Labour Court Database __________________________________________________________________________________ File Number: CD94174 Case Number: LCR14452 Section / Act: S26(1) Parties: WOCO INDUSTRIAL COMPONENTS LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Dispute concerning the Company's survival plan.
Recommendation:
The Court having considered all the views expressed by the parties
in their oral and written submissions finds that, given the
present circumstances of the Company and the Industry, if the
Company is to be successful and continue to develop and ensure
security of employment the problems as highlighted to the Court
will have to be meaningfully addressed.
To this end the Court recommends as follows:-
1. Production Targets
A review should be carried out jointly by nominees of the
Company and the Union as a matter of extreme urgency, pending
the outcome of such review the targets proposed by the
Company should be implemented on a trial basis.
2. Absenteeism
The sick pay scheme is not a mechanism which should be used
to carry out Management functions. It is for Management to
deal with any abuses that arise in this area in accordance
with the standard disciplinary procedures.
3. Annual Leave
Annual Leave should be taken in the current annual leave
year. Where through the requirements of the Company this
cannot be achieved carry-over should be permitted. In
individual exceptional circumstances agreement could be given
for a limited amount of annual leave to be carried over.
4. Pay
Payment of the 1st Phase of the P.C.W should be deferred
pending a review of the state of the Company's business in
September, 1994.
5. Rejects
Both parties should take such steps as are necessary to
reduce rejects to a minimum. The Court notes the workers
will co-operate in seeking to resolve this issue.
Division: MrMcGrath Mr Brennan Mr Rorke
Text of Document__________________________________________________________________
CD94174 RECOMMENDATION NO. LCR14452
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES:
WOCO INDUSTRIAL COMPONENTS LIMITED
(REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS CONFEDERATION)
AND
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Dispute concerning the Company's survival plan.
BACKGROUND:
2. The Company is involved in the manufacture of injected
moulded rubber components for the European car industry. It
employs 120 workers at Carrick-on-Shannon. It has incurred
substantial losses over the past number of years. In
January, 1994 the Company introduced a survival plan, the
main features of which are as follows:-
(a) Interchangeability/Transfer: to be accepted in the
event of redundancy or temporary lay-off (Deferred
until after May, 1994).
(b) Production Targets: Employee co-operation in
achieving production targets subject to the Company
providing every assistance in eliminating any
obstacle to their achievement. The Company
confirmed that where poor performance persisted
that an employee would be subject to disciplinary
measures.
(c) Absenteeism: In a bid to reduce its absenteeism
level of 7% the Company confirmed that those
employees who failed to remit social welfare
payments to the Company in accordance with its sick
pay scheme would be debarred from benefit. Equally
those individuals who persistently used up their
benefit under the scheme year upon year would be
removed from the scheme.
The Company stated that if absenteeism did not
reduce substantially over the 4 months following
the implementation of the plan the Company proposed
that the scheme be withdrawn for a 12-month trial
period
(d) Rejects: The level of rejects i.e. 8% (+) was
unacceptable. Operators had to take responsibility
for the levels of scrap/rejects of their machine.
Notwithstanding technical problems operators would
have to pay greater attention to QC requirements;
accurately report faults/problems and maintain
machines to proper standards of cleanliness.
(e) Annual Leave: Leave had to be taken within the
leave year otherwise it would be foregone save for
exceptional circumstances; the Company may at its
discretion allow an employee to carry-over a few
days to be taken within the first 6 months of the
following leave year.
(g) Pay: In view of its commercial difficulties the
Company proposed a 12 month pay freeze for the
period 1/1/94 - 31/12/94 following upon the expiry
of the P.E.S.P. on 31/12/93.
The plan was the subject of a number of meetings at local
level but no agreement was reached. The dispute was referred
to the Labour Relations Commission and a conciliation
conference was held on the 3rd March, 1994. Subsequent to
the conciliation conference the specific issues in dispute
related to production targets, rejects, the pay freeze and
absenteeism. As agreement was not possible the dispute was
referred to the Labour Court on the 21st March, 1994. The
Court investigated the dispute in Longford on the 13th April,
1994.
