Labour Court Database __________________________________________________________________________________ File Number: CD95381 Case Number: LCR14816 Section / Act: S26(5) Parties: DUNNES STORES - and - MANDATE;MARINE PORT AND GENERAL WORKERS' UNION;SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Investigation under Section 26(5) of a dispute concerning a range of issues.
Recommendation:
The Court accepts that, while the issues before it relate to one
company, the outcome of its deliberations could have industry-wide
implications.
In this regard, the Court would refer the parties to its analysis
of the evolving state of Sunday trading.
The Court is also conscious that as the strike approached, other
issues have arisen that have further complicated the overall
picture.
In producing a Recommendation for resolution of this dispute, the
Court is of the view that a number of the issues before it require
in-depth analysis and consideration and cannot be dealt with in
the time available to the Court, at this time. These include
Pensions, Sick-pay and Posts of Responsibility all of which can be
progressed at a later stage.
The Court's recommendations on the other issues in the Unions'
submissions are as follows:-
SUNDAY WORKING:
- Employees employed prior to October, 1994, to be paid double
time for hours worked on Sundays;
- Employees employed post-October, 1994, who have Sunday as
part of their working week, to be paid time + .50 for Sunday
hours;
- Employees to have 1 in 4 Sundays off;
- Pre-October, 1994 staff should not be excluded from working
on Sunday.
'ZERO-HOUR' CONTRACTS:
- A minimum of 15 hours per week to be rostered for part-time
employees;
- No Split shifts;
- A minimum of 3 hours per day;
- Rosters to be posted 1 week in advance;
- Finishing time to be indicated, with 1 hour flexibility;
- These minima should not preclude an individual wishing to
work less hours being facilitated.
JOBS:
The present number of full-time posts taken in conjunction with
the part-time posts is significantly out of line with the Industry
norm.
As a first step towards redressing this imbalance, the Court
recommends the creation of 200 full-time posts by the Company.
P.E.S.P.:
The Court, in dealing with claims under Clause 3 of the P.E.S.P.,
has, heretofore, followed the practice of satisfying itself that
the Company involved fitted the definition of 'exceptional' as in
the Agreement. Subject to this, the Court has recommended that
the parties should agree a quid pro quo for payment of the 3%.
In this context, the Court recommends that the parties meet
immediately on resumption of normal working to conclude
discussions on this issue. Should they fail to reach agreement
within 2 months, the issue can be referred back to the Court for a
recommendation.
PROCEDURAL AGREEMENT:
The Court believes that the actions preceding this dispute and the
climate prevailing in the Company, as perceived by the Employees,
requires a major review of Company/Employee Relations.
In addition, the views expressed by the Unions in relation to
trying to progress items within the Company require careful
consideration.
It is the view of the Court that a Tribunal should be established
comprising one Company nominee, one I.C.T.U. nominee and an
Independent Chairperson to develop proposals and structures to
deal with the issues highlighted above and issues such as those
that have created the present situation.
This Tribunal should have a wide brief, this brief to be agreed
between the parties.
The Court is prepared to monitor this arrangement.
CONCLUSION:
The Court would wish to impress on both parties that the actions
preceding this dispute and the dispute itself have made it more
difficult to reach a reasoned settlement.
Nevertheless, given the serious consequences for all concerned
should the dispute continue, the Court has put forward these
recommendations.
The Court would urge the parties to consider carefully the
Recommendation, not in the context of what has been gained or
lost, but rather, in the context of what can be achieved, given
proper working relationships. To this end both parties should use
the proposed Tribunal to the fullest extent possible.
Every effort should be made to avoid any recrimination or
victimisation from either party on resumption of normal working.
Division: Mr Flood Mr Keogh Ms Ni Mhurchu
Text of Document__________________________________________________________________
CD95381 RECOMMENDATION NO. LCR14816
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(5), INDUSTRIAL RELATIONS ACT, 1990
PARTIES:
DUNNES STORES
AND
MANDATE
MARINE PORT AND GENERAL WORKERS' UNION
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Investigation under Section 26(5) of a dispute concerning a
range of issues.
