Labour Court Database __________________________________________________________________________________ File Number: CD87499 Case Number: LCR11338 Section / Act: S67 Parties: A.C.C. - and - ACTSS |
Claim on behalf of approximately 260 clerical and administrative workers for a pay increase under the 26th wage round.
Recommendation:
6. The Court, having considered carefully the submissions of the
parties and the current financial position of the Corporation
recommends that an increase of three per cent should be applied to
salaries with effect from 1st June, 1987 and that this increase
should last until mid 1988 when the parties should meet to discuss
pay in the light of the situation obtaining then.
Division: CHAIRMAN Mr McHenry Mr O'Murchu
Text of Document__________________________________________________________________
CD87499 THE LABOUR COURT LCR11338
CC87538 INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
RECOMMENDATION NO. LCR11338
Parties: AGRICULTURAL CREDIT CORPORATION PLC
and
AMALGAMATED TRANSPORT AND GENERAL WORKERS' UNION
Subject:
1. Claim on behalf of approximately 260 clerical and
administrative workers for a pay increase under the 26th wage
round.
Background:
2. The 25th wage round for the workers expired on 30th November,
1986. In November, 1986 the Union on behalf of the workers
submitted a claim for a pay increase in respect of the 26th wage
round. The Union's claim is:
- for a substantial increase in pay in conformity with
I.C.T.U. policy on the 26th Round,
- that the tremendous savings which have accrued to the
Company arising from the reduction in staff of more
than 40% should be reflected in the members' salaries
following the application of the 26th Round.
3. The claim for an increase was rejected by the Corporation and
as no agreement could be reached at local level the matter was
referred to the conciliation service of the Labour Court.
Conciliation conferences were held on 22nd May, 1987 and 12th
June, 1987 at which agreement could not be reached. On 16th June,
1987 the matter was referred to the Labour Court for investigation
and recommendation. The Court investigated the dispute on 14th
July, 1987.
Union's arguments:
4. (i) A 26h wage round increase in line with I.C.T.U.
guidelines should be awarded. Pay increases in recent
years have been less than the rate of inflation and
there have been severe cutbacks in benefits applied to
the workers (details supplied to the Court). The
average increase in industry for the 26th wage round is
approximately 6% to 7% (details supplied to the Court).
(ii) The workers have fully co-operated with major changes
in work practices and in a programme of staff cutbacks
introduced in 1982. This has resulted in a reduction
in numbers from over 700 to under 400, (which will be
further reduced) a decrease of over 40%. Savings in
payroll costs from this programme amount to more than
#4m per annum, none of which has been shared with the
workers. The Corporation's position that finances have
required this reduction in the workforce is misleading
as it has been due to the introduction of
computerisation. The workers have no job security and
reduced promotional prospects.
(iii) Unlike many other semi-state companies the Corporation
is not in a loss-making situation and with the
exception of a few years in the mid seventies has
traded profitably since its foundation. The
Corporation's final accounts and Annual Report for 1986
(details supplied to the Court) show that the last ten
years have been profitable for the Corporation. Recent
reductions in interest rates will improve profits by
over #1m per annum for each 1% reduction.
(iv) The Corporation's argument that a pay freeze is
necessary to protect the employment of the workers is
not acceptable. Further, the Company has advised the
Union that it is not prepared to go to binding
arbitration in the event of either side rejecting the
Labour Court recommendation. This would be a breach of
the in-house Procedure Agreement and is a clear sign of
the Corporation's attitude to the issue.
Corporation's arguments:
Due to the confidentiality of the information supplied by the
Corporation in its submission to the Court, it was agreed that the
Corporation would supply a summary of its case for inclusion in
the recommendation. This is set out below.
5. (a) Since the beginning of this decade, the Corporation has
experienced an exceptional downturn in business.
Farmers began to have genuine difficulties meeting the
repayments on their loans. The major Banks also
experienced serious problems with their farmer
customers, but they had other profitable lines of
business which helped to offset these problems. ACC
was particularly badly hit because it is confined to
lending to the agricultural sector. The recession
which affected most sectors of the economy has been
prolonged in agriculture. Farm incomes fell by 11% in
1986 and the fall is predicted to continue.
(b) As far back as 1981, ACC began to reduce staff numbers,
cut overhead costs and take various other measures to
deal with arrears and bad debts. Staff numbers were
reduced by 45% between 1981 and the end of 1986 by
voluntary means. The scope for further savings in
overhead costs without resorting to compulsory
redundancy and or cuts in benefits is limited.
(c) The Corporation has been able to meet increasing
overhead costs including the cost of the 24th and 25th
Pay Rounds by reducing staff numbers, by cutting non
pay expenditure and by means of special assistance and
guarantees from the Government. Details were provided
to the Court. Current levels of business and
projections for the future make it clear that a pay
freeze is essential.
(d) The pay and conditions of ACC employees are still
extremely good. The Corporation has managed to
maintain staff benefits and has managed to avoid
compulsory redundancies and compulsory transfers. It
is inevitable however that there will be severe
pressure on these areas if there are further costs
which cannot be met from the Corporation's own
resources.
RECOMMENDATION:
6. The Court, having considered carefully the submissions of the
parties and the current financial position of the Corporation
recommends that an increase of three per cent should be applied to
salaries with effect from 1st June, 1987 and that this increase
should last until mid 1988 when the parties should meet to discuss
pay in the light of the situation obtaining then.
~
Signed on behalf of the Labour Court
John M Horgan
--------------
Chairman
24th July, 1987
U.M./J.C.