Labour Court Database __________________________________________________________________________________ File Number: CD87610 Case Number: LCR11414 Section / Act: S67 Parties: IRISH SUGAR CO. - and - CRAFT GROUP;NEETU |
Claim under the 26th wage round, a review of rates in comparable companies, and a wage increase.
Recommendation:
7. The Court having considered the submissions from the parties
recommends the following increase in relation to the 26th round
pay round claim:
3% from 1st April, 1987
a further
1% from 1st November, 1987
and a further final phase of 1% from 1st January, 1988.
Agreement to terminate on 31st March, 1988.
The Court has also given careful consideration to the other items
claimed and does not recommend concession at this time.
Division: Ms Owens Mr Shiel Ms Ni Mhurchu
Text of Document__________________________________________________________________
CD87610 THE LABOUR COURT LCR11414
CC871145 INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
RECOMMENDATION NO. LCR11414
Parties: SIUICRE EIREANN C.P.T.
and
CRAFT GROUP UNIONS
Subject:
1. Claim under the 26th wage round, a review of rates in
comparable companies, and a wage increase.
Background:
2. The claim concerns 270 craftsmen employed by the Company at
its production plants at Carlow, Mallow Thurles and Tuam. The
current craft pay scale ranges from #174.67 to #200.16 per 40
hours. Service pay is also applicable to certain workers.
3. The 25th wage round terminated on 31st December, 1986. On the
6th May, 1987 the Unions claimed a review of rates in comparable
companies, a 10% wage increase, reduction in the working week and
an increase in intake of apprentices. The Company rejected the
Unions' claim and offered a 2 year agreement from 1st January,
1987 with a 2% wage increase from 1st July, 1987 and a 2% wage
increase from 1st April, 1988. The Unions rejected this offer.
4. No agreement was reached at local level and on 20th July, 1987
the matter was referred to the conciliation service of the Labour
Court. A conciliation conference was held on 29th July, 1987.
The Company modified its offer at the conference to a 15 month
agreement from 1st January, 1987 with a 3% wage increase over
seven months from 1st April, 1987 and a review in December, 1987
to determine a second phase increase which would be effective from
1st November, 1987. The Unions rejected this offer. No further
agreement was possible through conciliation and on 4th August,
1987 the case was referred to the Court for investigation and
recommendation. A Labour Court hearing was held on 3rd September,
1987.
Union's arguments:
5. (i) Since 1977 the workers rates of pay have been
determined by the average rates of pay of nine
comparable companies. In that time the Labour Court
has issued five recommendations concerning the question
of a comparability increase. Under LCR 10,286 the
Court while recommending a flat percentage pay
agreement stated in its recommendation "This does not
mean that that the Unions must give up the right to
compare the pay of their members in C.S.E.T. with the
pay of craftsmen in other similar employments. That
can continue to be one of the factors governing
settlements but for the immediate future at least it
should not be the sole criterion as it was under the
1982 agreement."
The workers' salary scales are approximately #7 out of
line with the average craft rates in the nine
comparable companies. In order to maintain comparison
it would be necessary to implement an additional pay
increase.
(ii) The Company employed over 400 craftsmen at the time
Labour Court Recommendation No. 5004 was issued.
However, through rationalisation its numbers have
dropped to 270 at present.
(iii) The Company argument of difficult financial
circumstances does not hold up, as extracts from their
Annual Reports since 1982 indicate a trading profit as
follows:
Year Trading Profit
1982 3 million
1983 10 million
1984 14 million
1985 10 million
1986 12 million
(iv) The Company's offer is totally unsatisfactory and its
attempt to hide behind Government pay guidelines will
make no impact.
(v) Average settlements, as reported by Industrial
Relations News and studies made by the I.C.T.U.,
indicates current trends in wage settlements to be
running at 5%-6% on an annualised basis.
Company's arguments:
6. (a) The Company has accumulated heavy losses since 1980 and
is still very short of the cash resource necessary to
continue the modernisation programme which is
absolutely essential to future competitiveness and
survival. To fund this programme we would need profit
levels of at least #10 million per annum in addition to
the further equity injection of #9 million outstanding
from the State.
(b) The Company which trades in home and foreign markets
has not got a monopoly market and is very vulnerable to
foreign competition. The control of costs in order to
improve competitiveness is absolutely essential to the
Company's survival and future. Cost increases which
cannot be recovered in the market place will inevitably
lead to further rationalisation and job loss.
(c) The Company is a commercial Semi-State Company must
comply with the Government's 26th wage round
guidelines.
(d) The Unions' arguments for a pay increase to reflect
26th wage round settlements in the private sector or
current rates in specified outside companies are
irrelevant in that it is the Company's financial/market
situation that has to determine what it can or cannot
afford.
(e) Craft rates over the 24/25th round periods increased by
18.29% whereas the Consumer Price Indexi (C.P.I.) over
the same period amounted to less than 12.5%. The
forecast year on year increase in C.P.I. is estimated
at 3% and accordingly the Company offer would still
leave the cumulative wage increases above the C.P.I.
increases over the period covering the 24th/26th wage
rounds. In the circumstances the Company's offer
clarified as a fifteen month agreement (1st January,
1987 to 31st March, 1988) with a 3% wage increase from
1st April, 1987 and a 1% wage increase from 1st
November, 1987 is fair and reasonable.
RECOMMENDATION:
7. The Court having considered the submissions from the parties
recommends the following increase in relation to the 26th round
pay round claim:
3% from 1st April, 1987
a further
1% from 1st November, 1987
and a further final phase of 1% from 1st January, 1988.
Agreement to terminate on 31st March, 1988.
The Court has also given careful consideration to the other items
claimed and does not recommend concession at this time.
~
Signed on behalf of the Labour Court
Evelyn Owens
________________________
Deputy Chairman
10th September, 1987
P.F./J.C.