Labour Court Database __________________________________________________________________________________ File Number: CD9071 Case Number: LCR12781 Section / Act: S67 Parties: BAILIEBOROUGH FOODS (NEF) - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Dispute concerning loss of earnings.
Recommendation:
5. Having considered the submissions made by the parties the
Court is satisfied that the only equitable arrangement of bonus
payment is by means of a pooling system particularly having regard
to the impact of the product throughput on the cuber operators
earnings. The Court recommends that the operators as a group
agree to this arrangement and that the Company in turn agrees to
adjust the tonnage rates in the manner suggested during the course
of the hearing so as to avoid consequential losses of earnings to
any member of the group.
Division: Mr O'Connell Mr Brennan Mr Devine
Text of Document__________________________________________________________________
CD9071 RECOMMENDATION NO. LCR12781
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67
PARTIES: BAILIEBOROUGH FOODS (NEF)
(REPRESENTED BY THE FEDERATION OF IRISH EMPLOYERS)
and
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Dispute concerning loss of earnings.
BACKGROUND:
2. The Company is involved in the manufacture of animal
foodstuffs and is located at Mullagh, Co. Cavan. Remuneration for
the workers concerned has traditionally been on the basis of piece
rates with a fall back rate which is relatively low. In January,
1987 the Company introduced a revised bonus scheme which was based
on an individual piece rate scheme as opposed to the previous
group scheme. The scheme was operated on a trial basis by the
workers concerned, but the Union claims that it was unsatisfactory
because some operators suffered a loss of earnings. The Union's
request for the re-introduction of the old scheme was rejected by
Management. Following a conciliation conference held on July,
1987 the parties agreed to have the scheme evaluated by an
industrial engineer. His report suggested that all earnings be
pooled but recommended against payment of any bonus for downtime.
This report was rejected by the Union. At a further conciliation
conference held in April, 1989 the industrial engineer was again
requested to re-examine the scheme with particular reference to
the effect on production and consequently loss of earnings as a
result of the use of new dies and a new product mix. Three of the
workers concerned expressed satisfaction with their earnings but
the report concluded that the fourth worker (a cuber operator) had
suffered a loss of earnings in the region of 12%. The report
again recommended a pooling of earnings. This was unacceptable to
the Union who claimed that compensation should be paid to the
cuber operator, a mechanism should be built in to the incentive
scheme to take account of changes in work practices and also that
the Programme for National Recovery (P.N.R.) 2nd phase increases
be applied to piece rates (it had only been applied to the
fall-back rate). The Company was prepared to consider a limited
amount of compensation to the cuber operator and adding the P.N.R.
to piece rates but rejected the inclusion of a mechanism to adjust
tonnage rates relevant to the incentive scheme. Local discussions
and further conciliation conferences held on the 6th and 19th
December, 1989 failed to resolve the matter. The dispute was
referred to the Labour Court for investigation and recommendation
on the 30th January, 1990. A Court hearing was held in Cavan on
the 7th February, 1990.
UNION'S ARGUMENTS:
3. 1. The revised bonus scheme was unilaterally introduced by
Management without consultation with the Union. While some of
the workers concerned have expressed satisfaction with their
earnings the cuber operator is suffering serious losses in his
earnings each week due to the Company's decision to change the
formula for product mix and the use of a deeper die. These
losses have been verified in the second report as being in the
order of 12% comparing earnings in 1987 to subsequent years.
It is admitted by Management that the change in formula is the
major delay in the throughput of the cuber machine.
2. As it is a machine controlled cycle the operator is
severely restricted in what he can do to speed up the
throughput. He has been forced to work considerable amounts
of overtime in an attempt to maintain his earnings at a
previous level. If the Company requires a higher quality
product and slows throughput to achieve this goal, then it
must follow that some allowance must be made for the adverse
effects on earnings. Conversely if a much faster system is
devised or a new machine purchased with superior capacity to
the existing machine then the Company would seek to reduce the
tonnage piece rate. The Union is seeking compensation
amounting to #3,000 for the cuber operator.
3. The Company's proposal to divide the earnings among the
four workers is not acceptable to the Union and would result
in having four dissatisfied members instead of one. In any
event it would not compensate for past losses. The whole
reason for the second consultants report was to identify the
cuber's loss and then expect the Company to respond reasonably
to the claim for proper compensation.
COMPANY'S ARGUMENTS:
4. 1. No loss of earnings would have arisen for the cuber
operator had the original recommendations of the independent
work study engineer been accepted. Had pooling taken place
this would have led to a 6% increase in earnings for the
worker concerned. The report of the independent engineer also
stated that the cuber's job was not appropriate to a payment
by results scheme. Against this background it is totally
unreasonable that the Company should be faced with a loss of
earnings claim where it was prevented from implementing the
pooling scheme as recommended by the independent engineer.
2. It was clearly agreed at a meeting between the parties in
July, 1987 that no further cost-increasing claims would be
submitted to the Company before 31st March, 1988. The Union's
claim for #3,000 compensation in respect of the loss of
earnings for the period from April, 1988 to date is totally
unrealistic. Full compensation for the period would amount to
less than half that figure. It must be re-emphasised that no
loss would have occurred had the earnings been pooled.
3. The Company were prepared to make a token gesture to the
worker concerned provided earnings were pooled and there were
no knock on consequences. In December, 1988 the Company made
a payment of #120.00 to all workers for no further cost
increasing claims and for their co-operation with measures to
improve efficiency.
RECOMMENDATION:
5. Having considered the submissions made by the parties the
Court is satisfied that the only equitable arrangement of bonus
payment is by means of a pooling system particularly having regard
to the impact of the product throughput on the cuber operators
earnings. The Court recommends that the operators as a group
agree to this arrangement and that the Company in turn agrees to
adjust the tonnage rates in the manner suggested during the course
of the hearing so as to avoid consequential losses of earnings to
any member of the group.
~
Signed on behalf of the Labour Court
John O'Connell
_______________________
11th April, 1990 Deputy Chairman.
T.O'D./J.C.