Labour Court Database __________________________________________________________________________________ File Number: CD92451 Case Number: LCR13824 Section / Act: S26(1) Parties: FIRST NATIONAL BUILDING SOCIETY - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Dispute concerning: (1) Branch responsibility allowance. (2) Bonus incentive.
Recommendation:
8. The Court has fully considered the views expressed by the
parties in their oral and written submissions and finds as
follows:
1. Responsibility Allowances
It is the view of the Court that the responsibility allowance
offered by the Company at its current day value should be paid
to the Supervisors/Senior Cashiers in accordance with the
criteria proposed by Management.
2. Bonus Payment
While the Court recognises that the Society's Head Office
Operation is fundamentally different from its Branch
operation, and that the system of bonus payments operated in
the Branches would not be a suitable basis on which to base
rewards for Head Office staff it considers it is incumbent on
the Society to have regard to the interests of all categories
of staff. Accordingly it is the view of the Court that the
Society should make such arrangements as are necessary to put
in place an appropriate system of compensation for outstanding
performance by Head Office staff, and give an assurance that
such system will be maintained as long as the present bonus
system as applies in the Branches is in operation.
The Court so recommends.
Division: MrMcGrath Mr Brennan Mr Rorke
Text of Document__________________________________________________________________
CD92451 RECOMMENDATION NO. LCR13824
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES: FIRST NATIONAL BUILDING SOCIETY
(REPRESENTED BY THE FEDERATION OF IRISH EMPLOYERS)
and
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Dispute concerning:
(1) Branch responsibility allowance.
(2) Bonus incentive.
GENERAL BACKGROUND:
2. The claims were referred to the Labour Relations Commission in
July, 1991. Conciliation conferences were held on the 8th July,
1991, 3rd April and 18th May, 1992 but no agreement was reached.
The dispute was referred to the Labour Court by the Labour
Relations Commission on the 23rd July, 1992. A Court hearing was
held on the 14th September, 1992.
Claim 1. Branch Responsibility Allowance
Background
3. In May, 1989 the Society proposed to introduce a
responsibility allowance of #50 per week to Branch
Supervisors/Senior Cashiers for providing cover for Branch
Managers on leave for periods of one week (5 working days) or
more. The Union claimed that the allowance should be calculated
on a daily rather than a weekly basis to cover leave periods of
less than 5 days. In March 1990, the parties concluded an
agreement on technology/services. At subsequent discussions the
Union claimed that the allowance should be increased. Management
reiterated its offer of 1989. This was unacceptable to the Union.
UNION'S ARGUMENTS:
4. 1. The nature of the Society's business has changed
significantly and branch managers are now expected to become
more involved in business developments. There is an
increasing incidence of Branch Supervisors/Senior Cashiers
being expected to act in the absence of Managers. The Union
is not seeking payment for days when the Manager visits
the office either morning or afternoon but only for annual and
sick leave of one day's duration.
2. The Company's offer must be increased to take account of
changing developments since 1989. The Union also seeks the
facility to accumulate single days if the administration of
single day allowance proves problematic.
SOCIETY'S ARGUMENTS:
5. 1. In March 1990, the parties concluded an agreement on
technology/services and throughout extensive negotiations no
mention was made of this allowance nor was it listed as an
outstanding item. When the Union again raised the issue, in
1990 Management reiterated its offer of 1989. The significant
change in the role of branch staff and managers was recognised
by the payment of a 12% increase in salaries. The Company is
still prepared to honour its original offer. Management
rejects the claim for payment on a daily basis. As an
alternative to paying the allowance on a weekly basis the
Society is prepared to make an annual payment of #150 to the
workers concerned.
Claim 2. Bonus Incentive - Head Office
Background:
6. In 1990, the Society introduced an incentive bonus scheme
based on sales performance in the branch offices. The scheme
related specifically to branch offices. In that year a similar
scheme, based on performance appraisal, was applied to Head office
staff. This scheme was withdrawn at Head office as it proved
difficult to implement. In 1992, the Branch office scheme was
enhanced and the Society introduced a staff development budget
scheme in Head office whereby each head office manager received a
sum of #160 per staff member to be spent on staff who performed
exceptionally. The money was not paid directly to staff. The
Union claims that there is an inequitable distribution of payments
to Head office staff compared to payments to Branch office staff
and is seeking the reinstatement of the bonus scheme of 1990 or
alternatively the reintroduction of a "merit increment" if the
former proves difficult to reinstate.
UNION'S ARGUMENTS:
7. 1. In 1992, the bonus scheme for branches was enhanced while
Head office staff were advised of the discontinuance of bonus
payments. This is grossly unfair to Head office workers who
are left without a bonus or merit-increment scheme while their
workload has increased significantly. Prior to the
introduction of the scheme a "merit based incremental system'
existed to reward exceptional performance. This was
discontinued on the introduction of the bonus scheme. The
Head office staff are now left without a bonus or
merit-increment scheme due to the unwillingness or inability
of Management to devise a new formula for Head Office.
SOCIETY'S ARGUMENTS:
8. 1. The branch sales incentive bonus is related to
predetermined targets and is instrumental in generating new
business for the Society. These schemes relate solely to the
branch network who deal directly with the Society's customers.
Approximately 50% of branch staff receive this payment.
2. Head office provides the administrative back-up to the
branches but staff roles at Head office are completely
different as they are not primarily concerned with directly
developing new business. The work of Head office staff cannot
be quantified in terms of targets achieved in the same way as
in the branches.
3. The staff development budget is the most appropriate
method of motivating and recognising exceptional performance
in Head office.
4. Both schemes are introduced on a year to year basis and
there is no commitment or guarantee that they will continue.
No other Building Society operates incentive payment schemes
for their Head office staff.
RECOMMENDATION:
8. The Court has fully considered the views expressed by the
parties in their oral and written submissions and finds as
follows:
1. Responsibility Allowances
It is the view of the Court that the responsibility allowance
offered by the Company at its current day value should be paid
to the Supervisors/Senior Cashiers in accordance with the
criteria proposed by Management.
2. Bonus Payment
While the Court recognises that the Society's Head Office
Operation is fundamentally different from its Branch
operation, and that the system of bonus payments operated in
the Branches would not be a suitable basis on which to base
rewards for Head Office staff it considers it is incumbent on
the Society to have regard to the interests of all categories
of staff. Accordingly it is the view of the Court that the
Society should make such arrangements as are necessary to put
in place an appropriate system of compensation for outstanding
performance by Head Office staff, and give an assurance that
such system will be maintained as long as the present bonus
system as applies in the Branches is in operation.
The Court so recommends.
~
Signed on behalf of the Labour Court
Tom McGrath
_____________________
30th October, 1992. Deputy Chairman
T.O'D./J.C.
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Tom O'Dea, Court Secretary.