Labour Court Database __________________________________________________________________________________ File Number: CD93183 Case Number: LCR14067 Section / Act: S26(1) Parties: IRISH SHELL LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Claim by the Union, on behalf of 65 workers, for payment of the 3% increase under Clause 3 of the Programme for Economic and Social Progress (P.E.S.P.).
Recommendation:
5. Having considered the submissions of the parties and the oral
arguments put forward at the hearing, the Court does not consider
that genuine and realistic negotiations have taken place in this
instance. The Company's demands seriously outweigh the benefits;
to seek the elimination of a 5% bonus in return for a 3% salary
increase, even with a modest lump sum payment and inclusion for
pension purposes is clearly untenable and particularly so when it
is allied to further demands on pay scales.
On the other hand, it is the view of the Court that past
concessions made by the workforce or the simple fact that the
Company is doing well are not, as argued by the Union, sufficient
reason to warrant an adjustment under the terms of Clause 3
without reference to the provisions under which negotiations are
to be conducted.
Accordingly the court recommends that the parties make a fresh
start to negotiations taking account of the above comments.
Division: Mr Heffernan Mr Keogh Mr O'Murchu
Text of Document__________________________________________________________________
CD93183 RECOMMENDATION NO. LCR14067
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES: IRISH SHELL LIMITED
(REPRESENTED BY THE IRISH BUSINESS EMPLOYERS CONFEDERATION)
and
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Claim by the Union, on behalf of 65 workers, for payment of
the 3% increase under Clause 3 of the Programme for Economic and
Social Progress (P.E.S.P.).
BACKGROUND:
2. The Company paid the increase due to workers under the second
phase of the P.E.S.P. with effect from 1st January, 1993. The
Union claimed payment of the 3% increase provided for under Clause
3 of P.E.S.P. with effect from that date. At local level
discussions the Company offered to pay the 3% in return for the
following productivity measures:
1. New salary scales for future entrants.
2. A buy out of the 5% productivity allowance.
3. A no strike clause for the duration of P.E.S.P.
4. Embargo on claims already dealt with by the Court.
5. Working party on Job Evaluation Scheme.
The Union rejected the proposals. The issues were referred to the
Labour Relations Commission and a conciliation conference was held
on the 2nd February, 1993. At conciliation the Company modified
its list of proposals to:
(1) New salary scales.
(2) Buy out of the 5% productivity allowance.
The proposals were rejected by the Union. The dispute was
referred to the Labour Court by the Labour Relations Commission on
the 22nd March, 1993. A Court hearing was held on the 27th April,
1993.
UNION'S ARGUMENTS:
3. 1. Salary Scales:
The Company is the only one in the oil industry seeking this
type of change. Such a pay structure as proposed by the
Company would undermine the long established parity/uniformity
of pay rates in the industry. The issue however has not been
totally rejected and is still being considered by the Union
Committee.
2. Productivity Allowance:
It is unrealistic of the Company to expect workers to
surrender this allowance which is inbuilt in the Company/Union
agreement and an integral part of the workers' salary package
in return for payment of the 3% increase.
3. The Union has already made significant contributions to
productivity in the Company in terms of increased
computerisation, reduction in numbers of workers, and the
achievement of I.S.O. 9002. The Union also agreed to a
significant change at Dublin Terminal resulting in the loss of
the Grade 1A post and a potential saving to the Company in the
region of #30,000 including on-going costs.
4. The Company is the second largest in the Irish Market. It
is successful and profitable. Three smaller competitors in
the industry have already paid the 3% increase. The cost of
this claim is less than #50,000 per annum and would put no
financial strain on the Company.
COMPANY'S ARGUMENTS:
4. 1. Salary Scales:
Following the issue of Labour Court Recommendation 13746 the
Company appointed 5 temporary workers to permanent positions.
The Court recommended that "the parties discuss pay scales
that they consider may assist in maintaining competitiveness
and more accurately reflect the rates of pay in the market
place". The Company's proposed pay scales apply to new
entrants which it hopes to recruit over the next few years.
They compare very favourably with the upper quartile of the
market. The new salary scales represent no immediate savings
to the Company, and would allow the Company to offer new
employment opportunities.
2. Productivity Allowance:
The Company's offer to buy out the 5% productivity allowance
is reasonable and realistic. Past concessions are
specifically covered by the existing 5% bonus. The Company is
justified in seeking the elimination of this bonus in return
for payment of the 3% increase.
3. The Company is entitled to seek these changes in return
for payment of the 3% increase in order to remain competitive,
efficient, and effective in a difficult market environment.
RECOMMENDATION:
5. Having considered the submissions of the parties and the oral
arguments put forward at the hearing, the Court does not consider
that genuine and realistic negotiations have taken place in this
instance. The Company's demands seriously outweigh the benefits;
to seek the elimination of a 5% bonus in return for a 3% salary
increase, even with a modest lump sum payment and inclusion for
pension purposes is clearly untenable and particularly so when it
is allied to further demands on pay scales.
On the other hand, it is the view of the Court that past
concessions made by the workforce or the simple fact that the
Company is doing well are not, as argued by the Union, sufficient
reason to warrant an adjustment under the terms of Clause 3
without reference to the provisions under which negotiations are
to be conducted.
Accordingly the court recommends that the parties make a fresh
start to negotiations taking account of the above comments.
~
Signed on behalf of the Labour Court
Kevin Heffernan
__________________
4th May, 1993. Chairman
T.O'D./J.C.
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Tom O'Dea, Court Secretary.