Labour Court Database __________________________________________________________________________________ File Number: CD90180 Case Number: LCR12808 Section / Act: S67 Parties: B & I LINE - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION;MARINE PORT AND GENERAL WORKERS UNION |
Claim for improved pensions for dockers.
Recommendation:
5. Having regard to their previous employment, and the options
made available to them when that employment ceased, the Court is
of the opinion that no obligation rests upon the employer to fund
any service prior to 1984 and does not therefore recommend
concession of the Unions claim.
Division: Mr O'Connell Mr Brennan Mr Devine
Text of Document__________________________________________________________________
CD90180 RECOMMENDATION NO. LCR12808
INDUSTRIAL RELATIONS ACTS, 1946 AND 1976
SECTION 67
PARTIES: B & I LINE
and
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
MARINE PORT AND GENERAL WORKERS UNION
SUBJECT:
1. Claim for improved pensions for dockers.
BACKGROUND:
2. The claim concerns 18 dockers who were taken into permanent
employment by the Company in 1984. They have long service working
on the docks in a casual capacity under the Dublin Cross Channel
Shipping Association. For pension purposes however the workers
concerned are being credited with their service in the Company
from 1984. On this basis they will retire with very small
pensions and lump sums. Prior to 1984 they had been employed in a
permanent capacity by two other companies, Bristol Seaway and
Buitelaar and had been contributing to pension schemes. Both
these companies closed in 1980 and 1983 respectively. When the
workers transferred to the B & I Line in 1984 they did not seek
the transfer of their pension entitlements, nor was provision made
for the purchase of back service funding. The Company states that
under the terms of an agreement (under the Murphy Report
negotiations) reached in 1974 each individual company in the
Dublin Cross Channel Shipping Association would take
responsibility for their own dockers including the provision of
pension arrangements and back funding and it was not the
responsibility of B & I. The Union claims that, in view of the
workers very long service on the docks, they should receive a
"Murphy Report" type pension (details supplied to the Court) which
would amount to a pension of #10 per week and a lump sum of
#7,500. This pension had been offered to other dockers in the
intervening years by the Dublin Cross Channel Shipping
Association. The Murphy Report was commissioned against a
background of Dublin Port losing traffic on its cross channel
services and a rationalisation of the dock workforce. The Company
has rejected the claim on the grounds that the cost of the claim
is prohibitive and that "Murphy Report" pensions are no longer on
offer. The Company states that in 1978 when due to expansion it
canvassed other companies, including Bristol Seaways and
Buitelaar, to recruit dockers it was only able to recruit six.
These joined the Company on very favourable terms including back
service funding. The workers concerned did not avail of the
offer. The Unions contend that they did not do so because they
feared that they would again be employed on a casual basis in B &
I and they already had permanent positions in Bristol Seaway and
Buitelaar. They were not to know these companies would close so
quickly. The Unions maintain that the Company has an obligation
to the worker concerned to provide them with reasonable pensions.
Local discussions and two conciliation conferences held on the 9th
June, 1989 and 16th February, 1990 failed to resolve the issue
which was referred to the Labour Court on the 19th February, 1990.
A Court hearing was held on the 23rd February, 1990.
UNIONS' ARGUMENTS:
3. 1. Under the Murphy Report provision was made for a pension
to be paid to dockers until individual company schemes were
introduced. Since then the majority of dockers in B & I have
been fortunate enough to be in membership of the Company
scheme for periods which will ensure reasonable pensions. The
workers concerned who were employed by Bristol Seaways and
Buitelaar have been unfortunate in that both companies closed
before reasonable pension entitlements had accrued. Since
they are members of the B & I scheme only since August, 1984,
and with the age profile of those involved, the pensions they
will receive at retirement will be negligible. For example
one of the workers concerned who retired in March, 1989
received a lump sum of #1,600 plus a small weekly pension
after 44 years service on the docks employed by companies in
the Cross Channel Shipping Association.
2. The Union has pointed out to the Company in recent
discussions that provision could be made (by the Company) for
an additional pension similar to the Murphy Report pension.
Such an arrangement had been agreed by the Company during
negotiations on rationalisation in 1987 and former Bristol and
Buitelaar dockers had opted out with Murphy Report pensions of
#7,500 plus #10 per week, in addition to their entitlement
under the Company pension scheme. Therefore, there was no
reason why a similar arrangement could not be agreed to cover
their colleagues who had remained. Dockers who are employed
by Sealink at Dublin Terminal did not join the pension scheme
for Sealink workers, but they receive a Murphy Report pension,
funded by Sealink on retirement. This is currently #10,000 or
#5,000 and #20 per week.