THE INVESTIGATION:
2. Arising from the impasse reached in the dispute between the
Company and the Unions, and considering the exceptional
circumstances of the case, the Labour Court invited all
concerned to attend an investigation in accordance with
Section 26(5) of the Industrial Relations Act, 1990. The
investigation commenced on the morning of the 28th June,
1995, when the Court was provided with submissions by both
sides. Considerable supporting documentation was supplied
and the parties also expanded orally on their written
submissions. The investigation continued on the 29th June,
in the form of a series of separate discussions with each
side, and further discussions took place, jointly and
separately on the 2nd and 3rd July, 1995.
BACKGROUND:
Company:
3. Dunnes Stores is an Irish-owned company involved in the
retailing of foodstuffs, drapery and hardware/household
goods. Since its inception in 1944, the Company has
developed over the past 50 years to become Ireland's largest
retailer with 62 outlets nationwide, employing approximately
9,000 workers (including a number in Northern Ireland, Spain
and the U.K.). Several thousand jobs additional to the
9,000, in manufacturing and distribution companies, are
dependent on the Company's business and customers.
It is the view of Dunnes Stores that it is vital that it
places itself in a position that will enable it to respond to
the changing and growing demands of the consumer. Arising
from significant changes in competitive forces in Ireland
since the 1980s, the Company claims that it faces increased
competition from a number of new sources, in addition to the
competition faced from existing large multiples. Examples of
such new competition include franchise groups such as SPAR,
CENTRA, SUPER VALU (who operate 7 days a week, some 24 hours
a day) and the motor service-station mini supermarkets. The
arrival of a multitude of international retailers, e.g.,
Marks and Spencer, River Island, Adams, Mothercare, etc., has
also increased competition, and the expansion of Sainsbury's
into Northern Ireland and the anticipated arrival of TESCO's
will have a considerable impact on the retail market.
Dunnes Stores believes that it is imperative that it achieves
increased flexibility in order to respond to the greater
competitive challenge. Ongoing investment in new technology,
reflecting the move towards electronic banking and
convenience shopping and the upgrading of existing facilities
together with investment in new shopping centres, are vital.
History of dispute:
In November, 1993, MANDATE wrote to the Company requesting a
meeting to discuss the application of Clause 3 (Local
Bargaining 3% increase in basic pay) of the Programme for
Economic and Social Progress (P.E.S.P.). The request was
declined and on 20th January, 1994, the Union wrote to the
Company again, seeking to raise issues whereby it was
perceived that Dunnes employees were treated less favourably
in many respects than workers employed with competitors.
The Union made further efforts to raise a variety of issues
with the Company including the P.E.S.P. Clause 3 increase,
which was being implemented in a growing number of
employments.
In late Summer, 1994, the Company commenced Sunday trading
without consultation with the Union. Pickets were placed by
the Union on the relevant stores and a meeting between the
Union and senior management followed at which the Union
emphasised its opposition to a flat rate for Sunday. The
Union also advised that it had an agenda which it wished to
discuss with the Company. Following a further meeting (23rd
September, 1994) a set of proposals emerged which was not
finalised and on which agreement was not reached.
Following subsequent meetings between the parties, without
success, a final meeting was held on the 3rd of April, 1995,
at which all of the issues in question were discussed, and at
which tentative proposals were made. The Company undertook
to submit final proposals to the Union by the 12th of April,
at which time, however, it was indicated by the Company that
it would not be ready to make its submission until April
24th. The Union wrote to the Company on the 19th of April,
seeking its proposals, and in the absence of a reply,
balloted its members on the Company's proposals of the 3rd of
April. A substantial majority rejected the proposals.
The Union referred the matter to the Labour Relations
Commission but the Company declined the Commission's
invitation to attend discussions. A ballot was conducted by
the Union for industrial action and the result indicated an
86% vote in favour of strike action. Two weeks' notice was
served and pickets were subsequently placed on all of the
Company's stores (58) where MANDATE had members.
