Labour Court Database __________________________________________________________________________________ File Number: CD92671 Case Number: LCR13907 Section / Act: S26(1) Parties: WESTPORT CLOTHING - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Claim for the payment of the 3% wage increase under the terms of Clause 3 (local bargaining) of the Programme for Economic and Social Progress (P.E.S.P.).
Recommendation:
5. Having regard to present difficulties being experienced by the
Company the Court does not recommend concession of the Union's
claim.
Division: Mr O'Connell Mr McHenry Mr Rorke
Text of Document__________________________________________________________________
CD92671 RECOMMENDATION NO. LCR13907
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES: WESTPORT CLOTHING
(REPRESENTED BY THE FEDERATION OF IRISH EMPLOYERS)
and
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Claim for the payment of the 3% wage increase under the terms
of Clause 3 (local bargaining) of the Programme for Economic and
Social Progress (P.E.S.P.).
BACKGROUND:
2. 1. The Company was established in 1963 and employs 65
workers. It exports 75% of its total product to the United
Kingdom.
2. In January, 1992, the Union made a claim on the Company
for the payment of the local bargaining clause as provided for
in the P.E.S.P. The claim was rejected by the Company because
of market-place difficulties arising out of exchange rate
fluctuations.
3. The claim was referred to the Labour Relations Commission
and a conciliation conference was held on 16th September,
1992. A negotiated solution was not possible and the claim
was referred to the Labour Court on 29th October, 1992, under
Section 26(1) of the Industrial Relations Act, 1990. A Labour
Court investigation took place in Galway on 11th December,
1992 (earliest date suitable to the parties).
UNION'S ARGUMENTS:
3. 1. The Union has made every effort to negotiate a settlement
of the claim. It is prepared to entertain any reasonable
proposals of the Company. The Company has pleaded inability
to pay the 3% increase primarily because of exchange rate
difficulties. The Union questions this contention because
most raw materials are purchased in the United Kingdom. The
Company does not appear to have financial difficulties as it
has recently completed extensive renovations.
2. The Company's refusal to negotiate on the claim may have
more to do with the fact that it has maximised its need for
flexibility, co-operation and interchangeability from the
workforce. Workers' pay levels are low (details supplied) and
the increases sought will not create undue hardship on the
Company. The Union is willing to negotiate within the terms
of clause 3 of the P.E.S.P. on whatever reasonable proposals
the Company may have.
COMPANY'S ARGUMENTS:
4. 1. The Company has paid the first 2 phases of the P.E.S.P.
Phase 3 is due to be paid on 1st January, 1993. The Company
will find it difficult to meet this wage increase. In
September, 1992, the Company informed the Union that the then
sterling exchange rate was causing the Company difficulties.
Since then the exchange rate has collapsed further and the
Company is in a loss making situation. Despite these
circumstances the Company will attempt to continue on a 5 day
week but this will have to be reviewed.
2. The Company cannot absorb the exchange rate fluctuations.
Factory efficiencies have not changed over the past number of
years and to offset any cost increases in production is
practically impossible. The clothing sector has been
particularly hard-hit by exchange rate fluctuations and the
subsequent down-turn in business. The claim can only be met
by price increases from customers. In the present
circumstances, this option is not viable.
RECOMMENDATION:
5. Having regard to present difficulties being experienced by the
Company the Court does not recommend concession of the Union's
claim.
~
Signed on behalf of the Labour Court
John O'Connell
__________________
22nd December, 1992. Deputy Chairman.
J.F./J.C.
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Jerome Forde, Court Secretary.