UNION'S ARGUMENTS:
3. 1. Production targets in the plant have been the subject of
dispute for a considerable time. The Company introduced
extra duties which have been carried out under protest
until such time as a proper assessment was carried out.
An assessment should be done by the Union's Industrial
Engineer but the Company is not agreeable. In 1993, a
study carried out by I.P.C. concluded clearly that the
workers concerned were achieving an average performance
of 82% B.S.I., which warranted the introduction of an
incentive bonus scheme. This was disputed by the
Company and since then the workload on operators has
increased steadily without payment.
2. Rejects: The Union cannot accept that "operators must
take responsibility for the level of scrap/rejects on
their machines". Operator fault is an almost negligible
contributory factor to the level of rejects.
3. Pay: The current pay rates of the workers concerned are
not excessive. In the absence of any incentive scheme
the only increases achievable are under National Wage
Agreements. Workers cannot be expected to increase
productivity and accept a pay freeze.
4. The Company's sick pay scheme is minimal. Interference
with this meagre scheme will worsen conditions of
employment, while it will impact little on company
profitability and demoralise workers.
COMPANY'S ARGUMENTS:
4. 1. The Company, by virtue of its own performance and severe
competition, has been forced to take remedial action.
The proposed plan, when viewed in the context of other
such plans adopted by competitor companies, is moderate
in terms of its impact on workers.
2. The Company is agreeable to have the situation relating
to targets/rejects assessed by an independent body. The
Union's Industrial Engineer is not acceptable to the
Company. Both parties accepted the I.P.C. to do an
evaluation of certain duties in 1993. The Company does
not understand the Union's resistance to independent
assessment.
3. Given the Company's commercial difficulties and its
financial performance (details supplied to the Court).
Management's request for a pay freeze is reasonable.
Other companies within the industry and region have
confirmed pay freezes of 2 years and 1 year
respectively (details supplied to the Court). The basic
rates of pay of the workers concerned compare favourably
with the rates in other employments in the North West.
The Company has paid its workers all phases of P.E.S.P.
including the local bargaining element which was paid on
the understanding that workers would do their utmost to
meet the required performance levels and assist the
Company's return to profitability. The Company's
position is entirely consistent with the Programme for
Competitiveness and Work (Clause 3) which requires that
the parties when considering whether or not to apply the
basic increases "have due regard to ....... the economic
and commercial circumstances of the particular firm...".
4. The Company's plan in relation to its sick pay scheme is
reasonable given the fact that the level of absenteeism
is unacceptably high.
RECOMMENDATION:
The Court having considered all the views expressed by the parties
in their oral and written submissions finds that, given the
present circumstances of the Company and the Industry, if the
Company is to be successful and continue to develop and ensure
security of employment the problems as highlighted to the Court
will have to be meaningfully addressed.
To this end the Court recommends as follows:-
1. Production Targets
A review should be carried out jointly by nominees of the
Company and the Union as a matter of extreme urgency, pending
the outcome of such review the targets proposed by the
Company should be implemented on a trial basis.
2. Absenteeism
The sick pay scheme is not a mechanism which should be used
to carry out Management functions. It is for Management to
deal with any abuses that arise in this area in accordance
with the standard disciplinary procedures.
3. Annual Leave
Annual Leave should be taken in the current annual leave
year. Where through the requirements of the Company this
cannot be achieved carry-over should be permitted. In
individual exceptional circumstances agreement could be given
for a limited amount of annual leave to be carried over.
4. Pay
Payment of the 1st Phase of the P.C.W should be deferred
pending a review of the state of the Company's business in
September, 1994.
5. Rejects
Both parties should take such steps as are necessary to
reduce rejects to a minimum. The Court notes the workers
will co-operate in seeking to resolve this issue.
~
Signed on behalf of the Labour Court
24th May, 1994 Tom McGrath
T.O.D./M.M. _______________
Deputy Chairman
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Tom O'Dea, Court Secretary.