Labour Court Database __________________________________________________________________________________ File Number: CD93253 Case Number: LCR14097 Section / Act: S26(1) Parties: C. MORTON AND SONS LIMITED - and - IRISH NATIONAL UNION OF VINTNERS' GROCERS |
Dispute concerning the implementation of Clause 3 (local bargaining) of the Programme for Economic and Social Progress (P.E.S.P.).
Recommendation:
5. The Court has considered the submissions made by the parties.
Taking account of the recent trading experience of the Company and
its apparent inability to offset the cost of the increase, the
Court recommends that a modified increase of 1.50% payable from the
1st August be conceded in full settlement of the Union's claim.
Division: Mr O'Connell Mr Brennan Mr O'Murchu
Text of Document__________________________________________________________________
CD93253 RECOMMENDATION NO. LCR14097
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES: C. MORTON AND SONS LIMITED
(REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS' CONFEDERATION)
and
IRISH NATIONAL UNION OF VINTNERS' GROCERS
AND ALLIED TRADES' ASSISTANTS
SUBJECT:
1. Dispute concerning the implementation of Clause 3 (local
bargaining) of the Programme for Economic and Social Progress
(P.E.S.P.).
BACKGROUND:
2. 1. The Company operates as a supermarket and employs 25
workers. The Union sought discussions with the Company on the
payment of a 3% increase under the terms of Clause 3 of the
P.E.S.P. to 14 of its members.
2. A meeting between the parties was held on 16th February,
1993 and the Union made its claim for payment of the 3%
increase in respect of past flexibility and co-operation. The
claim was rejected by the Company. The claim was referred to
the Labour Relations Commission and a conciliation conference
was held on 25th March, 1993.
3. The Company pleaded inability to pay due to trading
difficulties. It argued that it already had full flexibility
and co-operation and did not see any scope for further
productivity gains. The Union repeated its claim for payment
of the 3% increase on the basis of past productivity. No
progress was possible and the claim was referred to the Labour
Court under Section 26(1) of the Industrial Relations Act,
1990 on 7th April, 1993. A Labour Court investigation took
place on 6th May, 1993.
UNION'S ARGUMENTS:
3. 1. The workers give the Company a high degree of flexibility
in relation to work practices. The workers' co-operation in
this area is unparalleled in the trade and has provided the
Company over the years with great productivity gains. The
workers' flexibility should be recognised by concession of the
claim. The Company's only argument has been that its trading
position has recently been difficult. The recent relaxation
of interest rates has already improved trade and this is
expected to continue. The workers are not responsible for the
downturn in profits.
2. There is an established relationship between the Company's
pay rates and those set by the Dublin Grocery Joint Industrial
Council (J.I.C.). The Union has successfully concluded
negotiations on Clause 3 with the majority of employers
covered by the J.I.C. In 1987 the workers agreed to lesser
rates of pay than those of the J.I.C. This situation was
always viewed by the workers as temporary. Concession of the
Clause 3 claim would set about reducing the anomaly
3. The Company has argued that its high level of wage and
staff costs preclude it from conceding the claim. It should
be noted that the workers have long service (details
supplied). Despite their service, the workers have no pension
scheme and the sick-pay scheme is not up to the trade
standard.
COMPANY'S ARGUMENTS:
4. 1. The Company is unable to bear any further increase in
staff costs. Its trading position has deteriorated alarmingly
in recent times (details supplied) and any further cost
increases will undermine its ability to keep trading. The
Company's wage costs to sales ratio is well above the industry
norm (details supplied).
2. The Company has been badly affected by recent high
interest rates and price competition between the larger
multiples. The Company enjoys the reputation of being a
specialist store and has been particularly hard hit by the
recession. Declining profits have been exasperated by V.A.T.
increases, changes in consumer patterns, a decline in passing
trade and a changed roadway system.
3. The local bargaining provision in the P.E.S.P. was
included to allow unions to seek additional increases where
companies were performing particularly well. It was agreed
that this provision would only apply in exceptional cases.
The Company cannot be considered exceptional in any sense of
the word. It is a small retailer and it is being edged out of
a very competitive market. Any further increases in costs
would have serious repercussion for all concerned.
RECOMMENDATION:
5. The Court has considered the submissions made by the parties.
Taking account of the recent trading experience of the Company and
its apparent inability to offset the cost of the increase, the
Court recommends that a modified increase of 1.50% payable from the
1st August be conceded in full settlement of the Union's claim.
~
Signed on behalf of the Labour Court
John O'Connell
____________________
27th May, 1993. Deputy Chairman.
J.F./J.C.
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Jerome Forde, Court Secretary.