Labour Court Database __________________________________________________________________________________ File Number: CD92108 Case Number: LCR13628 Section / Act: S26(1) Parties: BAXTER HEALTHCARE S.A. - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Dispute concerning a 3% pay increase as provided for under Clause 3 of the Programme for Economic and Social Progress (P.E.S.P.).
Recommendation:
The Court has considered the submissions made by the parties
and recommends that the terms of the Industrial Relations
Officer's letter of 12th November, 1991 be modified so that the
Company's proposal to introduce payment by credit transfer is
dropped for the time being and that Clause 3 payments be amended
to provide for an adjustment of 2% with effect from 30th
September, 1991 and 1% with effect from 5th October, 1992 and that
the terms so amended be accepted by the parties as the appropriate
application of the P.E.S.P. in this Company
Division: Mr O'Connell Mr Brennan Mr Walsh
Text of Document__________________________________________________________________
CD92108 RECOMMENDATION NO. LCR13628
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES: BAXTER HEALTHCARE S.A.
and
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Dispute concerning a 3% pay increase as provided for under
Clause 3 of the Programme for Economic and Social Progress
(P.E.S.P.).
BACKGROUND:
2. The dispute concerns approximately 800 workers employed at the
Company's two plants in Castlebar and Swinford. The Union's
claim, which was submitted in June, 1991 is for full
implementation of the 3% increase provided for under Clause 3 of
the Programme for Economic and Social Progress (P.E.S.P.).
Agreement was reached at local-level discussions on a number of
issues but Management's proposal to implement the 3% increase in
two phases was rejected. Their proposal for the payment of wages
by credit transfer was also rejected by the Union. The dispute
was referred to the Labour Relations Commission on the 4th
September, 1991. A conciliation conference was held on the 7th
November, 1991. Following the conciliation conference a set of
proposals emerged which were acceptable to the Company but were
rejected by the workers concerned following a ballot of the Union
membership (Appendix A refers). The dispute was referred to the
Labour Court by the Labour Relations Commission on the 13th
February, 1992. The Court investigated the dispute in Athlone on
the 1st April, 1992.
UNION'S ARGUMENTS:
3. 1. The central issue to the Union's case is the Company's
refusal to implement the 3% increase from the beginning of
year two of the P.E.S.P. (i.e. 30th September, 1991). Clause
3 of P.E.S.P. provides for the 3% to be made in one payment.
The clause referring to "phasing-in" of the 3% only applies to
Companies in financial difficulties. Baxter Healthcare is a
very profitable Company with no financial difficulties. The
phasing-in of the 3% in two instalments is neither obligatory
nor warranted in this case. Another major employer in the
area has already implemented the 3% increase in a single
payment with effect from year two of the P.E.S.P.
2. The second major area of disagreement relates to
Management's proposal to introduce payment by credit transfer
for the workers concerned. The Union is totally opposed to
this proposal and the workers do not accept the "free
banking" concept offered by the major banks as an incentive.
There is no such thing as "free banking" as cheque book and
card charges etc., would outstrip any 3% increase. An
agreement with the Company cannot be concluded if it includes
the introduction of credit transfer.
3. The workers have made a substantial contribution to the
improved efficiency, performance and profitability of Baxter
Healthcare without any increased return from the Company. The
workers concerned are entitled to benefit from the payment of
the 3% P.E.S.P. in one phase.
COMPANY'S ARGUMENTS:
4. 1. The Company accepted the proposals of the Industrial
Relations Officer. However when these proposals were rejected
by the Union the Company withdrew its support for the package
and the current Company proposals now on offer are as detailed
in its letter of 28th August, 1991 to the Union (details
supplied to the Court).
2. The Company's rates of pay are very competitive and its
benefit package is extremely competitive in relation to other
comparable employments. The level of pay increases obtained
by the workers concerned over the past three years is
substantial and well in excess of current inflation levels.
The Company's pay and benefits package includes a service pay
structure providing for service-increments of approximately
1½% p.a. over the next three years, in addition to regular
increases provided for under the P.E.S.P..
3. Management's proposal to phase-in the 3% increase in two
payments is provided for in Clause 3 of the P.E.S.P. The
Company is paying all phases of the P.E.S.P. but is justified
in phasing-in the 3% discretionary payment in return for
operational improvements. It is essential that the Company
maintain gradual labour cost increases and keep these
increases lower than those pertaining in major markets. This
helps to maintain long-term competitiveness. The package
outlined in the Company's offer of 28th August, 1991 is a
comprehensive integrated package. It is in keeping with the
P.E.S.P. and is in the best longterm interests of the Company
and workers concerned.
