period the
Company had been going through. The salary levels of
the workers concerned are among the best in this type
of industry.
(b) While developments such as the reduction in oil prices
have improved the Company's position, without these
the Company would be in more serious difficulty. The
Company's competitors have also benefited from the
reduction in oil prices.
(c) The Company has experienced difficult trading
circumstances over the past number of years. While
revised operating arrangements resulting from the
rationalisation programme are coming into effect the
degree of savings will be lower than expected. The
deficit in the savings target will probably be in the
region of #120,000. There is a clear expectation from
the new owners that these savings must be realised and
that this Company should survive on its own merits.
(d) If the Company is to have a prosperous future it must
get back into a profitable position and remain
competitive. Even with the introduction of cost
savings the fleet remains uncompetitive and further
cost increases which would negate the results of the
rationalisation programme must be avoided. The
Company considers the proposed new working
arrangements the best method for both the Company and
the workers in order to achieve the full savings
envisaged in the implementation of the rationalisation
programme.
(e) The main reason that the Company is behind in the
projected savings is the costs incurred from
employment of temporary relief staff. The revised
working arrangements would have a minimal impact on
the existing permanent workforce. It would not be the
Company's intention to use the new salary and
conditions structure for temporary workers to change
the salary levels of permanent workers. The proposal
is specifically related to the problems of
costs arising from temporary workers.
(f) The new owners of the Company have carried out a
comprehensive examination of the Group's operations
and have made a decision that there should be no pay
increases until 1st July, 1986. This embargo is being
applied universally throughout the group on an
European basis. The pay offer put forward by the
Company reflects a fair attempt by the Company to
resolve the issue and is a more than adequate pay
award in the circumstances.
RECOMMENDATION:
8. The Court, having considered the submissions made by the
parties, recommends a 25th Round Wage Agreement as follows:-
(i) A six months' pay pause
(ii) A wage increase of 6% for a period of nine months
commencing on 1st July, 1986.
Having regard to the situation which gave rise to Labour Court
Recommendation No. 10117, the Court recommends that early
discussions on the four requirements sought by the Company should
take place as a separate issue.
~
Signed on behalf of the Labour Court
14th January, 1987 Nicholas Fitzgerald
U.M./P.W. Deputy Chairman