THE ISSUES:
SUNDAY TRADING:
Unions' Position
Compulsory Sunday working and flat rate of pay for Sunday are
totally unacceptable.
Until there is a legal and political consensus regarding the
vexed question of Sunday trading all Sunday working will have
to be on a voluntary basis, with a premium of Time X 2 with
the exception of the pre-Christmas period when Time X 3
should apply. In relation to Public Holidays, working should
be on a voluntary basis at a rate of Time X 2, in addition to
statutory entitlements.
Company's Position
It is of paramount importance that Dunnes Stores provides a
complete service to its customers. There is consumer demand
for Sunday trading, and shopping in Ireland, in line with
shopping in the U.K., is becoming a leisure activity.
Sunday trading, however, can only be viable at the right
cost. In order that the same quality of service can be
provided and so that products can be offered at the same cost
as during the week, Sunday trading will only be viable if
wages are paid at a flat-rate.
Accordingly, in October, 1994, staff were employed for whom
Sundays at flat rate formed part of their roster. There are
many for whom Sunday work is suitable and by whom it is
eagerly sought. Some competitors are paying a flat rate for
Sunday and others pay rates which, inclusive of Sunday
premium, are less than Dunnes' flat rate.
For existing staff, in continuing employment prior to
October, 1994, Sunday work is not compulsory and is paid at
double time.
The creation of new full-time positions would mean a
requirement to work only 1 Sunday in 7. In addition, every
third week-end will be a 'long' week-end (Saturday, Sunday
and Monday off).
`Treble time' for Sunday work at Christmas is totally
uneconomic. The intention is to change this rate to double
time effective from Christmas 1995.
STAFFING LEVELS/RATIOS:
Unions' Position
The requirement for agreed levels of part-time employment to
meet the needs of the retail sector for flexibility, and also
the demands of some workers for atypical work to match their
own personal circumstances are recognised by the Unions.
However, there currently exists in Dunnes Stores a wholly
unacceptable degree of enforced casualization of the
workforce which goes far beyond the aforementioned
requirements. The ratio of part-time employment to full-time
employment in Dunnes is totally out of line with what is
generally acceptable/agreed in the retail sector.
Dunnes Stores, as a policy decision over the last decade, has
refused to replace full-time staff, preferring instead to
employ part-time staff on a variety of part-time and casual
contracts, thus eroding the legitimate expectations of long-
term part-time workers of achieving full-time positions.
This trend in Dunnes Stores towards ever increasing levels of
part-time employment has remained unchecked and, when taken
together with other related factors, is leading to a serious
eroding of the quality of employment within the Company.
A large proportion of part-time workers in the retail sector
have aspirations towards achieving full-time employment.
Incremental progression on the service-related pay-scales
operates on the basis of completion of annual full-time
hours, i.e., 37.5/39 X 52 weeks. This results in part-time
staff remaining on point 1 of the scale until they have
worked the annual equivalent full-time hours. Because of the
application of `zero hour' contracts resulting in small
levels of weekly hours, many part-time staff remain on point
1 for many years.
This leads to high levels of staff turnover further
reinforcing the trend towards casualization. Unless this
trend is reversed, the near total casualization of the
workforce within Dunnes Stores will occur in a very short
period. This issue cannot be addressed unless there is a
clear and precise ratio which will act as a checking
mechanism/safety net. A formal ratio structure of 1
full-time to 1 part-time worker should be introduced, thereby
ensuring the availability of quality employment, while, at
the same time, maintaining acceptable levels of flexibility.
Company's Position
Due to the fact that the bulk of business is conducted on
Thursdays, Fridays and Saturdays, there is a requirement that
staff levels have to be concentrated appropriately, and,
accordingly, a large portion of staff are, of necessity,
part-time. Regarding incremental progression, it is Company
policy that even if part-time workers have not worked
sufficient hours to entitle them to an additional increment,
they are eligible for progression after 2 years.
