Labour Court Database __________________________________________________________________________________ File Number: CD90585 Case Number: LCR13123 Section / Act: S67 Parties: VIRGINIA MILK PRODUCTS - and - SERVICES INDUSTRIAL PROFESSIONAL AND TECHNICAL UNION |
Dispute concerning the calculation of Holiday Pay.
Recommendation:
6. The Court having considered the oral and written submissions
of the parties does not find grounds for the union's claim that
week-end payments should be included for holiday pay in accordance
with the Holidays Act.
The Court are disposed to concede the union's contention that
there is regular and rostered overtime worked and that on this
basis there is merit in the case that this overtime should be
included for the purposes of holiday pay.
The Court however notes the claim was lodged by the union in
February 1990 and accordingly the claim is precluded under the
provisions of the Programme for National Recovery.
In the light of the above the Court recommends the parties, at the
first opportunity, arrange for the merits of the claim to be
discussed with a view to an acceptable basis being found to
resolve the issue.
Division: MrMcGrath Mr Keogh Mr Rorke
Text of Document__________________________________________________________________
CD90585 RECOMMENDATION NO. LCR13123
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67
PARTIES: VIRGINIA MILK PRODUCTS
(REPRESENTED BY THE FEDERATION OF IRISH EMPLOYERS)
AND
SERVICES INDUSTRIAL PROFESSIONAL AND TECHNICAL UNION
SUBJECT:
1. Dispute concerning the calculation of Holiday Pay.
BACKGROUND:
2. 1. The Company, which is engaged in the manufacture of fat
filled milk and a base for Baileys Irish Cream, employs 120 people
of whom approximately 80 are Union members. The Company operates
a continuous shift process and the dispute concerns approximately
35 members of the Union who are shift workers on a continuous
cycle, which entails a day off at the end of one week and at the
beginning of the next.
2. 2. The workers are paid basic plus shift premium plus a
weekend payment if Saturday and/or Sunday is worked as part of
their working week. The weekend payment is based on the
appropriate overtime rate and the Union wants it included in
holiday pay. The Company says that as it is an overtime payment
it is excluded under the Holidays (Employees) Act, 1973, and the
claim is ruled out under the terms of the Programme for National
Recovery (PNR) as it is a cost increasing claim.
2. 3. Local discussions in conjunction with the third phase of
PNR took place in April, 1990 and as the parties failed to reach
agreement on this issue it was referred to the conciliation
service of the Labour Court on 6th June, 1990. A conciliation
conference on 22nd August, 1990 failed to resolve the issue and
the matter was referred to the Labour Court for investigation and
recommendation. A Court hearing was held on 30th September, 1990.
UNION'S ARGUMENTS:
4. 1. The employees involved work on a shift system known as six
on two off which means that Saturday and/or Sunday form an
integral part of the normal weekly working hours. All hours
worked on Saturday and Sunday as part of this shift system are
paid at overtime rate as part of the shift premium in addition
to the agreed percentage of basic pay.
4. 2. The Company is not prepared to acknowledge that its
position is not in accordance with the provisions of the
Holidays (Employees) Act 1973 which stipulates that: "Normal
pay or weekly rate under Section 6(1)(3), is a sum equivalent
to the average weekly earnings (excluding pay for overtime)
for normal working hours calculated by reference to the
earnings in respect of the time worked during the 13 weeks
ending on the day before Annual leave."
3. The Company argues that this is a cost increasing claim
under PNR. However workers entitlements under the Holidays
Act supercede any National or local agreements.
4. Other companies operating a form of four shift system
which includes plus payments relating to Saturday or Sunday
working hours include such payments in annual leave payments
(details of such companies supplied to the Court).
5. The disputed payments are part and parcel of the shift
workers' normal pay and are not overtime payments as such.
Their origins were undoubtedly overtime under a different
system but are no longer in that category.
COMPANY'S ARGUMENTS:
5. 1. Adverse trading conditions make it vital for the Company
to contain costs if it is to remain competitive. Current work
practices differ considerably to those of its main competitors
and an increase in direct labour costs would further undermine
the Company's vulnerable position and leave it with work
practices which are even more antiquated than those of its
competitors.
2. Paying overtime for work performed at weekends is a long
established practice in the Company and is a follow-on from a
7 day shift cycle which was discontinued in lieu of the
current 6 day system at the request of the unions. During
negotiations at that time the Company agreed to retain
overtime payments applicable to weekends worked on the
understanding that such payments would not be included in the
calculation of holiday pay as has been the case to date. It
is relevant that it has taken the Union 4 years to lodge this
claim. The fact that this system has operated in the boiler
house since 1972, would support the Company's contention that
the Union was aware that overtime payments would not be
included in the calculation of Holiday Pay on the changeover
to the present shift systems.
3. The Company would further contend that the PNR provides
that no cost increasing claims should be imposed on employers
for the period of the programme. It would argue that the
Unions definition of overtime is contrary to Section 6(1)(3)
of the Holidays (Employees) Act, 1973 as it can be clearly
shown that overtime is not part of employees normal weekly
rate of remuneration or any regular bonus.
RECOMMENDATION:
6. The Court having considered the oral and written submissions
of the parties does not find grounds for the union's claim that
week-end payments should be included for holiday pay in accordance
with the Holidays Act.
The Court are disposed to concede the union's contention that
there is regular and rostered overtime worked and that on this
basis there is merit in the case that this overtime should be
included for the purposes of holiday pay.
The Court however notes the claim was lodged by the union in
February 1990 and accordingly the claim is precluded under the
provisions of the Programme for National Recovery.
In the light of the above the Court recommends the parties, at the
first opportunity, arrange for the merits of the claim to be
discussed with a view to an acceptable basis being found to
resolve the issue.
~
Signed on behalf of the Labour Court,
Tom McGrath
___________________
13th December, 1990.
J. F. / M. F. Deputy Chairman.