Labour Court Database __________________________________________________________________________________ File Number: CD92461 Case Number: LCR13797 Section / Act: S26(1) Parties: SMURFIT CORRUGATED CASES LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
A dispute concerning the reintroduction of a bonus scheme.
Recommendation:
5. Having considered the submissions made by the parties the
Court is satisfied that the suspension of the waste bonus scheme
in 1989 in no way implied the restoration of the same scheme when
the installation of the new equipment was complete. The Court
therefore does not recommend concession of the Union's claim for
retrospective payment of the bonus terms. On the other hand the
Company appear to have been dilatory in their efforts to negotiate
and introduce a replacement bonus appropriate to the operation of
the new equipment.
The Court in the circumstances recommends that the Company pay
each worker involved a sum of #100 and proceed without delay to
negotiate the terms of an amended waste bonus.
Division: Mr O'Connell Mr McHenry Mr Walsh
Text of Document__________________________________________________________________
CD92461 RECOMMENDATION NO. LCR13797
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES: SMURFIT CORRUGATED CASES LIMITED
(REPRESENTED BY THE FEDERATION OF IRISH EMPLOYERS)
and
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. A dispute concerning the reintroduction of a bonus scheme.
BACKGROUND:
2. 1. The Company manufactures corrugated cases and employs 180
workers. There are 120 workers involved in the claim for a
bonus scheme. A waste bonus scheme was introduced in 1984
based on payment when waste was reduced to specified levels
(details supplied).
2. In December, 1989, a payment of #360 per worker was made
and the scheme was suspended. The agreement of the Union was
secured on the basis that the Company would review the
position in the light of experience with new machinery and
come forward with proposals for a new more appropriate bonus
arrangement. New machinery which was in the planning stage at
that time was commissioned in April, 1991.
3. The Union requested the Company on a number of occasions
to re-introduce the bonus scheme. A meeting took place
between the parties on 2nd October, 1991 to discuss the issue.
It was not possible for the parties to agree on a Union claim
for payments due under the old scheme or the introduction of a
new scheme. The dispute was referred to the Labour Relations
Commission. A conciliation conference was held on 15th July,
1992.
4. The Union stated at conciliation that the Company had not
honoured its commitment of 1989 to introduce a new scheme
within a reasonable period of time. The Company claimed that
it was not yet in a position to propose a revised scheme as
the new machinery had not produced the expected results in
terms of waste reduction. It refused to consider the Union's
claim for #660 per man under the old scheme.
5. No progress was possible and the claim was referred to the
Labour Court on 6th August, 1992 in accordance with Section
26(1) of the Industrial Relations Act, 1990. Prior to the
Labour Court investigation, the Company presented the Union
with a revised scheme backdated to 1st January, 1992. The
Union refused to negotiate on a new scheme until its claim of
#660 per man due under the terms of the old scheme was
addressed. A Labour Court investigation took place on 28th
September, 1992.
UNION'S ARGUMENTS:
3. 1. There is a specific agreement in place on waste bonus
which was freely entered into by both sides and which must be
honoured by the Company. The Union agreed to a suspension of
the agreement in 1989 on the understanding that the Company
would shortly propose terms for a new scheme. Despite
repeated requests to the Company no proposals emerged until
immediately prior to the Labour Court investigation. In these
circumstances the workers are entitled to the accumulated
bonus payments earned since the suspension of the scheme.
2. The Company's new proposals for the bonus scheme were
balloted on by the workers on 18th September. The Company was
informed that the Union would not negotiate on a new scheme
until monies owed to the workers under the terms of the old
scheme were paid. In 1989, the workers accepted the validly
of the proposed installation of new equipment and its effect
on the old scheme. In this context a short term suspension
was agreed. Up to very recently the Company which is a highly
profitable one has made no attempt to honour its side of the
agreement.
COMPANY'S ARGUMENTS:
4. 1. The Company has invested #4.07m in a refurbishing
programme at the plant. In terms of waste reduction it is
only since January, 1992 that the new equipment is operating
to a level which accurately reflects the validity of a new
bonus scheme. Prior to this date it was impossible for the
Company to accurately cost waste. The extended waste
reduction which should emanate from such a capital outlay had
not been achieved by the Company.
2. The payment of #360 per worker in 1989 was made on the
clear understanding and acceptance by the Union that the bonus
scheme as it was then constituted be suspended. The Union has
acknowledged that the waste perometers of the old bonus scheme
were too loose. In this context, the Company received no
claim for payment from the Union up to the conciliation
conference. The Company has proposed a new scheme to the
Union and has offered to backdate the benefits to 1st January,
1992.
RECOMMENDATION:
5. Having considered the submissions made by the parties the
Court is satisfied that the suspension of the waste bonus scheme
in 1989 in no way implied the restoration of the same scheme when
the installation of the new equipment was complete. The Court
therefore does not recommend concession of the Union's claim for
retrospective payment of the bonus terms. On the other hand the
Company appear to have been dilatory in their efforts to negotiate
and introduce a replacement bonus appropriate to the operation of
the new equipment.
The Court in the circumstances recommends that the Company pay
each worker involved a sum of #100 and proceed without delay to
negotiate the terms of an amended waste bonus.
~
Signed on behalf of the Labour Court
John O'Connell
____________________
21st October, 1992. Deputy Chairman
J.F./J.C.
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Jerome Forde, Court Secretary.