Labour Court Database __________________________________________________________________________________ File Number: CD89736 Case Number: LCR12658 Section / Act: S67 Parties: NESTLE (IRELAND) LIMITED - and - IRISH TRANSPORT AND GENERAL WORKERS' UNION;FEDERATED WORKERS' UNION OF IRELAND |
Short-time working/early retirement.
Recommendation:
5. The Court, on the basis of the information available to it is
of the opinion that the stock-piling problem as now existing
should be treated as an issue in isolation from the overall survey
now in progress. In this context, the Court considers that the
Company's proposal in relation to lay-off should be accepted.
However, the introduction of the necessary short-time working
(week on week off or other as appropriate) should be deferred
until 2nd January, 1990.
The Court so recommends.
Division: Ms Owens Mr McHenry Mr Walsh
Text of Document__________________________________________________________________
CD89736 RECOMMENDATION NO. LCR12658
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67
PARTIES: NESTLE (IRELAND) LIMITED
and
IRISH TRANSPORT AND GENERAL WORKERS' UNION
FEDERATED WORKERS' UNION OF IRELAND
SUBJECT:
1. Short-time working/early retirement.
BACKGROUND:
2. The Company is producing a greater volume of product than
customers require. This situation is causing a large build up of
stocks. Management maintains that production output must be
reduced and in order to achieve this reduction the Company
proposes to place 20 workers on in definite short-time working or
alternatively 10 workers are required to take early retirement.
The Unions have rejected the proposals on the grounds that a major
work study is presently being undertaken at the plant and
therefore no action should be taken by Management until the
results are known. Local discussions failed to resolve the issue
and the dispute was referred to the conciliation service of the
Labour Court on the 16th October, 1989. A conciliation conference
was held on the 20th October, 1989 but no agreement was reached.
The dispute was referred to the Labour Court for investigation and
recommendation on the 23rd October, 1989. A Court hearing was
held on the 17th November, 1989.
UNION'S ARGUMENTS:
3. 1. In February, 1989 the Unions agreed to a Company proposal
to reduce the workforce by 7 workers. This was achieved on a
voluntary basis and while the Unions were not entirely
convinced of the Company's decision to reduce staff levels,
nevertheless they agreed to the reduction. Subsequently the
Company indicated that they wished to initiate an
investigation work study of all operations in the production
area on the grounds that changes needed to be made. The
Unions agreed to the terms of reference for this study which
is currently taking place.
2. Within a matter of weeks after the commencement of the
work-study the Company indicated its wish to introduce
short-time working or redundancies. The Unions cannot accept
that the Company now needs to implement a short-time working
voluntary redundancy scheme, when they previously stated that
both the level of sales and manning levels as set out earlier
in the year, were on course. It is the Unions' view that the
investigation work/study currently being undertaken is well
advanced and that most of the areas have been completed. The
Unions cannot accept a piecemeal operation being implemented
without an overall view of its implications. Effectively
negotiations on the plant would be pre-empted by the Company's
current action.
3. The Company has stated that stocks are at an unacceptable
level. The figures available to the Unions as from October
indicate a 50% reduction in stock levels since March, 1988.
The stock levels in 1988/1989 have been on a consistently
downward trend, and management has not contested this fact.
The Unions feel that the Company has switched production in
such a way as to lead to stockpiling thereby strengthening its
case for the introduction of short-time/staff reductions.
COMPANY'S ARGUMENTS:
4. 1. The present over production is not a tenable situation and
if allowed to continue will present even greater difficulties,
and will adversely affect even more people, if the issue is
not addressed now. In April, 1989, with Union agreement,
manning levels were reduced by 7 workers availing of early
retirement. In June, for 5 weeks, the Company allocated each
day, approximately 20 people to non productive working. This
non productive work cannot be ongoing as it generates costs
but no added value. These costs cannot be passed on to
consumers as they will not accept such costs.
2. The problem of over production must be resolved now and
the solution would be to reduce production equivalent to 10
full-time workers. It can be achieved by placing 20 on
short-time working, or early retirement for 10 workers. The
Company feels that there would be no problem finding 10
workers to avail of early retirement.
3. The Company must move now to address the issue.
Profitability is low, the rate of return on turnover is much
too low and costs must be reduced - this is already being
addressed with the co-operation of the workforce. The Unions
insist that no action is taken until the work study is
completed. They also insist that the result of this study
will not be discussed until all areas are completed which
includes direct production, services, clerical and sales
representatives. If the Company waits until this time,
estimated to be March or April, 1990, the stock position will
have risen to a critical level and will then only be resolved
by causing hurt to many people.
RECOMMENDATION:
5. The Court, on the basis of the information available to it is
of the opinion that the stock-piling problem as now existing
should be treated as an issue in isolation from the overall survey
now in progress. In this context, the Court considers that the
Company's proposal in relation to lay-off should be accepted.
However, the introduction of the necessary short-time working
(week on week off or other as appropriate) should be deferred
until 2nd January, 1990.
The Court so recommends.
~
Signed on behalf of the Labour Court
Evelyn Owens
________________________
28th November, 1989 Deputy Chairman
T.O'D./J.C.