Labour Court Database __________________________________________________________________________________ File Number: CD88104 Case Number: AD8812 Section / Act: S13(9) Parties: CORAS IOMPAIR EIREANN - and - TRANSPORT SALARIED STAFFS' ASSOCIATION |
Appeal against Rights Commissioner's Recommendation No. CM18018.
Recommendation:
5. The Court has noted that there was not a fall-off in business
in the particular area under the claimant's control. In these
circumstances his transfer was not mainly due to a decline in
business and accordingly the Court upholds the Rights
Commissioner's recommendation in this case and rejects the
Company's appeal.
Division: Mr Fitzgerald Mr Collins Mr O'Murchu
Text of Document__________________________________________________________________
CD88104 APPEAL DECISION NO. AD1288
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67
PARTIES: CORAS IOMPAIR EIREANN
and
TRANSPORT SALARIED STAFFS' ASSOCIATION
SUBJECT:
1. Appeal against Rights Commissioner's Recommendation No.
CM18018.
BACKGROUND:
2. The Union on behalf of the worker concerned in this case
claimed compensation for overtime earnings lost to the worker as a
result of a re-organisation of C.I.E. Tours Department in
December, 1986. It claimed that since he joined the Department in
1970, he earned substantial overtime averaging £3000 a year.
Management's position on the matter was that the worker's loss of
earnings were a direct result of a fall-off in business and
Company policy is not to compensate for earnings lost in such
situations. It claimed that in order to protect the viability of
the Tours Department it had to reduce the numbers working in it
from 56 to 32. Agreement could not be reached on the matter at
local level, and it was referred to a Rights Commissioner for
investigation. On 28th October, 1987, the Rights Commissioner
issued the following recommendation -
"I recommend that he (the worker) be compensated with
half of his 1986 over-time earnings loss, that is a sum
of £1050.06".
On 3rd February, 1988, the Company appealed the Rights
Commissioner's recommendation to the Labour Court under Section
13(9) of the Industrial Relations Act, 1969. A Court hearing took
place in Dublin on 26th February, 1988.
UNION'S ARGUMENTS:
3. 1. The worker was responsible for the home market segment of
the business for which he often (in conjunction with the
Tours Manager) programmed the tours and tabulated the
costings and budgets. During 1986, more tour seats were sold
on the home market than in any other segment of the tours
business. The worker was also responsible for controlling
the international rail traffic to Europe and was involved in
a selling activity during promotional ventures. Furthermore,
the worker was responsible for joint sales tours with the
Company's overseas offices.
2. Since the re-organisation of the Tours Department, the
worker has been allocated to a Sales Representative's
position in the Irish Rail Head Office in Connolly Station
and it has been made clear to him that under no circumstances
will overtime earnings be paid even in situations where
excess hours are worked.
3. The Irish Market Sales work continues to be undertaken
within the Tours Department and the fact is that the same
work, including overtime, (which necessarily arises)
continues to be undertaken by other staff within the Tours
Department.
4. The worker's view is that he was in fact pushed out from
the Department and has suffered a bonafide loss in his living
standards, especially as domestic commitments had been
entered into with the expectancy that his earnings potential
within the Tours Department would continue.
5. In the course of various meetings and indeed during the
Rights Commissioner's Hearing, the Company's representatives
endeavoured to assert that the worker's loss of overtime
earnings was a direct result of a fall off in business and
thus compensation could not be paid in that situation. It is
the Association's contention, however, that the reduction in
staff numbers constituted a re-organisation of the Department
and that such re-organisations are catered for by the terms
of the Clerical and Executive Grades Productivity Agreement.
That Productivity Agreement specifies the arrangements for
release under Voluntary Severance arrangements and the
payment of compensation where the re-organisation gives rise
to a loss in earnings and it is important to mention that
under the re-organisation a member of staff was released
under the Voluntary Severance arrangements and the accrued
saving credited to the Productivity Agreement.
6. It is, therefore, inconsistent for the Company's
representatives to maintain that compensation is not payable
in this instance, particularly as the worker's displacement
arises from the self same re-organisation.