`ZERO-HOUR' CONTRACTS:
Unions' Position
A substantial proportion of part-time employment in Dunnes
Stores is based on the concept of `zero-hour' contracts,
which means that workers are not guaranteed any number of
weekly hours, while at the same time being required to make
themselves available across all hours. Hours vary from week
to week, or from day to day, without any guaranteed minimum.
Hours often change without notice or consultation at the
discretion of management, and, on occasions workers are sent
home on arrival at notified starting time having been told to
report back at a later stage.
Because of the extreme fluctuations in hours, there is no
certainty as to a level of income, thereby denying workers
the right to make financial commitments for the future. This
concept of `zero-hour' contracts is exacerbated by the
Company's refusal to give advanced notice of daily finishing
times, which is contrary to the provisions of the Shops Act,
1938.
All part-time workers should be guaranteed a minimum weekly
contract of 25 hours, with the proviso that no shift would be
of a duration of less than five hours and split shifts would
not apply. Starting/finishing times should be posted weekly,
in advance, and once posted should be adhered to.
Existing arrangements by which some part-time workers may
have established, over a period of time, by agreement or
custom and practice, a level of weekly hours higher than 25,
should be red-circled.
Furthermore, available hours should be allocated to existing
part-time staff on a seniority basis, rather than by the
current practice of employing more and more part-time staff
at the lower point of the scale. Such a move would recognise
established part-time staff, and would go some way to meeting
aspirations to a reasonable level of income given the fact
that such staff would be increasing financial and family
commitments.
Company's Position
The concept of `zero-hour' contracts does not form part of
Company policy and all permanent staff work regular hours.
In fact, over 40% of staff work a minimum of 30 hours per
week. However, the possibility of setting a minimum number
of hours per week for part-time staff is open to
consideration. The issue of the occurrence of open-ended
shifts and split shifts could also be examined with a view to
finding a means of improving shift arrangements.
PAY: 3% under Clause 3 of the P.E.S.P.
Unions' Position
Since the claim for the implementation of Clause 3 was
submitted, Dunnes Stores has implemented productivity
measures without consultation or agreement with the Unions.
These measures include a substantial increase in trading
hours. Such increases in trading hours have formed the basis
of concession of Clause 3 by other major retailers. In its
`direct' approach to staff, Dunnes Stores management actually
conceded payment of Clause 3 P.E.S.P. in full as and from 1st
June, 1995, in recognition of the productivity measures that
they had already implemented.
Company's Position
The Company has offered the Clause 3 increase conditional on
agreement being reached on productivity measures sought from
the workforce, including Sunday trading at flat-rate.
POSTS OF RESPONSIBILITY:
Unions' Position
The introduction of the industry norm differential of a
minimum of 7.5% over the top point of the appropriate shop
scale has been sought, in recognition of the responsibility
and duties carried out by workers holding such posts. A
`post of responsibility' could be defined as a post where the
incumbent carries responsibility for the work of other staff
or for the operation of a shop or department within a
premises. Workers in many locations have assumed additional
responsibility and carry out duties such as the management of
staff and in direct dealing with buyers, for which they
receive no additional pay or recognition.
Company's Position
The management structure in Dunnes Stores is such that there
is great emphasis on the work of managers and assistant
managers. Other staff have been trained to carry out a broad
range of duties and are expected to perform a variety of
functions as a matter of course.
FORMAL PROCEDURAL AGREEMENT:
Unions' Position
A central factor in this dispute has been the continued
refusal of Dunnes Stores management to recognise the right of
the Trade Unions to represent fully their members, and to
enter into meaningful negotiations at all levels on issues of
concern. Despite the difficult circumstances of recent
weeks, the Union members (who form the vast majority of the
workforce) have indicated overwhelmingly their desire to have
their views represented by the Unions. The Company's
disregard of the role of the Unions has meant that grievances
of workers have been allowed to fester. The Company's
approach has no place in an industrial relations environment
of national consensus between the social partners. Dunnes
Stores cannot be allowed to reap the rewards of the national
consensus while at the same time not extending this consensus
at Company level. The Unions have a commitment to improving
the industrial relations environment in the Company, but this
can only be achieved by the acknowledgement by the Company of
the Unions' role.
