LCR11856

Subject:
Claim on behalf of approximately 100 workers for an increase in pay under the 27th wage round.

Recommendation:
5. The Court having considered the submissions from both parties
and noting the present financial position of the Company
recommends that:-

(a) the terms of the National Agreement be applied to the
claimants from 1st January, 1988.

(b) payment of arrears due from 1st January, 1988 to 31st May,
1988 should be deferred to the end of 1988.

Division: Ms Owens Mr Heffernan Mr O'Murchu

Text of Document__________________________________________________________________

CD88214 RECOMMENDATION NO. LCR11856


INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67

PARTIES: F.E.I. LIMITED, BAGNELSTOWN AND KILKENNY
(REPRESENTED BY THE FEDERATED UNION OF EMPLOYERS)

AND

FEDERATED WORKERS' UNION OF IRELAND


SUBJECT:
1. Claim on behalf of approximately 100 workers for an increase
in pay under the 27th wage round.



BACKGROUND:
2. The dispute concerns the grades of general operatives, uncoded
welder, and coded welder. The 26th round expired on the 31st
October, 1987. The Company is a registered Irish Company whose
controlling owners are based in New York, U.S.A. It is engaged in
the importation of marble from Italy and preparing it for
installation in building projects in the U.S.A. and U.K. The
employer has been pleading inability to pay the increase because
of financial difficulties. No agreement was reached at at local
level discussions. The dispute was referred to the conciliation
service of the Labour Court on the 13th January, 1988. A
conciliation conference was held on the 17th February, 1988, but
no agreement was reached. A Court hearing took place on the 5th
May, 1988.


UNION'S ARGUMENT:
3. 1. The Union's claim is for the implementation of the terms
of the National Plan from the 1st November, 1987. That plan
was drawn up in order to facilitate companies in the public
and private sectors with difficulties and as a result moderate
increases were recommended and agreed. It is essential that
the increases be applied to our members. There has been no
agreement to alter the National Plan by the Union and the
increases should apply, from the expiry date of the current
agreement.



COMPANY'S ARGUMENT:
4. 1. The Company's financial problems arose because of (i) the
poor exchange rate between the US Dollar and the Punt, (ii)
Underbidding on contracts by the Company in order to obtain a
foothold in the marketplace, (iii) productivity problems at
the Company's plants at Bagnalstown & Kilkenny. The two main
contracts in the USA were the Bank of Baltimore, and Wall
Street contracts. The former held its own and was marginally
profitable, the latter made a loss, which the Company would
find difficult to sustain. Further borrowings amounting to
1.2 million dollars had been made against future contracts,
and if things went well the Company expected cash flow
problems to ease. The Company insists that it is essential to
maintain current rates of pay to salaried and hourly employees
without further increases, if it is to remain financially
sound. The Company did not have an escalation protection
clause and was therefore liable to various increases from
sub-contractors which it had to meet. If the Company
succeeded in obtaining two further contracts there was a
possibility that it would be able to pay the increase at the
end of the year.



RECOMMENDATION:

5. The Court having considered the submissions from both parties
and noting the present financial position of the Company
recommends that:-

(a) the terms of the National Agreement be applied to the
claimants from 1st January, 1988.

(b) payment of arrears due from 1st January, 1988 to 31st May,
1988 should be deferred to the end of 1988.
~
Signed on behalf of the Labour Court.


Evelyn Owens
___13th___May,____1988. ___________________
T. O'D. / M. F. Deputy Chairman