Labour Court Database __________________________________________________________________________________ File Number: CD8986 Case Number: LCR12345 Section / Act: S67 Parties: W. DEACON AND SONS LIMITED - and - IRISH TRANSPORT AND GENERAL WORKERS UNION |
Claim by the Union on behalf of approximately 45 workers for an improvement in the bonus scheme.
Recommendation:
6. Having carefully considered the submissions made by the
parties, the Court recommends that the latest proposals on the
production bonus be amended to provide that the bonus of #4 should
be increased to #5 for machine operatives and the #2.66 bonus for
helpers be increased to #3.25.
The Court further recommends that the proposals as amended above
should be implemented as soon as practicable and be reviewed at
the end of a year's operation should either party so wish.
Division: Mr Fitzgerald Mr Shiel Mr O'Murchu
Text of Document__________________________________________________________________
CD8986 RECOMMENDATION NO. LCR12345
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67
PARTIES: W. DEACON AND SONS LIMITED
(REPRESENTED BY THE FEDERATED UNION OF EMPLOYERS)
and
IRISH TRANSPORT AND GENERAL WORKERS UNION
SUBJECT:
1. Claim by the Union on behalf of approximately 45 workers for
an improvement in the bonus scheme.
BACKGROUND:
2. In October, 1987, the Company introduced a production bonus
scheme in order to improve production levels. The system of
payment was as follows:-
Mill Daily Production Target Helpers Machine Ops
1 1600 cu ft #4 #6
2 1700 cu ft #4 #6
3 1200 cu ft #4 #6
In early, 1988, a dispute arose over a Company decision to tax the
bonus payment which the Union alleges the Company had agreed to
pay the tax on. A number of local meetings failed to resolve the
matter and on 29th February, 1988, the Union served notice of
industrial action to commence on 8th March, 1988. The
conciliation service of the Labour Court invited the parties to
attend a conciliation conference on 3rd March, 1988. Further
conciliation conferences were held on 29th March and 7th April,
1988. A settlement was arrived at based on agreed revisions to
basic rates and the continued operation of the bonus payments in
taxable form based on the existing targets. The Union alleged
that the Company was in breach of the agreement because it was
applying the existing production targets, which had been based on
an 42.5 hour week, to a 40 hour week. (Discussions during
conciliation also took place on the question of a comprehensive
agreement which provided for a 40 hour week. The Union however
balloted on the proposals in the context of a 42.5 hour week). At
further conciliation conferences in July, 1988, agreement was
reached whereby a scaled bonus as follows was introduced which
allowed for bonus earnings at less than the production targets
previously applied:
MILL PRODUCTION PAYMENT
Machine Op. Helper
1 1500 - 1600 #4.00 #2.66
1600 - 1625 #6.00 #4.00
1625 - 1725 #6.50 #4.50
1725 - #7.50 #5.50
2 1523 - 1700 #4.00 #2.66
1700 - 1726 #6.00 #4.00
1726 - 1832 #6.50 #4.50
1832 - #7.50 #5.50
3 1125 - 1200 #4.00 #2.66
1200 - 1218 #6.00 #4.00
1218 - 1292 #6.50 #4.50
1292 - #7.50 #5.50
3. After a period of operation, the Union maintains that the
levels of earnings are unsatisfactory and in some cases less than
the earlier agreement and in all cases less than if the production
target had been adjusted to the 40 hour week. At a further
conciliation conference held on 7th December, 1988, the Company
advised that it was not prepared to make any further adjustments
to the proposals. On 10th February, 1989, the dispute was
referred to the Labour Court for investigation and recommendation.
The Court investigated the dispute on 13th March, 1989.
UNION'S ARGUMENTS:
4. 1. An increase in production targets was not mentioned at the
conciliation conference of 29th March, 1988, when the Company
first offered to raise the basic rates in exchange for
acceptance of the bonus in gross rather than net terms. The
proposals that emerged from the conciliation conference of 7th
April, 1988 did not provide for an increase in targets. An
increase in targets would have a greater than proportional
negative effect on bonus earnings given the nature of the
scheme. Consequently, it is unreasonable to suggest that a
package containing such an increase would be considered let
alone agreed to by the Union.
2. The Company has said that since a 40 hour week was being
worked at the time of the conciliation conference in April,
1988, the targets presented therefore pertained to a 40 hour
week. However, at that time the 40 hour week was in dispute.
An agreed working schedule had not been introduced and at the
Company's insistence would not be introduced until such time
as a Company/Union agreement was signed.
3. As a result of the transfer of tax liability to the
workers, the average gross loss to each worker was #15.90 per
week. To offset this loss the Company increased basic
earnings in line with the Wicklow Woods' workers' rate.
However, this increase did not apply to all the workers
concerned. Seven workers' rates were already in excess of the
Wicklow Woods' rate, and only 15 workers were to receive
increases over the 3 year period that were actually in excess
of the #15.90 loss. The total gain to the workers at the end
of the phased 3 year period is #473.02, however, the loss from
the changed bonus is #715.50 (i.e. #15.90 x 45).
4. The loss in bonus payments is considerably more than the
5.9% reduction in working time. There is in fact a reduction
of 30.39%, 38.32% and 23.68% in bonus payments in Mills 1, 2
and 3 respectively.
5. The Company is asking the workers to accomplish 42.5 hours
work in 40 hours. The Union's claim is fair and reasonable,
it is not to improve the bonus but simply to retain the bonus
that previously existed.
COMPANY'S ARGUMENTS:
5. 1. All discussions on the production bonus took place in the
context of a 40 hour week. The phased adjustment of rates of
pay and conditions of employment were only agreed to by the
Company on the basis that the then existing production
thresholds and payment levels would continue to apply in this
context.
2. The Company is not prepared to reduce the existing
production thresholds for bonus calculation.
3. The Company is satisfied that, given proper conditions,
the production thresholds are reasonable and achievable. The
maximum levels of daily production achieved in each Mill are
as follows:-
Cu Ft
Mill 1 2,000
Mill 2 2,400
Mill 3 1,600
4. The production bonus must be self financing. It must also
be consistent with good timber quality and yield levels.
5. The Company requests the Court to recommend that the
proposals which emanated from the conciliation conference in
July be accepted by the workforce.
RECOMMENDATION:
6. Having carefully considered the submissions made by the
parties, the Court recommends that the latest proposals on the
production bonus be amended to provide that the bonus of #4 should
be increased to #5 for machine operatives and the #2.66 bonus for
helpers be increased to #3.25.
The Court further recommends that the proposals as amended above
should be implemented as soon as practicable and be reviewed at
the end of a year's operation should either party so wish.
~
Signed on behalf of the Labour Court
Nicholas Fitzgerald
_________________________
Deputy Chairman
13th April, 1989
B.O'N./J.C.