At present there exists a formal procedural agreement with
the Transport Union in Northern Ireland. The Unions would
request that the Court, consistent with the provisions of
Section 42 of the Industrial Relations Act, 1990, directs the
Company to fully implement the provision of the Code of
Practice - Disputes Procedure (S.I. No. 1 of 1992) and Code
of Practice - Duties and Responsibilities of Employment
Representatives (S.I. No. 169 of 1993).
Company's Position
Given the nature of the business and the requirement of the
Company for flexibility and the ability to respond quickly to
market demands, it is vitally important for the Company not
to find itself locked into a rigid procedural arrangement.
SICK-PAY SCHEME:
Unions' Position
A Trade Union claim for the extension/improvement of the
existing sick-pay scheme is being pursued under Clause 4,
appendix 1 of the Programme for Competitiveness and Work
(P.C.W.). The Company has offered a part-time scheme which
is flawed and discriminates against women the majority of
whom are part-timers on the grounds that it only applies to
workers who work at least 18 hours per day. Also, unlike the
full-time scheme, no payment is made for the first three days
of illness. This is clearly discriminating against part-time
staff.
The current scheme applying to full-time staff in each
location should be extended to all categories of workers with
immediate effect.
Company's Position
The sick-pay scheme offered to part-time workers is not
unusual in the industry. The period of three days before
which sick-pay will be paid is in place in an effort to
eliminate casual sick-leave.
PENSION SCHEME:
Unions' Position
In accordance with the P.C.W., Clause 4, Appendix 1, the
introduction of a contributory pension scheme which measures
up to the norm in the retail sector is being sought for all
workers. Such a scheme would provide the following:-
1. A defined benefits scheme, i.e., 2/3 scheme,
integrated with social welfare payments;
2. Funding of the scheme as per the norms of the industry;
3. Contribution for employees at 4% and for the employer at
12-14%;
4. An entry age of 21, with the proviso of completion of
one year's service;
5. Previous service should be credited for pension
purposes.
The Company has suggested a scheme from September, 1995,
based on contributions of 3% gross from both employees and
employer. Such a defined contribution scheme is totally
unacceptable and at variance with the norm in operation in
the retail sector, offering no defined benefits and removing
itself from much of the protective legislation under the
Pensions Act, 1990.
Company's Position
The Company is committed to the introduction of a pension
scheme by September, 1995, which would be open to all
full-time and part-time staff, with a minimum entry
requirement of at least 5 years' service.
FINDINGS:
On the question of Sunday trading, the Court is conscious that
while the philosophy behind it is market-driven on the Company's
part, the practice is by no means established in the retail trade.
Indeed, the Court is aware that other large companies in this
trade sector are at an early stage of development towards
establishing Sunday trading as a norm.
The fact that those developments are at such an early stage
creates difficulties for the Court in dealing with the claims
before it in this dispute.
The Court is aware that the current dispute which has resulted in
the closure of Dunnes Stores has had major consequences for
suppliers, but more particularly for workers and management of
Dunnes Stores.
The Court intervened because of the exceptional circumstances of
this dispute, where the parties were either unwilling or unable to
allow normal exploratory talks and negotiations to reach an agreed
conclusion. The Court is now of the view that the various
problems raised by the proposal to trade on Sunday, such as
whether or not Sunday can be paid at flat rate or should attract a
premium rate, have to be addressed.
The Court accepts the highly competitive nature of the retail
trade and the Company's desire to maintain and expand its position
in the market-place. Equally, the Court accepts the Trade Union
need to protect members' job-security and quality of working life
in a structure so dependent on atypical working.
