Labour Court Database __________________________________________________________________________________ File Number: CD87239 Case Number: LCR11262 Section / Act: S67 Parties: TURNEX LTD - and - ITGWU |
Claims on behalf of 23 general workers for:- (a) the introduction of a pension scheme (b) the improvement of the sick pay scheme.
Recommendation:
5. In light of the submissions made by the parties the Court is
of the opinion that even given the stringent financial situation
the necessary initial steps to establish a pension scheme, if
necessary a contributory scheme, should be taken. As a matter of
priority, cover in the event of death in service should be
provided. The Court so recommends.
The Court is further of the opinion that the provisions of the
sick pay scheme should be improved but recommends that
negotiations on the extent of such improvements take place at the
termination of the current wage agreement.
Division: Mr O'Connell Mr Collins Mr O'Murchu
Text of Document__________________________________________________________________
CD87239 THE LABOUR COURT LCR11262
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
RECOMMENDATION NO. LCR11262
PARTIES: TURNEX LIMITED
(REPRESENTED BY THE FEDERATED UNION OF EMPLOYERS)
AND
IRISH TRANSPORT AND GENERAL WORKERS' UNION
Subject:
1. Claims on behalf of 23 general workers for:-
(a) the introduction of a pension scheme
(b) the improvement of the sick pay scheme.
General Background:
2. The claims, which were raised during the 26th wage round
negotiations were lodged by the Union on 18th March, 1986.
Negotiations took place at local level but no agreement was
reached. In April, 1986 these matters, along with full 26th wage
round claims, were referred to the conciliation service of the
Labour Court. Conciliation conferences were held in May and
September, 1986. While agreement was reached on the pay element
of the 26th wage round no agreement was reached on the claims here
concerned. Towards the end of 1986 the Union sought a referral of
these claims to the Court for investigation and recommendation.
and in March, 1987 the Company agreed to same. A Labour Court
hearing was held on 12th May, 1987, in Waterford.
Claim (a) - the introduction of a pension scheme.
Background:
3. The Union is claiming the introduction of a pension scheme as
set out in Appendix 1 to this recommendation. The Company
rejected the claim mainly on the basis that the cost could
not be met in addition to the cost of the wage round
increase.
Union's arguments:
4. (i) During the era of National Agreements the Employer
Labour Conference stated that the provision of a
pension scheme was a basic condition of employment and
that where schemes were not in operation they should
be introduced. It was further stipulated that where
existing pension provisions were inadequate they
should be improved. The Labour Court has supported
this view in many recommendations concerning pensions
issued over many years.
(ii) The Union considers that the Company would further
procrastinate the matter if the Court were to
recommend the introduction of a scheme and not specify
its terms. The Union asks the Court to be specific
and to recommend the introduction of the scheme
proposed by the Union.
Company's arguments:
5. (a) The introduction of a contributory pension scheme would
add 4% to 7% to labour costs depending on the type of
scheme. Given the current position in the marketplace,
and while agreeing in principle to the introduction of
a scheme, the Company does not consider that the time
is opportune for taking on a major additional cost.
(b) The current wage agreement represents the limit of
additional cost which can be borne by the Company at
this time. The introduction of a pension scheme in the
future would place limits on the Company's ability to
negotiate improvements in other conditions.
Claim (b) - the improvement of the sick pay scheme.
Background:
6. The Company operates a contributory sickness benefit scheme
which provides for the services of a Company doctor and for
payment of benefit to employees during absence from work due
to illness or injury at work. Details of the current scheme
are in Appendix 2 of this recommendation. The Union is
claiming that the scheme should be improved by an increase in
the level of benefit payable. Details of the scheme proposed
by the Union are in Appendix 3 to this recommendation. The
Company rejected the claim.
Union's arguments:
7. (i) The acceptance that proper sick pay provisions were
not fringe benefits but essential conditions of
employment was confirmed over the past ten years
through the inclusion in National Agreements of
specific clauses providing for the introduction or
improvements of sick pay schemes.
(ii) In a number of Labour Court Recommendations the Court
has favoured the terms as claimed by the Union or in
some cases exceeding those terms (Labour Court
Recommendations Nos. 3395, 3487, 4196, 4939, 5007 and
7032 refer).
