Labour Court Database __________________________________________________________________________________ File Number: CD88704 Case Number: LCR12212 Section / Act: S67 Parties: MID WESTERN HEALTH BOARD - and - TRANSPORT AND GENERAL WORKERS UNION |
Claim by the Union for compensation for loss of earnings.
Recommendation:
5. Having considered the submissions made by the parties and in
particular having regard to the severe financial constraints under
which the Board is obliged to operate, the Court does not
recommend concession of the Unions claim.
Division: Mr O'Connell Mr McHenry Mr O'Murchu
Text of Document__________________________________________________________________
CD88704 RECOMMENDATION NO. LCR12212
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67
PARTIES: MID WESTERN HEALTH BOARD
and
TRANSPORT AND GENERAL WORKERS UNION
SUBJECT:
1. Claim by the Union for compensation for loss of earnings.
BACKGROUND:
2. As part of an automation policy designed to reduce expenditure
the Board recently converted the heating system in Nenagh Hospital
from turf to oil. As a result three men, one boilerman and two
operatives, each lost a substantial amount of earnings per week by
way of shift premium and Saturday and Sunday premium. The Union,
on behalf of the workers sought compensation to a total of three
times the annual loss for each of the workers concerned. The
Board rejected the claim on the grounds of severe financial
difficulties, and the fact that all of the men were being retained
in employment. Agreement could not be reached on the issue at
local level, and on 12th August, 1988, the matter was referred to
the conciliation service of the Labour Court. A conciliation
conference took place on 31st August, 1988. Agreement was not
reached, and on 15th September, 1988, the matter was referred to
the Labour Court for investigation and recommendation. A Court
hearing took place in Dublin on 7th December, 1988.
UNION'S ARGUMENTS:
3. 1. In this instance management have introduced a huge cost
saving measure, and seem to expect the lowest paid workers in
the Health Board to suffer the resultant financial loss. Not
only are the Board saving the loss claimed, but because only
one boilerman is required, they also save the cost of a fourth
boilerman who was formerly required for seven months.
Additionally, temporary general staff in lieu of retired
permanent staff will not now be required because two of the
workers involved in the claim are doing general duties such as
groundsman, helping craftsmen, etc. There is therefore a
large measure of increased productivity going with the change
in the heating system. There will also be substantial ongoing
savings in fuel costs.
2. All the workers concerned are married with dependent
children, and substantial financial commitments (details
supplied to the Court). The loss of earnings would bring some
of the workers concerned below the poverty line.
3. Recognition must be accorded the workers for the manner in
which they responded to the Board's decision. They
co-operated fully with the installation of the new Boiler and
agreed to process the claim through the Court. The Board made
no offers on compensation at either direct talks or at the
conciliation conference. The men involved could have taken a
hard line and refused the new rosters until the matter was
fully processed as has been done in many cases. If they had
done this even for the last three months, the Board would have
had to employ a fourth man for the Winter period, plus paying
the members involved on the old basis since last August.
4. There are numerous precedents where the Labour court
recommended compensation for loss of earnings, some of them
where the hardship caused to the workers was not as severe as
in this case (details supplied to the Court). While the Union
acknowledges that there are financial difficulties in the
Board, it is notable that senior executives and senior
consultants are not suffering financial hardship as a result
of cutbacks. The lowest paid workers in the Board should not
be asked to carry an unfair burden, which they are unable to
contend with. In the light of the above arguments, the Union
asks the Court to recommend in its favour.
BOARD'S ARGUMENTS:
4. 1. The claim for loss of earnings cannot be sustained in view
of the Board's critical financial difficulties. In 1988 the
Board was faced with a shortfall of #3.5m in its allocation on
top of accumulated overruns of #5.2m in the previous two years
together with a current bank overdraft of #3.2m. It was
necessary therefore to implement a wide range of economy
measures (details supplied to the Court).
2. The economy measures undertaken to date have insofar as
possible been aimed at minimising the impact on services and
employment. The pay budget at Nenagh General Hospital was
overspent by #20,000 at the end of 1987, and up to 31st
October, 1988 it was again overspent by #21,000. While the
Board converted the boilerhouse to an oil fired system, the
three employees were retained in employment. This is despite
the fact that the Board did not have a need to increase its
staff complement in the grounds/maintenance area. It should
be noted that one of the former boilermen is still in receipt
of Saturday premium payments.
3. All grades of staff in the Health Board have been affected
by the cutbacks. Overtime weekend and shift working has been
reduced/discontinued in a number of areas. The Board
considers that priority in the application of its limited
resources should be given to preserving employment levels and
endeavouring to avoid further reductions.
4. The Board does not dispute that there will be a loss of
earnings for the workers, but they will now benefit from a
more socially acceptable roster. The Board has rejected the
Union's claim for compensation for loss of earnings arising
from the discontinuation of weekend premium and shift
allowance. Similar claims have been rejected by the Board in
the past and its position has been upheld by the Labour Court
(details supplied to the Court). The financial difficulties
of the organisation concerned must be a factor when
considering compensation for loss of earnings.
5. The Health Board is engaged in an extremely difficult cost
cutting exercise in an effort to remain within its allocation
for the current year. It must be emphasised that the
concession of the Union's claim can only be done at the
expense of further cutbacks in services or manpower. No other
alternative is available. Concession of the claim would
negate the Board's approach in dealing with its financial
difficulties and would give rise to an expectation of
compensation to other employees whose earnings have been
affected by economy measures. The Board is not in a position
to pay compensation for loss of earnings against the
background of its current financial position.
RECOMMENDATION:
5. Having considered the submissions made by the parties and in
particular having regard to the severe financial constraints under
which the Board is obliged to operate, the Court does not
recommend concession of the Unions claim.
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Signed on behalf of the Labour Court
John O'Connell
_________________________
13th January, 1989. Deputy Chairman
P.F./J.C.