Given the complexity of the issues before it, the Court would ask
the parties to accept that the recommendations made to resolve
this dispute are specifically designed to do just that, rather
than to set `in tablets of stone' for all time, the conditions to
apply in a market that is not yet established. Many of these
issues will be clearer in time as both parties become more
experienced in what is, in effect, a new trading practice, which
neither side can say with certainty will have commercial viability
in the long term.
In this context, and in an effort to secure a successful
re-opening of the stores concerned and a full return to work,
there are certain basic issues that need to be resolved at this
stage.
RECOMMENDATION:
The Court accepts that, while the issues before it relate to one
company, the outcome of its deliberations could have industry-wide
implications.
In this regard, the Court would refer the parties to its analysis
of the evolving state of Sunday trading.
The Court is also conscious that as the strike approached, other
issues have arisen that have further complicated the overall
picture.
In producing a Recommendation for resolution of this dispute, the
Court is of the view that a number of the issues before it require
in-depth analysis and consideration and cannot be dealt with in
the time available to the Court, at this time. These include
Pensions, Sick-pay and Posts of Responsibility all of which can be
progressed at a later stage.
The Court's recommendations on the other issues in the Unions'
submissions are as follows:-
SUNDAY WORKING:
- Employees employed prior to October, 1994, to be paid double
time for hours worked on Sundays;
- Employees employed post-October, 1994, who have Sunday as
part of their working week, to be paid time + .50 for Sunday
hours;
- Employees to have 1 in 4 Sundays off;
- Pre-October, 1994 staff should not be excluded from working
on Sunday.
'ZERO-HOUR' CONTRACTS:
- A minimum of 15 hours per week to be rostered for part-time
employees;
- No Split shifts;
- A minimum of 3 hours per day;
- Rosters to be posted 1 week in advance;
- Finishing time to be indicated, with 1 hour flexibility;
- These minima should not preclude an individual wishing to
work less hours being facilitated.
JOBS:
The present number of full-time posts taken in conjunction with
the part-time posts is significantly out of line with the Industry
norm.
As a first step towards redressing this imbalance, the Court
recommends the creation of 200 full-time posts by the Company.
P.E.S.P.:
The Court, in dealing with claims under Clause 3 of the P.E.S.P.,
has, heretofore, followed the practice of satisfying itself that
the Company involved fitted the definition of 'exceptional' as in
the Agreement. Subject to this, the Court has recommended that
the parties should agree a quid pro quo for payment of the 3%.
In this context, the Court recommends that the parties meet
immediately on resumption of normal working to conclude
discussions on this issue. Should they fail to reach agreement
within 2 months, the issue can be referred back to the Court for a
recommendation.
PROCEDURAL AGREEMENT:
The Court believes that the actions preceding this dispute and the
climate prevailing in the Company, as perceived by the Employees,
requires a major review of Company/Employee Relations.
In addition, the views expressed by the Unions in relation to
trying to progress items within the Company require careful
consideration.
It is the view of the Court that a Tribunal should be established
comprising one Company nominee, one I.C.T.U. nominee and an
Independent Chairperson to develop proposals and structures to
deal with the issues highlighted above and issues such as those
that have created the present situation.
This Tribunal should have a wide brief, this brief to be agreed
between the parties.
The Court is prepared to monitor this arrangement.
CONCLUSION:
The Court would wish to impress on both parties that the actions
preceding this dispute and the dispute itself have made it more
difficult to reach a reasoned settlement.
Nevertheless, given the serious consequences for all concerned
should the dispute continue, the Court has put forward these
recommendations.
The Court would urge the parties to consider carefully the
Recommendation, not in the context of what has been gained or
lost, but rather, in the context of what can be achieved, given
proper working relationships. To this end both parties should use
the proposed Tribunal to the fullest extent possible.
Every effort should be made to avoid any recrimination or
victimisation from either party on resumption of normal working.
~
Signed on behalf of the Labour Court
4th July, 1995 Finbarr Flood
M.K./D.T. _______________
Deputy Chairman
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Michael Keegan, Court Secretary.