Labour Court Database __________________________________________________________________________________ File Number: CD90250 Case Number: LCR12969 Section / Act: S67 Parties: MELCHERT ELECTRONICS LISTOWEL - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Claim concerning salary scales/ranges for the Company's clerical and administrative staff.
Recommendation:
6. The Court after careful consideration of the submissions and
arguments put forward by the parties, is of the view that the
aspirations of the claimants for the introduction of conventional
salary scales is currently in conflict with the Company's
requirement for a reasonable period of stability in labour costs.
The Court notes that both parties have discussed the range of
salary levels which should apply to the different jobs, that the
more serious pay anomalies have been addressed and stage 1 and 2
of the PNR have been paid.
It was clear to the Court at the hearing that both parties had
totally conflicting interpretation of each others position in
relation to annual increments. The Court recommends that salary
scales be introduced. It follows therefore, that further
discussions must take place. To give a focus to the talks the
Court recommends that the parties each draw up a list of Companies
they consider would best reflect the pay incremental structure
appropriate to this claim. On the basis of the evidence they
shall endeavour to conclude negotiations. If necessary the Court
will provide an I.R.O. to assist the parties.
The Court expect that negotiations would be finalised before the
end of the year.
Division: Ms Owens Mr Keogh Mr O'Murchu
Text of Document__________________________________________________________________
CD90250 RECOMMENDATION NO. LCR12969
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67
PARTIES: MELCHERT ELECTRONICS LISTOWEL
(REPRESENTED BY THE FEDERATION OF IRISH EMPLOYERS)
AND
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Claim concerning salary scales/ranges for the Company's
clerical and administrative staff.
BACKGROUND:
2. The Company manufacture printed circuit boards. It is owned
by the Krupp Atlas Group. There are approximately 170 workers
employed in its Listowel plant. Arising from discussions relating
to laboratory personnel, Company management and the Union agreed
to introduce a salary system whereby all workers would receive the
market rate of pay. Following local discussions and a job
evaluation exercise, the Company proposed a five grade structure
in November/December, 1989. The proposals included salary
minima and maxima. Further local discussions took place and
agreement was reached on the five grade structure, job
descriptions and salary minima and maxima. On 31st January 1990,
management confirmed their proposals as:-
A) Salary increases proposed for 1st June, 1990 would include
the 2nd phase of the PNR.
B) Merit increases for the future would be 0-4%.
C) Minima and maxima of salaries appropriate to the five grades
would not alter with 2nd or 3rd phase of the PNR.
D) Workers on the maximum of their scales in June, 1991, would
receive the PNR payment.
The proposals were accepted by the Union subject to the proposed
salary scales/ranges being adjusted by phase 2 and 3 of the PNR,
the size of merit increase and the duration of the scales/ranges
being resolved. As no agreement was reached the issues were
referred to the conciliation service of the Labour Court and were
the subject of a conciliation conference on 3rd April, 1990. No
agreement was reached as management, were adamant that salary
minima and maxima would not be increased until discussions took
place in May 1992, and that merit payments which would be 0-4%,
would only apply for above average performance. The Union
requested a full Court hearing and the Company agreed. The Court
investigated the dispute in Tralee on 25th July, 1990.
UNION'S ARGUMENTS:
3. 1. Management are attempting to roll back on salary increases
offered, in trying to offset the effect of two phases of the
PNR. They must realise that the salary rates as they stand
are no more than adequate, particularly in the context of a 39
hour week. The effect of not applying phase 2 and 3 of the
PNR would amount to a 5% reduction in the rates of pay as
proposed. This is totally unacceptable to the workforce who
are seeking the application of phase 2 and 3 of the PNR on 1st
June, 1990 and on 1st June, 1991 respectively, to all salary
rates as proposed. Two grade 4 workers who are within 2.50% of
their maximum would loose out if it were accepted that the
Company's offer absorbed phases 2 and 3 of the PNR.
2. Management are adamant that no merit will accrue from a
normal performance. They argue that conceding the merit claim
amounts to the payment of increments. Whether a worker
achieves a merit award or an increment is irrelevant. They
are both intended as a reflection of performance and
accordingly, a natural progression towards the maximum of the
scale. The existence of a scale implies that ultimately the
maximum of the scale is achieved by satisfactory performance,
and more quickly by exceptional performance. Employers
generally, do not claim that a normal performance will not
qualify a worker to advance along the scale - to do so would
be to imply that attaining the maximum would be the exception
rather than the rule. Even where increments are perceived as
being automatic, there is a requirement to attain a
satisfactory level of performance. Most workers are average
and can therefore only reasonably be expected to achieve a
normal performance.
4. 3. The duration of the scales as per the Company offer is
7-10 years. The size of merit i.e. 0-4% and the duration of
the scales are inter-twined. The 0-4% merit implies an
average 2% merit payment. If a 2% merit was applied to the
mid point on each scale, their duration would vary from 18-23
years. This scenario reduces the scales/merit package to a
farce. The Court is asked to recommend a scale duration of
7-10 years, as per the Company offer and that the average
merit be adjusted accordingly.
COMPANY'S ARGUMENTS:
4. 1. The Company at no time agreed to introduce incremental pay
scales. Instead it proposed payment ranges for each job
category, with annual adjustments to take account of cost of
living increases/PNR type of adjustments. Further adjustments
would be possible under the heading of 'merit'. Workers who
performed above average would receive an additional percentage
increase by way of a merit payment. Merit payments would only
operate for workers whose performance was consistently above
average. There would be no average merit payment for average
performance.
2. Trading circumstances are a determining factor as to
whether or not the Company can meet the claim put forward by
the Union. The Company's position is that it can look forward
with confidence to honouring its commitment as it has set it
out. The proposals which are on offer are fair and reasonable
in the Company's present financial situation. The Company has
made very substantial additional payments and adjustments to
each and every staff member since the commencement of
discussions. The payments have been made in an effort to
address anomalies which existed. The Union has acknowledged
the efforts made by the Company and recognises that in some
cases increases of up to 31% have been paid to workers.
3. The Company's position is underscored by the extensive
research and survey undertaken on its behalf by Industrial
Relations Information and Advisory Services. Company
management have made every effort to investigate the market
rate for the various grades, groups and categories which it
employs. Management must make a keen judgement between the
need to properly reward and maintain workers and the trading
circumstances of the business. Accordingly, the Court is
asked to endorse the Company position and to recommend that
the Company's proposals for pay increases and salary levels
are fair and reasonable in the circumstances.
RECOMMENDATION:
6. The Court after careful consideration of the submissions and
arguments put forward by the parties, is of the view that the
aspirations of the claimants for the introduction of conventional
salary scales is currently in conflict with the Company's
requirement for a reasonable period of stability in labour costs.
The Court notes that both parties have discussed the range of
salary levels which should apply to the different jobs, that the
more serious pay anomalies have been addressed and stage 1 and 2
of the PNR have been paid.
It was clear to the Court at the hearing that both parties had
totally conflicting interpretation of each others position in
relation to annual increments. The Court recommends that salary
scales be introduced. It follows therefore, that further
discussions must take place. To give a focus to the talks the
Court recommends that the parties each draw up a list of Companies
they consider would best reflect the pay incremental structure
appropriate to this claim. On the basis of the evidence they
shall endeavour to conclude negotiations. If necessary the Court
will provide an I.R.O. to assist the parties.
The Court expect that negotiations would be finalised before the
end of the year.
~
Signed on behalf of the Labour Court,
Evelyn Owens
___7th___August,___1990. ___________________
A. McG. / M. F. Deputy Chairman