RECOMMENDATION:
5. The Court has considered the submissions made by the parties
and recommends that the terms of the Industrial Relations
Officer's letter of 12th November, 1991 be modified so that the
Company's proposal to introduce payment by credit transfer is
dropped for the time being and that Clause 3 payments be amended
to provide for an adjustment of 2% with effect from 30th
September, 1991 and 1% with effect from 5th October, 1992 and that
the terms so amended be accepted by the parties as the appropriate
application of the P.E.S.P. in this Company
~
Signed on behalf of the Labour Court
John O'Connell
__________________________
14th April, 1992. Deputy Chairman
T.O'D./J.C.
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Tom O'Dea, Court Secretary.
12th November, 1991
APPENDIX A
I wish to confirm that, following the conciliation conference held
on 7th November, 1991, the Company has confirmed the following
final position, offered on the basis that it is being recommended
for acceptance by all parties.
1. No Smoking throughout the plant will mean that smoking will be
confined to a designated part of the Canteen only in both
plants, which will be the smaller portion of the Canteens.
This project will be phased in and the Company will provide
assistance for those employees who wish to resolve their
smoking problems.
2. The Company will introduce payment by Credit Transfer for all
employees effective 3rd February, 1992. Employees will be
provided thereafter with a tamper proof security type pay
envelope.
The Allied Irish Bank, Ulster Bank, and National Irish Bank
have committed to 2 years free banking for all Baxter
employees.
In any event for any Baxter employee opening an account with
the above three banks on or after 3rd February, 1992 will have
transaction free banking, indefinitely, provided they maintain
their account in credit. This facility is also available to
employees currently on Credit Transfer.
Cheque Cards, if required will cost approximately £3.00 per
year after the first 2 years and employees will be responsible
for any charges introduced through legislation.
The Company will assist in the administration process of
setting up accounts for employees with the bank of their
choice during the month of January, 1992. Finally, the
Company will provide a detailed article in the Christmas
edition of BAXTRA concerning the range of services and charges
available from a range of financial institutions in the area.
3. The waiting period for the Company's Long Term Disability Plan
will remain at 6 months.
The Union supports the fact that the long standing problem of
unauthorised time off the job must be resolved. The Company's
position also is that this issue must be resolved. Towards
this end the Company accepts the Union's suggested approach
that the issue can best be resolved by dealing with the
various issues at local departmental level. The Company plans
to commence with a programme to resolve this issue, on a
gradual basis from January, 1992.
The Company also recognises that some employees do not abuse
this particular issue and have expressed some concern at the
extent of abuse from some of their colleagues.
5. The Company will implement the medical screening programme in
the 1st half of 1992. Employees will be asked to pay a £5.00
charge if they wish to avail of this benefit.
6. A share Participation Scheme will be operational by the end of
1991 and the Company will conduct detailed explanations on the
2 share schemes during the week commencing 18th November,
1991.
7. Significantly improved changes in the Perfect Attendance
programme were announced in July, 1991.
8. Under Clause 3 of the Programme for Economic and Social
Progress the Company's final offer is to implement this in 2
phases:
- 30th September, 1991 an additional 1.5% giving a combined
increase of 4.5%. (The 3% increase is already
implemented).
- 5th October, 1992 an additional 1.5% giving a combined
increase of 5.25%.
The Company has explained in detail its rationale for this
approach, specifically:
- Good increases relative to inflation are being provided
for employees over a 3-4 year time frame.
- The Company has stated the importance of maintaining a
competitive position for the long-term. Both Company and
employees fully understand the consequences of not doing
so.
- The total package on offer is comprehensive, attractive
and in the Company's view will be appreciated by the vast
majority of employees in both plants most of whom have
short service with the Company but nevertheless have an
extremely good compensation programme relative to what is
available to other employees in the region.
Based on advice and suggestions from the Commission the
Company has revised and significantly improved its offer.
From the Company standpoint this is a final offer with all
"eight" elements being an integral part of the total offer.
This Company final offer is subject to unanimous
recommendation by the joint negotiating committees and
thereafter a joint majority acceptance by the members in both
plants. Should this total package not be acceptable then the
Company will revert to its position as outlined in its letter
of 28th August, 1991.