Labour Court Database __________________________________________________________________________________ File Number: CD93350 Case Number: LCR14138 Section / Act: S20(2) Parties: PACKARD ELECTRIC IRELAND LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION;AMALGAMATED TRANSPORT AND GENERAL WORKERS' UNION |
Alleged breach by the Company of the sub-contract clause contained within the Union/Company Agreement.
Recommendation:
5. Having examined the submissions from the parties and the oral
evidence given at the hearing the Court is satisfied that the
Company was not in breach of the Company/Union Agreement in this
instance. The Court accordingly does not recommend concession of
the Union's claim for compensation.
The Court, however is concerned that any misunderstandings which
might arise in relation to future work orders are dealt with
expeditiously and in a way which does not threaten the employment
prospects in the Company or weaken its competitive base, and
recommends that the parties meet to discuss the best means of
achieving this objective.
Division: Ms Owens Mr McHenry Mr O'Murchu
Text of Document__________________________________________________________________
CD93350 RECOMMENDATION NO. LCR14138
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 20(2), INDUSTRIAL RELATIONS ACT, 1969
PARTIES: PACKARD ELECTRIC IRELAND LIMITED
(REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS CONFEDERATION)
and
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
AMALGAMATED TRANSPORT AND GENERAL WORKERS' UNION
SUBJECT:
1. Alleged breach by the Company of the sub-contract clause
contained within the Union/Company Agreement.
BACKGROUND:
2. 1. The Company is a manufacturer of wiring harnesses for the
motor industry. Due to a downturn in the automotive industry,
the Company and the Union negotiated a voluntary redundancy
programme in 1991, which reduced the workforce by 200 workers.
During 1992, a further redundancy programme was agreed to
reduce the workforce by 190 workers. Phase one of the
Programme is nearly completed with 69 workers to leave the
Company.
2. In May, 1993, Packard Europe received an order from
Vauxhall Motors for 12,000 T. Car Harnesses for its Ellesmere
Port facility. The Company in Ireland refused the order as it
was already working to capacity with excessive amounts of
overtime. As a result, the order was placed with a sister
plant in Portugal. The Portugal plant was not licensed by
Vauxhall to perform the necessary quality checks on the
harnesses and it was agreed by the companies that Portugal
would produce the harnesses and that Dublin would perform the
quality certification (QC) before shipping them to the U.K.
3. The Unions were advised of this 3 days before the first
batch of harnesses arrived in Dublin. This was the first
occasion that harnesses for Vauxhall in the U.K. had been
produced anywhere other than Dublin. When the Unions became
aware of the situation, the workers refused to perform the
required QC checks on the harnesses. The Unions accused the
Company of breaching the Sub-Contract clause of the
Company/Union Agreement.
4. Negotiations took place between the parties and the
Company indicated that:-
1. As long as the schedule upturn persisted, the Company
would not proceed with phase 2 of the Redundancy
Programme.
2. A portion of the order would be completed in Dublin
and overtime would be offered to workers for the
duration of the work in Portugal.
3. A pool of temporary workers would be put in place in
the event of any further short-term increases in
production.
The Union sought #75 per worker compensation for breach of the
Agreement.
5. The parties agreed that the dispute would be referred to
the Labour Court and that the parties would be bound by the
Court's Recommendation. No dispute was entered into
concerning the 12,000 T. Car harnesses produced in Portugal.
The dispute was referred to the Labour Court on 2nd June,
1993. A Labour Court investigation took place on 21st June,
1993.
COMPANY'S ARGUMENTS:
3. 1. The Company did not breach the Sub-Contract clause. To
have done so, the Company would have to have subcontracted the
work. This is not the case. The work in question was never
"owned" by the Company and therefore could not have been
sub-contracted. The work was never in the Company's control
and it did not have the capacity to complete the work.
2. The Union is seeking reward by way of compensation for
work which the workers have not done. The work brought no
benefit to the Company. The Company employs over 1,000
workers, paying competitive wages. The Company is suffering
financial difficulties and must remain competitive. No
payment of compensation is warranted and the Company cannot
consider such a payment in the form of an attendance bonus.
UNIONS' ARGUMENTS:
4. 1. The Unions object to the sub-contracting of work while the
Company is seeking redundancies. The Company holds the
licence to produce harnesses for the Ellesmere Port facility
and has been its main supplier. The terms of the Sub-Contract
clause provide for the manufacture of all main harnesses in
Dublin (details supplied). The workers cannot accept that
their work is being done in Portugal at a time when job cuts
are being sought due to production shortfalls.
2. Within the terms of the Company/Union Agreement (details
supplied), the Dublin plant should be used to full capacity
and the harnesses should have been programmed for production
in Dublin. The Unions are not disputing the fact that the
other plants produce T. Car harnesses but that the harness
produced for Ellesmere Port has to date been exclusively
produced in Dublin.
3. The payment of compensation to the entire workforce is
justified by the Company's breach of the Sub-Contract
Agreement. The Company has already set a precedent for the
payment of a voucher to workers as an incentive to work
maximum overtime. An attendance incentive would result in
increased production overall and lower unit costs.
RECOMMENDATION:
5. Having examined the submissions from the parties and the oral
evidence given at the hearing the Court is satisfied that the
Company was not in breach of the Company/Union Agreement in this
instance. The Court accordingly does not recommend concession of
the Union's claim for compensation.
The Court, however is concerned that any misunderstandings which
might arise in relation to future work orders are dealt with
expeditiously and in a way which does not threaten the employment
prospects in the Company or weaken its competitive base, and
recommends that the parties meet to discuss the best means of
achieving this objective.
~
Signed on behalf of the Labour Court
Evelyn Owens
_____________________
14th July, 1993. Deputy Chairman.
J.F./J.C.
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Jerome Forde, Court Secretary.