Labour Court Database __________________________________________________________________________________ File Number: CD87517 Case Number: LCR11395 Section / Act: S67 Parties: JOHNSON BROTHERS - and - ITGWU |
Claim, on behalf of approximately forty general operatives, for an increase in both basic and service pay under the 26th wage round.
Recommendation:
5. The Court is of the view that the Company's offer is fair in
the circumstances and should be accepted.
The Court so recommends.
Division: Ms Owens Mr Heffernan Ms Ni Mhurchu
Text of Document__________________________________________________________________
CD87517 THE LABOUR COURT LCR11395
CC87637 INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
RECOMMENDATION NO. 11395
Parties: JOHNSON BROTHERS LIMITED
(Represented by the Federated Union of Employers)
and
IRISH TRANSPORT AND GENERAL WORKERS' UNION (NO 3 BRANCH)
Subject:
1. Claim, on behalf of approximately forty general operatives,
for an increase in both basic and service pay under the 26th wage
round.
Background:
2. The 25th wage round for the workers concerned expired on the
31st December, 1986. At a local level meeting on the 1st
December, 1986 the Union sought an 8% increase in basic rates for
a twelve month period, a shorter working week and an increase in
the current service pay arrangement. The Company responded on the
6th January, 1987, by offering:
- 2% from 1/1/87,
- 2% from 1/7/87 to 31/12/87 (12 month agreement),
- no reduction in the working week,
- no increase in service pay.
This was unacceptable to the Union and at a meeting on the 9th
February the Company amended its offer viz:
- 2% from 1/1/87 for six months,
- 3% from 1/7/87 for a further six months,
- increase in service pay as follows:
Present Proposed
5 years #0.75 #1.00 (+33%)
10 years #1.00 #1.50 (+50%)
15 years #1.25 #2.00 (+60%)
20 years #1.50 #2.50 (+66%)
25 years #2.00 #3.50 (+75%)
The Union agreed to recommend this package for acceptance but it
was rejected by the claimants. On the 23rd March the Company made
another offer which provided for the above terms in addition to
#100 retrospection in respect of the period January - March (the
average would have worked out at #65). This too was rejected by
the workers and the matter was referred to the conciliation
service of the Labour Court on the 21st April, 1987. No progress
was made at a conciliation conference held on the 29th May and the
matter was referred to the Labour Court for investigation and
recommendation. A Court hearing took place on the 20th August,
1987.
Union's arguments:
3. (a) The claimants' basic rates are comparatively very low,
i.e. #112 to #114 per week. Earnings are improved by
fixed bonuses at #59.80 and fluctuating bonuses varying
from #75 to #170. Bonus payments are not guaranteed and
are subject to possible reduction in the future.
(b) Concession of the Union's claim would enhance both
overtime payments (although overtime is kept to a
minimum) and pension entitlements.
(c) The Union contends that a payment of 6% on a phased basis
(two 3% phases) for twelve months, is not an
insurmountable problem for the Company. It is very
successful and has acquired a number of agencies from
companies who have either reduced or eliminated their own
transport fleets. It has developed a reputation for
being reliable and efficient and is likely to gain
further business in the future.
(d) 26th round settlements in comparable companies have given
6% (details supplied to the Court).
Company's arguments:
4. (a) The Company has been fortunate in that it has been able
to secure two additional distribution contracts since the
start of 1987. However, it must be borne in mind that
these contracts were secured in the face of very stiff
opposition. The tenders submitted by the Company were
based on a budgeted increase in cost/expenses of 5% over
1987. The offer made by the Company to the Union on
23/3/1987 clearly extends beyond that budgeted figure and
must be compensated for elsewhere.
(b) Currently the Company is showing increased turnover but
profit levels have declined due to pressure on margins.
During the financial year 1985/1986 sales levels
increased by 3.7%, whilst profit before interest and tax
fell by some 9%. The Company position has been further
affected by the fact that the levels of interest payable
during the same period rose by 4% due to the necessary
extension of credit facilities on some major accounts,
and that nationally the retail trade has retrenched with
retail sales falling by 0.6% in 1986.
(c) Costs have been rising steadily in recent years, in
particular insurance charges and distribution costs
(details supplied to the Court).
(d) The remunerative package currently available to the
workers concerned is very generous and has increased
significantly over the 1984/1987 period (details
supplied). It is noteworthy that of the three categories
of workers involved in this claim (warehouse staff, van
drivers and forklift drivers), only the van driver rates
incorporate inbuilt overtime and in the case of the
warehousemen there is a salary range of #10,000 -
#16,000. A 'case productivity scheme' applies in the
warehouse which affords maximum earnings opportunity.
Furthermore, a 'pallet bonus' is payable to each driver
for every load delivered over and above the first load
taken out on any one day.
(e) The claimants enjoy twenty days annual leave plus an
additional week after twenty years' service, an average
purchase of #5/#10 per week of Company goods, and a
sickness benefit scheme which ranges from five days
benefit for those with six months' service to 25 days
benefit for those with over ten years' service.
(f) It must also be said that the Company entered into
negotiations at a time when inflation was reported at
3.4%. This has since fallen to 2.8% for the year ending
May, 1987, something from which the Union may be said to
have gained an additional .50%. Furthermore, this dispute
is before the Court at a time when very many companies
are concluding agreements for 3.50%/4% for 1987 pay in the
private sector.
RECOMMENDATION:
5. The Court is of the view that the Company's offer is fair in
the circumstances and should be accepted.
The Court so recommends.
~
Signed on behalf of the Labour Court
3rd September, 1987
DH/PG Evelyn Owens
Deputy Chairman