3. There is an established precedent for Murphy Report
pensions being paid by companies within the Cross Channel
Shipping Association and such an arrangement could be made to
accommodate the workers involved in this claim. The Company
has referred to the possibility of consequential claims by
catering and marine sections, but the situation with the
dockers is totally different. They have continuous service on
the docks and not casual service as with other sections. The
Unions feel very strongly that the Company could meet this
claim and ensure a reasonable pension package at retirement to
ensure that those involved will have something decent if not
altogether adequate to show for their lengthy years of service
on the docks. It should be noted that whilst the Company did
not concede the claim during the early part of 1989 they did
indicate as far as the Union is concerned a willingness to
address the matter after 1st July, 1989. They have now
totally reneged on the commitment, and this is unacceptable to
the Union.
COMPANY'S ARGUMENTS:
4. 1. Prior to July, 1984 the workers concerned were never on
the Company's permanent staff or payroll. The cost of
providing the past service as claimed would be substantial.
Since July, 1984 the workers concerned have been paying
superannuation contributions to the Company's general pension
fund and will at normal retirement age benefit from this fund
in accordance with their years of service and contributions
paid. In November, 1987 under a voluntary severance early
retirement scheme the Company put forward special terms for
former Bristol and Buitelaar dockers who had commenced
permanent employment on the 16th July, 1984 as follows:-
(i) Dockers over 60 years on 31st December, 1987
Company early retirement pension terms and statutory
redundancy lump sum plus #10 per week under Murphy
Scheme.
(ii) Dockers of 50 years and under 60 years on 31st
December, 1987
The Company pension entitlement plus #10 per week
(Murphy Scheme) and the combined Company lump sum and
statutory lump sum with a minimum #7,500 (Murphy
Scheme).
(iii) Dockers under 50 years on 31st December, 1987
The combined Company lump sum and statutory lump sum
subject to a minimum of #7,500 (Murphy Scheme) plus
#10 per week under Murphy Scheme.
These terms were open to all the workers concerned but only 2
over age 60 availed of the above terms and retired in early
1988 receiving appropriate benefits. The terms were available
to all of the claimants; however, they exercised their option
to continue in employment as was their right.
2. The benefits accruing from a pension scheme are directly
related to the number of service years and contributions made
and this is a basic principle of all pension schemes. It
should be noted that on the winding up of both Buitelaar and
Bristol Seaways the claimants had options as previously
outlined. It was in addition of course open to them at the
time to re-invest severance payments including the state
statutory redundancy in either the B & I Pension Fund (there
is provision to purchase additional years) or in some other
investment fund. In the event only one of the claimants is
availing of the additional voluntary contribution arrangement
in the fund to buy extra pensionable service.
3. It is most unreasonable to expect the Company to fund
additional years for the claimants. In 1974 under the Murphy
Report the Company met its obligations in full regarding the
dockers taken into permanent employment at that time.
Responsibility for the claimants rested with the companies to
which they were permanently attached, and the claimants had
the option of taking benefit from the pension arrangements
made by their former employers. The Company must deal with
all employees in an equitable and consistent manner, and in
this regard many workers fund back service for pension
purposes at their own expense. A recent case also highlights
the Company's consistency in dealing with pension matters. It
relates to a docker who joined the Company's permanent
workforce in 1973, but opted in 1975 not to join the pension
fund as was his right. He maintained through his union that
he was entitled to the Murphy Report pension (#10 p.w. plus
7,500 lump sum) on his retirement. This was strenuously
rejected by the Company in 1977 and the worker subsequently
joined the Pension Fund in 1984. He subsequently resigned
under the voluntary severance scheme in 1988. His settlement
was based solely on his pensionable service from 1984.
4. The cost of conceding this claim in full has been
calculated at circa #640,000. This is the actuarial cost of
funding a notional 20 years pensionable service in the General
Pension Fund by means of a capital payment by the Company as
at the 28th February, 1990. The successful negotiation of a
Company/Union agreement on pay in 1989 was crucial to the
continued viability of the Company by providing stability in
payroll costs over the next few years. The Company has many
problems, is still losing money, and is dependent on
Government support. The claim if conceded would worsen the
financial position and would have repercussive effects.
RECOMMENDATION:
5. Having regard to their previous employment, and the options
made available to them when that employment ceased, the Court is
of the opinion that no obligation rests upon the employer to fund
any service prior to 1984 and does not therefore recommend
concession of the Unions claim.
~
Signed on behalf of the Labour Court
John O'Connell
___________________________
26th April, 1990. Deputy Chairman
T.O'D./J.C.