Company's arguments:
8. (a) The Company has a fundamental objection to the scheme
proposed which is so designed that an employee can be
in receipt of a greater amount when absent than when
attending for work.
(b) The sick pay scheme as currently in operation has merit
and is in line with schemes generally.
RECOMMENDATION:
5. In light of the submissions made by the parties the Court is
of the opinion that even given the stringent financial situation
the necessary initial steps to establish a pension scheme, if
necessary a contributory scheme, should be taken. As a matter of
priority, cover in the event of death in service should be
provided. The Court so recommends.
The Court is further of the opinion that the provisions of the
sick pay scheme should be improved but recommends that
negotiations on the extent of such improvements take place at the
termination of the current wage agreement.
~
Signed on behalf of the Labour Court
John O'Connell
___________________________
Deputy Chairman
19th June, 1987
T.O'M./M.F.
APPENDIX I
Pension scheme claimed by Union
APPENDIX I
PROPOSED PENSION SCHEME
Eligibility: All full-time permanent employees of the
company.
Qualifying age: 21.
Contributions: Employees:- 4% of pensionable salary
Employers:- The balance: exact amount
to be disclosed annually.
Normal pension age: 60.
Pension benefit: 1/60 of pensionable salary per year of
service.
(Social Welfare additional - no deductions
in respect of state benefits).
Pensionable salary: Defined as gross earnings - i.e. basic pay
plus shift premia, bonus payments, overtime, commission and any
other emoluments.
Final pensionable salary: Gross earnings at time of retirement
(unless earnings were higher at some previous time - e.g. in the
case of former shift workers - in which case the updated
equivalent of these will be used).
Cash option: On retirement, part of the pension may be exchanged
for an immediate cash sum: for each #100 p.a. of pension
exchanged, about #900 in cash will be payable (in current terms:
these may require alteration in the future).
The limit on the amount of cash that can be taken is 1.50 times
final pensionable salary, provided that you have 20 years' service
by normal pension date. For members with shorter service, a
reduced scale will apply.
Early retirement:
(a) Due to ill-health or disablement: Under the income
continuance plan, the company will provide an income equal
to two-thirds of the person's gross earnings prior to
illness/disability, updated in line with all wage
increases, until normal retirement age.
The Company will also continue its own contributions to the
pension and mortality scheme on behalf of the member
concerned; and under the Income Continuance Plan the
member's own contributions will also be maintained so that
he/she remains covered for the normal range pension and
death benefits.
(b) For reasons other than incapacity: Normal pension will be
payable, based on pensionable service and pensionable
salary at retirement, but actuarially reduced to take
account of age at retirement.
Death in service
(a) Lump sum of four times annual pensionable salary, plus a
refund of contributions;
(b) Survivors'/dependents' pension of two-thirds of member's
expected pension at normal retirement age (this may be
increased to 100% if there are 2 or more dependents);
(c) Survivors'/Dependents' pension to be increased annually in
line with cost-of-living increases;
(d) Survivors'/Dependents' pension to be payable irrespective
of the sex of the member.
Death after retirement
(a) Balance, if any, of 5 years' pension;
(b) as for Death in Service
(c) as for Death in Service
(d) as for Death in Service
Post-retirement increases
Pensions will be increased annually by 5% (or the amount of
increase in the Consumer Price Index, if less). If inflation
exceeds 5%, there will be an annual review to determine the amount
of any additional increases: these will be payable out of the
company's current revenue and will match the balance of the
increase in the C.P.I. in full, unless the company is in a
loss-making situation.
APPENDIX II
Details of the present sickness benefit scheme
APPENDIX II
TURNEX LIMITED
SICKNESS BENEFIT SCHEME FOR HOURLY PAID EMPLOYEES
A Company Doctor will be available to all Turnex Ltd. employees
from whom free medical attention can be obtained. (This does not
include employee families or prescription costs etc.)
A death in service cover of #2,000 exists for each member.
Sick Pay Fund
A committee of four, comprising of two management and two staff
nominees will be responsible for the administration of the fund.
It is a condition of employment that all hourly paid employees
shall join and remain in the scheme.
The sick fund to be established with employees and the company
each contributing 30p per week. Contributions will be deducted at
source.
