Labour Court Database __________________________________________________________________________________ File Number: CD92155 Case Number: LCR13684 Section / Act: S26(1) Parties: IRISH SHELL LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Claim by the Union for the extension of an executive loan scheme to all grades (i) an increase in the private mileage rate payable to staff and (ii) an alteration in the operative date of the Programme for Economic and Social Progress (P.E.S.P.).
Recommendation:
3. The Court considered the submissions made by the parties on
the issues before it and recommends as follows:
1. Staff Loan
The Court does not recommend that the Company extend the
terms of the discretionary loan system as requested.
2. Private mileage rate
The Court is of the opinion that the rate offered by the
Company is reasonable and should be accepted by those
concerned.
3. Operative date of P.E.S.P.
The Court, whilst accepting that the agreements which
currently operate were entirely voluntary, does not
consider that it was intended that their operation would
result in the time lag in pay adjustments that now
exists.
On the other hand it does not feel that it is open to it
to adjust the time scale of P.E.S.P.
In the circumstances the Court recommends that the parties agree
to negotiate arrangements whereby, after the terms of P.E.S.P.
have ended, the pay adjustments may be brought more into line with
other firms in the industry.
Division: Mr O'Connell Mr Collins Mr Walsh
Text of Document__________________________________________________________________
CD92155 RECOMMENDATION NO. LCR13684
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES: IRISH SHELL LIMITED
(REPRESENTED BY THE FEDERATION OF IRISH EMPLOYERS)
and
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Claim by the Union for the extension of an executive loan
scheme to all grades (i) an increase in the private mileage rate
payable to staff and (ii) an alteration in the operative date of
the Programme for Economic and Social Progress (P.E.S.P.).
BACKGROUND:
2. There is currently a loan scheme in operation within the
Company whereby it is possible for certain staff members to
receive low interest loans where repayment of capital is deferred
until either the date of retirement or of termination of
employment. Initially the scheme applied only to senior
executives but over the years it has been extended down to some
members of other grades i.e. grade 5+6. The Union claims that the
Company is being selective in its application of the scheme and
feels that it should be extended to all members of those grades.
Workers who use their cars to carry out Company business receive a
mileage allowance of 50p per mile. This has recently been
increased from 40p a mile. The Union claims that this should be
brought into line with Public Service rates.
Prior to the implementation of the Programme for National Recovery
(P.N.R.) an agreement was entered into by the parties which had
the effect of deferring the implementation date of the P.N.R. As
a result of this agreement the workers benefited from a higher
increase than their counterparts in the rest of the industry.
Most workers employed in the industry benefited from the terms of
the P.E.S.P. from 1st January, 1991 but the workers concerned did
not benefit until 1st January, 1992 because of that agreement.
The Union are seeking a method of implementing the P.E.S.P. so
that it will expire in December, 1993, the same as in the rest of
the industry.
The Company rejected the Union's claims and the issues were
referred to the conciliation service of the Labour Relations
Commission on 16th October, 1991. A conciliation conference was
held on 5th February, 1992 at which agreement was not reached.
The issues were referred to the Labour Court on 12th March, 1992
under Section 26(1) of the Industrial Relations Act, 1990. The
Court investigated the dispute on 30th April, 1992.
UNION'S ARGUMENTS:
3. 1. Loan Scheme
The Company in its application of the executive loan scheme
is being selective in not extending to all members of Group 5
and 6. It is clearly discriminating against some employees
as there is no valid reason/argument for not extending the
facility to all members of those grades. The Company should
extend the facility of staff loans to all staff grades. The
cost to the Company of implementing this would be minimal.
2. Private Mileage Rates:
The use, by staff, of their own cars to carry out Company
business is of great benefit to the Company. It saves the
Company both time and money. If the staff did not use their
own transport, it would be necessary for the Company to
provide it or to rely on public transport to travel on the
Company's business. The use of public transport would result
in the Company incurring greater expense in having to pay
overnight and meal allowances. It would lose more working
time. The workers should be paid the rate applicable to
workers in the Public Service and approved by the Revenue
Commissioners i.e. a minimum of 57.7p a mile.
3. Operative Date of P.E.S.P.
Under the agreement to put the implementation date of the
P.N.R. back by a year, the workers received a greater benefit
than their counterparts throughout the industry. This added
benefit is not reflected today as the rates of pay are
currently in line or even slightly less than those throughout
the rest of the industry. The Union is, therefore, seeking
to bring the operative date of P.E.S.P. back into line with
that applicable to the rest of the industry in order to
establish a common conclusion date for P.E.S.P. It does not
feel that the workers should now be at a disadvantage of
approximately 3.5% a year because they co-operated with the
Company by entering into an agreement when it was
experiencing financial difficulties.
COMPANY'S ARGUMENTS:
4. 1. Loan Scheme
The scheme operated by the Company is a discretionary
executive loan scheme. Due to the reduction in staff numbers
the facility has been extended downwards to members of other
grades but remains discretionary as it involves a cost to the
Company. The Company cannot accept the Union's claim for its
extension to all staff as it is a cost increasing one and
prohibited under the terms of P.E.S.P.
2. Private Mileage Rates
The Company, on completion of a survey, recently increased
the rate from 40p to 50p per mile - a rate which compares
well with that paid in the rest of the industry. It cannot
accept that there is any justification for increasing the
rate further. The claim is cost increasing and prohibited
under the terms of P.E.S.P.
3. Operative Date of P.E.S.P.
The Company has honoured and intends to honour the terms of
the P.N.R. and P.E.S.P. It rejects the Unions claim to alter
the operative date of P.E.S.P. applicable to the Company.
The dates applicable to the implementation of the national
agreements was mutually agreed by the parties and resulted in
real benefits being enjoyed by the workers by virtue the
receipt of earlier pay increase being made to them compared
with other workers throughout the rest of the industry. To
change the operative date would result in extra cost being
incurred by the Company. This is prohibited by the terms of
P.E.S.P.
RECOMMENDATION:
3. The Court considered the submissions made by the parties on
the issues before it and recommends as follows:
1. Staff Loan
The Court does not recommend that the Company extend the
terms of the discretionary loan system as requested.
2. Private mileage rate
The Court is of the opinion that the rate offered by the
Company is reasonable and should be accepted by those
concerned.
3. Operative date of P.E.S.P.
The Court, whilst accepting that the agreements which
currently operate were entirely voluntary, does not
consider that it was intended that their operation would
result in the time lag in pay adjustments that now
exists.
On the other hand it does not feel that it is open to it
to adjust the time scale of P.E.S.P.
In the circumstances the Court recommends that the parties agree
to negotiate arrangements whereby, after the terms of P.E.S.P.
have ended, the pay adjustments may be brought more into line with
other firms in the industry.
~
Signed on behalf of the Labour Court
John O'Connell
_______________________
9th September, 1992.
A. NiS./J.C. Deputy Chairman.
Note
Enquiries concerning this Recommendation should be addressed to
Ms. Aoibheann Ni Shuilleabhain, Court Secretary.