7. In view of all the foregoing the Association earnestly
requests the Court to endorse the Rights Commissioner's
Recommendation which, it should be pointed out, recommends
only a sum equivalent to the average annual loss and does not
take account of the 2½ times formula provided for in the
compensation arrangements contained in the Productivity
Agreement.
COMPANY'S ARGUMENTS:
4. 1. The Company has declined to pay compensation in this case
because the losses incurred are a direct result of a falling
off in business (details supplied to the Court). Drastic
action was needed to maintain the viability of the operation,
and there has been a reduction in permanent staff from 36 to
21 in Dublin, and from 20 to 11 in New York. This had the
effect of staunching the outflow, and reduced the loss in
1987 to £387,000.
2. In his new position, the worker is not in receipt of
overtime but this does not mean he will never work overtime
again. On the contrary, the worker concerned could very well
be working overtime as the Company expands its business.
3. The Company is under constant pressure from the Clerical
and Supervisory Group to reduce the incidence of overtime
working. The Company has no problem with this. Good
Management calls for the reduction of overtime to the
absolute minimum consistent with good service. The work flow
in the Tours Department as in Booking Offices in the Rail
Section or in the Sales Office in Dublin Bus is periodic and
can best be met by overtime working rather than by the
employment of additional staff. However, no one in C.I.E. or
in the constituent companies of the Group has a guarantee of
continuous overtime. Hours of work have to be adjusted to
meet the exigencies of the Service.
4. As regards the statement that the worker concerned
should be compensated in accordance with the Agreement, there
is no such Agreement covering compensation for loss of
earnings arising out of a reduction in business or recession.
There is a Productivity Agreement for Clerical and Executive
Staff which makes provision for the payment of compensation
for loss of earnings arising out of re-organisation but this
Agreement specifically excludes loss of traffic or
retrenchment.
5. The Union contends that the worker's redundancy was
occasioned by re-organisation because work he was doing is
still being carried out in the Tours Section. This is an
over simplification of the position. The Tours Department is
still operating but at a reduced level and so far as the
Dublin Office is concerned with 15 fewer employees. This
means that the work generated by available traffic has to be
spread over the remaining staff. However, this is not a
saving in the sense of productivity but a cost cutting
exercise to maintain the viability of the Tours Section and
the reduction in earnings is not a unilateral gain accuring
to the Company.
6. The worker's loss arises out of loss of traffic and not
as a result of re-organisation for the more efficient and
profitable operation of the Tours Section. It has been
established in industry that Companies are not required to
pay compensation where a loss of earnings is the result of a
reduction in business. Furthermore it has never been the
practice of the Company to pay compensation where a loss of
earnings is a result of a reduction in business, the
recession, cut back in Capital Programme, normal changes in
working, or economies introduced to curtail expenditure
because of the Company's critical financial position.
Similar claims for loss of earnings have been made in the
past and the Court has not seen fit to recommend concession
of the claims for compensation (details supplied to the
Court).
7. The Company submits that the Rights Commissioner was in
error in accepting that the worker's losses were due to
re-organisation which had generated savings for the Company.
There was no re-organisation as such. What has happened is
that to keep the operation afloat the residual work has been
spread over the staff remaining after the Tours Section was
slimmed down by reducing staff numbers in line with the
business offering. The Company further submits that it has
met any obligations it may have to the worker by allowing him
to retain a Company car, and by providing him with employment
in his own grade within the C.I.E. Group. Indeed if the
Tours Section were an independent business such as one of the
many travel firms which have gone under in the course of the
current recession, in all probability the worker would have
been paid off. The Company asks the Court to uphold its
appeal.
DECISION:
5. The Court has noted that there was not a fall-off in business
in the particular area under the claimant's control. In these
circumstances his transfer was not mainly due to a decline in
business and accordingly the Court upholds the Rights
Commissioner's recommendation in this case and rejects the
Company's appeal.
~
Signed on behalf of the Labour Court
21st March, 1988 Nicholas Fitzgerald
P.F./P.W. Deputy Chairman