The Company will make a once only initial payment of #200 to the
fund, otherwise the fund is unguarranteed.
A bank account will be opened to which all contributions will be
lodged on a monthly basis. The signature of all committee members
will be approved for cheque endorsement, however, each cheque must
be signed by one of managements and one staff nominee.
Payments from the fund will in no case exceed what take home pay
would have been if at work, taking into account, state benefit,
tax refund and fund payment.
Individuals to ensure when sick that the appropriate claim is
registered with the Department, so as not to prejudice future
claims.
Application for sick pay benefit will only be considered on the
approved application form, supported by the relevant medical
certificates, and payments made only on the committees endorsed
approval of same.
Endorsement will be in the same format as that of the cheque
payment.
The committee reserve the right to contact the doctor, or refer to
the Company doctor before payments are made.
Payments from sick fund will only be made on the day when normal
payment of wages would have been made.
An individuals maximum claim on the fund will not exceed six weeks
payments in a twelve month period. (The twelve month period is
deemed to be the twelve months preceding each claim).
Sick Fund Entitlements
A) Benefit from scheme to cover a maximum of six weeks (30 days)
Week 1 - #20 (#4/day)
Week 2 - #15 (#3/day)
Week 3 - #10 (#2/day)
B) No payment from fund for first 2 days of illness.
C) A qualifying period of 6 months service to apply for benefit
eligibility.
Injury Benefit (Certified absence due to injury at work).
Application form for injury benefit will be available and the
administration will be the same as for Sickness Benefit.
Employees will be entitled to draw the normal weekly net take home
pay as if at work, less tax rebate.
Onus will be on the employee to apply for and ensure that all
S.W.I. entitlements are refunded direct to the fund.
Benefit will commence from the first day of absence.
No qualifying period required for eligibility.
Payment initially up to 2 weeks, thereafter payments subject to
review and agreement by administering committee.
If in the opinion of the committee, and supported by the doctor,
the injury is considered to be slight, the Company may be in a
position to offer "light work" to the injured person. In such a
case the employee would be expected to accept such work. This
would reduce a possible unneccessary extended drain on the fund.
The Right is reserved to curtail payments if the Company safety
rules are not observed.
Absence through injury due to misconduct automatically
disqualifies for fund payments.
The scheme to commence on the 1st May, 1980 and all contributions
will be transferred to the relevant bank account monthly
thereafter.
Agreed 30/4/80
RON I. CHEDGEY __________________ J. B. WALSH
H. A. McLAUGHLIN ________________ J. COLLOPY
APPENDIX III
The sick pay scheme proposed by the Union
APPENDIX III
PROPOSED SCHEME FOR TURNEX
1. ELIGIBILITY
The Scheme shall apply to all employees of the Company who
have completed three months employment with the Company and
who are absent from work due to certified illness or
industrial accident. Any period of illness which commenced
prior to the introduction of the scheme will not be covered.
2. SCOPE
Absences of one or two days will not qualify for benefit.
Absences of three days or more will be treated as follows:
a) First Absence - will be covered in full.
b) Second Absence - the first day of the absence
will not attract any benefit.
c) Third Absence - the first two days of the
absence will not attract any
benefit.
d) Fourth and the first three days of the
subsequent absence - absence in any year will not
attract any benefit.
3. BENEFIT
a) Benefit shall consist of full pay (defined as the
personal rate of the employee including shift premia but
excluding bonus) less social welfare benefit payments
(disability or occupational injury benefit and pay
related benefit).
b) Benefit shall be payable for a maximum of twelve weeks
in any benefit year. The benefit year shall extend from
1st November in one year to the 31st October of the
following year. The first benefit year shall commence
on 1st November, 1982.
4. CERTIFICATION
To qualify for benefit a medical certificate must be
submitted to the Company at the commencement of the period of
illness.
It shall be a condition of payment of benefit that social
welfare benefit be claimed and the social welfare cheque
submitted to the Company within two days.
5. The Company will have the right to refer for medical opinion
to a doctor of its choice any member whose absences are
deemed to be excessive.
6. CONTRIBUTION
The full cost of the scheme will be met by the Company.
7. The scheme is to operate for a trial period of six (6)
months, following which its operation will be reviewed.