Labour Court Database __________________________________________________________________________________ File Number: CD94478 Case Number: LCR14656 Section / Act: S26(1) Parties: SWISSCO LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Clause 3 of the Programme for Economic and Social Progress (P.E.S.P.).
Recommendation:
The Court having considered the submissions made and taking
cognisance of the trading position of the Company does not
consider it could recommend concession of the Union's claim at
this time.
The Court notes that at date of hearing negotiations are
inconclusive as to the retrospective element of the P.E.S.P. and
is of the view that this item should be finalised as a matter of
urgency.
The Court recommends that the Union agrees to postpone their claim
under Clause 3 until the Company's results for 1994 are available.
In the light of the these results the matter should be discussed
locally with a view to reaching agreement.
Division: Ms Owens Mr Keogh Mr Rorke
Text of Document__________________________________________________________________
CD94478 RECOMMENDATION NO. LCR14656
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES:
SWISSCO LIMITED
(REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS CONFEDERATION)
AND
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Clause 3 of the Programme for Economic and Social Progress
(P.E.S.P.).
BACKGROUND:
2. The Company operates within the wet ambient ready meals
foodmarket, producing convenience foods mainly for export to
the U.K. multiple retail sector. It employs approximately 84
workers.
In early 1994, the Union submitted a claim for an increase of
3% under the terms of Clause 3 of P.E.S.P. The Company
rejected the claim.
The dispute was referred to the Labour Relations Commission.
A conciliation conference was held on 7th June, 1994. As no
agreement was reached the dispute was referred to the Labour
Court by the Labour Relations Commission on 14th September,
1994 in accordance with Section 26(1) of the Industrial
Relations Act, 1990. A Labour Court hearing took place in
Cork on 5th October, 1994.
UNION'S ARGUMENTS:
3. 1. The Company has been slow to implement other increases
under the terms of the P.E.S.P and arrears due in
respect of Phase 2 and Phase 3 remain outstanding.
2. The workers through their flexibility have made a
significant contribution to the Company. They have
co-operated fully with management during a period which
has seen a reduction in the workforce and the
introduction of new machinery. This has resulted in
substantial savings to the Company. In the
circumstances the payment of the 3% increase is
justified.
COMPANY'S ARGUMENTS:
4. 1. The Company is pleading inability to pay the local
bargaining element of the P.E.S.P. on the grounds
outlined in relation to Clause 3 and on the basis that
it:-
(a) Realised substantial losses in 1992 and 1993;
(b) operates in an extremely competitive business
environment where the actual market is contracting;
(c) must continue to control costs in order to remain
competitive and has had to invest heavily in new
plant technology in order to gain more business.
2. 95% of the Company product is sold to the U.K. market.
This leaves margins extremely sensitive and vulnerable
to currency and exchange rates.
3. Considerable market difficulties have developed as a
result of over-capacity in the manufacturing base. This
has resulted in the withdrawal of two producers from the
market. The remaining competitors operate from within
the U.K. where lower production and labour costs apply.
4. The Company conducts over 50% of its business with one
major U.K. based retail multiple who governs the price
of ambient ready meals. It will not be possible to
secure the price increases necessary to absorb the cost
of concession of the P.E.S.P..
RECOMMENDATION:
The Court having considered the submissions made and taking
cognisance of the trading position of the Company does not
consider it could recommend concession of the Union's claim at
this time.
The Court notes that at date of hearing negotiations are
inconclusive as to the retrospective element of the P.E.S.P. and
is of the view that this item should be finalised as a matter of
urgency.
The Court recommends that the Union agrees to postpone their claim
under Clause 3 until the Company's results for 1994 are available.
In the light of the these results the matter should be discussed
locally with a view to reaching agreement.
~
Signed on behalf of the Labour Court
9th January, 1995 Evelyn Owens
F.B./M.M. ____________
Chairman
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Fran Brennan, Court Secretary.