Labour Court Database __________________________________________________________________________________ File Number: CD88162 Case Number: LCR11967 Section / Act: S67 Parties: DUBARRY SHOES LIMITED - and - IRISH TRANSPORT AND GENERAL WORKERS' UNION |
26th Wage Round.
Recommendation:
5. The Court having regard to all the circumstances of the case
recommends that the terms of pay agreement reached under the
National Programme for Recovery be implemented with effect from
1st December, 1987. The Court further recommends that the parties
continue negotiation on the introduction of a pension and sick pay
scheme during the currency of the agreement.
Division: CHAIRMAN Mr Heffernan Ms Ni Mhurchu
Text of Document__________________________________________________________________
CD88162 RECOMMENDATION NO. LCR11967
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67
PARTIES: DUBARRY SHOES LIMITED
and
IRISH TRANSPORT AND GENERAL WORKERS' UNION
SUBJECT:
1. 26th Wage Round.
BACKGROUND:
2. The 25th wage round expired on 30th September, 1987 and the
Union submitted a 26th wage round claim for a 7% increase in wages
for 12 months, a shorter working week, the introduction of a new
pension scheme and the introduction of a sick pay scheme. The
Company sought an eighteen month pay freeze and indicated that it
was not in a position to negotiate on the Union's claims (the
claim for a shorter working week was set aside in the context of
the Plan for National Recovery). As no settlement could be
reached at local level talks, the matter was referred to the
conciliation service of the Labour Court. No agreement was
reached at a conciliation conference held on 16th February, 1988
and the matter was referred to the Labour Court for investigation
and recommendation. A Court investigation into the dispute was
held in Galway on 29th March, 1988. The Court requested the
accounts of the Company for the years 1984 to 1987. Group
consolidated accounts only were submitted.
UNION'S ARGUMENTS:
3. 1. The Company has refused to negotiate at all on the 26th
wage round claims.
2. Under the 26th Wage Round there were approximately 774
settlements with an annualised increase of approximately 6%.
During that Round there were 77 settlements with pay pauses of
which 38 included a payment in lieu of the pause. The average
duration of settlements was 13.7 months. There were over 100
Labour Court Recommendations and the annualised increase
recommended by the Court was 5.08%. Where the employers
refused to make any offer, the Court recommended as high as
6%. The Union is not aware of any instance where an eighteen
month pay pause was conceded.
3. 3. The Company is the most prominent shoe manufacturer in
this country and to the knowledge of the Union is doing quite
well at the moment. It is about to move into new premises
which indicates the high esteem in whcih it is held by the
Industrial Development Authority and other financial
institutions. However, it should not expect the workers to
finance the new premises. The workers are, and have always
been, willing to co-operate fully with the Company and are
most anxious to be part of any new developments. At the same
time, however, the Union must ensure that the workers' buying
power is not eroded and that their wages reflect the high
position that the Company maintains in the market place.
4. The clerical workers in the Company are in a pension
scheme. The workers here concerned would be prepared buy into
this scheme.
5. The Union is prepared to negotiate a sick pay scheme
with the Company.
COMPANY'S ARGUMENTS:
4. 1. The Company now accounts for approximately 25% of an
industry that in 1981 employed over 7,000 workers in this
country. The majority of shoe manufacturers ceased operations
in Ireland because of their inability to establish viable
concerns because of the highly competitive nature of the
industry.
2. During the last wage negotiations in March, 1986 the
Company informed the Labour Court that its only hope was to
completely modernise its operation and that it proposed to
submit comprehensive plans to the IDA. The proof of this
sincerity is that the Company's new premises is opening in the
next 4 to 6 weeks. While the Company is convinced that this
investment was vital for its long term survival and growth, a
serious downturn in the Company's performance caused by a
severe contraction at Irish retail level has meant that this
same investment could, if the Company is not prudent, cause
its downfall. No consideration can be given to a wage or
salary increase until this threat has subsided. The Company
is not therefore asking the workforce to pay for the new
premises.
3. Wage settlements in the Company over the years have
resulted in levels which are well in excess of those elsewhere
in the footwear trade and also in other companies in the
locality. The labour cost element is a vital aspect of the
footwear operation and it is necessary to keep within
reasonable limits to protect employment. The high wage rates
paid by the Company reflect a disadvantage to the Company in
the marketplace. The Company is competing in a market where
93% of sales are imported and the majority of these imports
come from low cost countries.
4. 4. With inflation at 1.9% and falling and given the present
wages of the workers it is not unreasonable for the Company to
expect its workforce to accept the proposed pay freeze.
5. The Company can give no consideration to a pension
scheme at this time because of its financial situation. The
Operative Pension Scheme failed in 1986 and all money
invested by the Company, and most invested by the workers, was
lost. This failure was not the fault of the Company. The
Company continued deductions and contributions to put towards
a new scheme. The Union now wants all available monies
outstanding returned to the workers.
6. The Company is prepared to offer to the officers of the
Court audited evidence of its 1987 profit performance and the
extent of the Company's borrowings.
7. Having examined the whole question of a sick pay scheme
the Company feels justified in refusing to implement one.
RECOMMENDATION:
5. The Court having regard to all the circumstances of the case
recommends that the terms of pay agreement reached under the
National Programme for Recovery be implemented with effect from
1st December, 1987. The Court further recommends that the parties
continue negotiation on the introduction of a pension and sick pay
scheme during the currency of the agreement.
~
Signed on behalf of the Labour Court
21st July, 1988 John M. Horgan
R.B./U.S. Chairman