Labour Court Database __________________________________________________________________________________ File Number: CD86910 Case Number: LCR10948 Section / Act: S67 Parties: C.P.I./MARLEY FLOORING - and - ITGWU |
Claim on behalf of approximately eighty factory personnel for improvements in pension scheme.
Recommendation:
5. The Court notes that the Company accept the validity of the
claim and is agreeable to renew negotiations when its trading
position is more favourable.
The Court accordingly recommends that the Union defer
pursuing the claim and that both parties should keep the
position under review.
Division: Ms Owens Mr Heffernan Mr Devine
Text of Document__________________________________________________________________
CD86910 THE LABOUR COURT
CC861769 INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
RECOMMENDATION NO. LCR
PARTIES: C.P.I./MARLEY FLOORING AND PLUMBING LIMITED
AND
IRISH TRANSPORT AND GENERAL WORKERS' UNION
Subject:
1. Claim on behalf of approximately eighty factory personnel for
improvements in pension scheme.
Background:
2. The pension scheme was established on January 1st. 1968, to
provide retirement and life assurance benefits for all full-time
permanent factory employees in Dublin who are not included in the
Company's staff pension plan. The scheme has used a control
funded method of costing since 1974. It was revised in 1979, on
the basis of an equal weekly contribution rate - of #1.50 each,
from both the Company and employee. The scheme provides for a
Death-in-Service benefit of #6,000 and a maximum pension of #21
per week. In February, 1983 the Union requested a meeting with
the Company to discuss improvements in the scheme. The Company
responded by saying they had requested from the pension trustees
an actuarial report and a review of the scheme. The actuarial
report was considered by the Union's pension advisors and at a
meeting between the Union and the Company on 19th April, 1985 the
Union quantified its claim as follows:-
- an income continuance scheme.
- Pay related pension yielding 40/50 of pensionable pay.
- Escalation clause.
- Survivors pension.
- 3 years gross pay - Death Benefit.
During these discussions the Company indicated a willingness to
consider some improvements to the scheme, however since then a
number of issues have arisen within the Company and the claim was
not processed. Further local level negotiations on October 24th,
1986, failed to resolve the issue and on October, 28th, the matter
was referred to the conciliation service of the Labour Court. A
conciliation conference took place on November 24th, 1986, but no
agreement was reached and on the 25th November, the matter was
referred to the Labour Court for investigation and recommendation.
A Court hearing took place on 17th December, 1986.
Union's arguments:
3. (1) The present pension scheme is a particularly poor one
and is not of good value, even for the relatively low
level of members contributions. The investment method
used at present gives very poor value for money and
better value could be obtained by use of a different
system.
(2) The Union's own pension advisors advised that the scheme
is an exceptionally poor one by general standards and
recommended that a pay related scheme be sought. In
September, 1985, the Union modified its claims in
response to a willingness on the part of the Company to
look at improvements. However in October, 1986 the
Company informed the Union that it was not prepared to
fund any improvements in the scheme in any proportion
with members. After 3.50 years of on and off negotiations
this is completely unacceptable.
(3) The scheme is supposed to be reviewed every three years
but this has not been done. It specifically states in
the scheme that the present fixed pay of #60 is for a
three year initial period. This figure has never been
up-dated.
(4) The competitors in the industry, many of whom are not in
as strong a market position as the Company, are offering
much better pension schemes to their employees (details
provided to the Court).
Company's arguments:
4. (a) The market in which the Company operates has experienced
a dramatic decline in the last number of years. The
building industry is going through the worst depression
in its history. Coupled with this, the Company is also
facing stiff competition with the emergence of
additional competitors in the past number of years.
This position has led to a falling of prices, plunging
the Company into serious losses. Since 1982 the Company
has had to rationalise its operations to cope with the
collapsing marking.
(b) The Company maintains that the overall remuneration
package compares very favourably with the highest paying
competitors, while other competitors have labour costs
significantly lower. The Company is not seeking to
reduce existing benefits/remuneration over that of its
competitors, but they do feel justified in seeking to
have labour costs that do not damage competitiveness.
(c) The Company recognises that the Union's claim for an
overall enhancement to the pension scheme is not
unreasonable and indeed is in line with its own
philosophy in improving conditions generally, however
the pension cannot be enhanced in a loss making
situation. The Company recognises that it is seeking a
sacrifice from its employees but believes that this is
justified in the longer term interests of the Company's
survival. If the market situation changes the Company
is willing to re-open negotiations with a more
favourable response.
RECOMMENDATION:
5. The Court notes that the Company accept the validity of the
claim and is agreeable to renew negotiations when its trading
position is more favourable.
The Court accordingly recommends that the Union defer
pursuing the claim and that both parties should keep the
position under review.
~
Signed on behalf of the Labour Court.
Evelyn Owens
__19th__January,__1987. __________________
B. O'N. / M. F. Deputy Chairman