Labour Court Database __________________________________________________________________________________ File Number: CD87476 Case Number: LCR11387 Section / Act: S67 Parties: BAILIBORO FOUNDRY - and - ITGWU |
Claim under the 26th wage round, for a wage increase and improved service pay.
Recommendation:
7. In the light of the submissions made by the parties the Court
recommends that the employer's offer be amended to provide an
increase of 4% with effect from the 1st September, 1987 in respect
of an agreement to terminate on 1st August, 1988, and that the
amended offer be accepted by the workers concerned.
Division: Mr O'Connell Mr McHenry Mr O'Murchu
Text of Document__________________________________________________________________
CD87476 THE LABOUR COURT LCR11387
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
RECOMMENDATION NO. LCR11387
Parties: BAILIEBORO FOUNDRY
and
IRISH TRANSPORT AND GENERAL WORKERS' UNION
Subject:
1. Claim under the 26th wage round, for a wage increase and
improved service pay.
Background:
2. This claim concerns approximately eighty general workers
employed by the Company which manufactures baths and other cast
iron items. The last wage round expired in the Company on 31st
December, 1986. The Union considers that the wage round now under
discussion is the 26th wage round but the Company considers it is
the 27th wage round.
3. The present weekly basic rates of pay are general foundry
operative - #141.45 (70 workers), Dressing shop - #143.75 (7
workers) and enamellers #144.75 (3 workers). The present service
pay is #20.00 per annum after four years service and #25 per annum
after 5 years service. In January, 1987 the Union claimed a #14
per week wage increase over twelve months from 1st January, 1987
and an improvement in the service pay scheme. The Company
rejected the claim.
4. No agreement was reached through local negotiations and on 3rd
April, 1987 the case as referred to the conciliation service of
the Labour Court. A conciliation conference was held on 20th May,
1987. The Company made an offer which involved, a 9 months pay
pause followed by a 3% wage increase over 12 months from 1st
October, 1987 as part of an agreement of 21 months duration. The
Union rejected the offer and no agreement was reached. On 12th
June, 1987 the case was referred to the Court for investigation
and recommendation. A Labour Court hearing was held on 29th July,
1987 in Cavan.
Union's arguments:
5. (i) The workers need the full concession of the #14 wage
increase within a 12 month agreement to bring their
wages up to an appropriate level for the type of work
they are involved in.
(ii) The present rates of pay in the Company are well below
the basic rates of most reputable employers in the
area. The fact that none of them are foundries, or
perform anything as dirty and heavy as foundry work,
merely emphasises the inadequacies of the workers'
rates.
(iii) Even if the Company is not making a profit it must find
scope to grant an appropriate pay increase to at least
keep the workers working with Management to overcome
current problems. An investment of this nature in the
staff can pay its own dividends.
(iv) The workers are not easily convinced regarding the
supposed bad trading position of the Company. If the
financial situation is as bad as the Company states
then the Union should be allowed access to the accounts
so as to make a proper assessment of the offers of the
Company.
(v) The Union claims that the present service pay should be
doubled. This claim should be conceded in full.
Company's arguments:
6. (a) The Foundry business has been trading at a loss since
1984. The Company's position is further undermined by
the withdrawal of housing grants, the restrictions on
public sector spending and the increased provisions
which it must make for bad debts.
(b) The Company has consistently over the years,
re-invested any available cash in plant and equipment
in an attempt to modernise and remain in business.
Despite capital expenditure in excess of #.50 million
between 1982 and 1985, the Company is still not in a
competitive position as is evidenced by its recent
failure to win a substantial contract.
(c) The annual wage bill in respect of the I.T.G.W.U.
members is in excess of #600,000. Each 1% wage
increase will cost the Company #6,200 in the full year.
This increased cost cannot be passed on through higher
prices. The increased cost will further undermine the
Company's ability to compete and add to accrued trading
losses.
(d) The Company is not in a position to incur any further
wage cost increases and cannot consider any
retrospection. An increase of 3% from a current date
will not leave anybody worse off as a result of
increases in the cost of living, which are now running
at below 3% over the previous 12 months and projected
to fall further in the coming year. Furthermore, it
must be remembered that any increase in wage costs
cannot be passed on to the consumer through higher
prices. Increased wage costs would further undermine
the Company's ability to retain what business it has
and certainly undermine its ability to tender for new
business. The result can only mean further lay-offs
leading inevitably to permanent job losses.
(e) The Company's proposal of a pay pause and 3% increase
is a reasonable increase in the context of current wage
agreements in the public sector. These are
particularly relevant considering that so much of the
Company's business depends on public sector funding.
In addition, the Company has paid increases over the
years well in line with industry and is only now
seeking restraint by way of a 9 month pay pause
followed by a 3% increase.
(f) In view of the Company's financial situation and
uncertain prospects, the Company cannot and will not
consider any proposal which provides for retrospective
payments and any wage increase in excess of that
offered.
RECOMMENDATION:
7. In the light of the submissions made by the parties the Court
recommends that the employer's offer be amended to provide an
increase of 4% with effect from the 1st September, 1987 in respect
of an agreement to terminate on 1st August, 1988, and that the
amended offer be accepted by the workers concerned.
~
Signed on behalf of the Labour Court
John O'Connell
_________________________
Deputy Chairman
4th September, 1987
T.O'M./J.C.