Labour Court Database __________________________________________________________________________________ File Number: CD95357 Case Number: LCR14828 Section / Act: S26(1) Parties: ADM RINGASKIDDY - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Change in manning levels and work practices.
Recommendation:
Having considered the submissions from the parties the Court is of
the view that the Company's offer as contained in letter dated
25th May, 1995 (appendix 2 of Company's submission) should be
revised at paragraph 3(c) to read:
"A once off lump sum of 2% of current annual basic pay be
paid on settlement of the Agreement by 31st August, 1995"
and that the offer as so amended be accepted.
The Court also recommends the setting up of a joint monitoring
committee to monitor the effects of the revised manning levels
with particular regard to the safety aspects which are of major
concern to the Union.
Division: Ms Owens Mr Keogh Mr Rorke
Text of Document__________________________________________________________________
CD95357 RECOMMENDATION NO. LCR14828
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES:
ADM RINGASKIDDY
AND
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Change in manning levels and work practices.
BACKGROUND:
2. 1. The Company is engaged in the production of citric acid.
In December, 1990, ADM purchased the citric acid
business from Pfizer. The purchase included a plant in
the U.S. and the Ringaskiddy facility. The business
incurred serious losses in 1991 and the Company
implemented a "Survival Plan" aimed at bringing the
business back to profitability. It involved agreement
with the Union on manning reductions and changes in work
practices, improved raw materials purchasing, increased
selling prices and technical and plant efficiency
improvements. The Company also made substantial
investments in plant additions and facilities.
2. Despite all the improvements the business suffered a
severe downturn in 1994 due to poor sales. This was
mainly caused by a dramatic increase in the volume of
citric acid from China being sold in Europe at very low
prices and selling price reductions by other major
European competitors. The result of this was a
prolonged production slowdown and a reduction in selling
prices.
3. In April, 1994, the Company sought a further agreement
with the Union in relation to manning levels and work
practices. The Company stated that it was imperative
that the proposals be accepted in order to maintain the
viability of the Company. The Company is trading in a
very competitive market environment. The proposals were
rejected in a ballot of the Union's members by a
majority of 16 to 1.
4. The dispute was referred to the Labour Relations
Commission. Conciliation conferences took place on 1st
September, 1994, 10th January, 1995 and 1st March, 1995.
As no agreement was possible the dispute was referred to
the Labour Court on 9th June, 1995 in accordance with
Section 26(1) of the Industrial Relations Act, 1990.
The Labour Court investigated the dispute on 11th July,
1995.
UNION'S ARGUMENTS:
3. 1. The Union is opposed to any further changes in manning
levels and work practices. The changes proposed by the
Company will impose severe hardship on our members. The
plant will not operate safely with the manning levels
proposed by the Company. The Union respectively
requests the Court not to endorse this major
productivity deal.
2. The Company failed to implement the 1991/1992 Agreement
on manning levels (LCR14614 refers). The proposed
changes, if introduced will save the Company substantial
amounts of money to the detriment of the workers. The
only concession the Union is prepared to accept is the
suppression of the vacancies currently not filled under
the 1991/1992 Company/Union Agreement (8 posts). The
Union will not accept any further reduction in manning
levels at the plant.
COMPANY'S ARGUMENTS:
4. 1. The raw materials for the Company's products - molasses,
sulphuric acid and caustic soda must be shipped to
Ringaskiddy. Ninety per cent of our finished products
is shipped to customers all over Europe. The Company is
at a major disadvantage compared to our competitors in
Europe who have access to raw materials and market place
facilities at their door step.
2. The Company must reduce its cost base to remain viable.
The Company's sister plant in North Carolina has twice
the capacity of Ringaskiddy and is a very low cost
producer. It has the ability to service the total ADM
world market, if required. It is manned by 145 people
compared to 175 at Ringaskiddy. The Company must
continually strive to ensure that production costs are
lower than those of our sister plant in the United
States.
3. The Chinese increased their citric acid production by
160% between 1990 and 1993. They now supply 25% of the
European market. The ADM market share has fallen from
27% to 20% over the past eighteen months as a result of
Chinese competition. This competition has resulted in
the Company having to reduce production volumes and
reduce selling prices in order to remain competitive.
4. The success of the Company depends on our ability to
contain costs and improve efficiency. Failure in this
area could mean the closure of the plant at Ringaskiddy.
The Company's overall financial package to the employees
is very generous in this type of business and should be
accepted. The twelve redundancies sought by the Company
will be on a voluntary basis.
RECOMMENDATION:
Having considered the submissions from the parties the Court is of
the view that the Company's offer as contained in letter dated
25th May, 1995 (appendix 2 of Company's submission) should be
revised at paragraph 3(c) to read:
"A once off lump sum of 2% of current annual basic pay be
paid on settlement of the Agreement by 31st August, 1995"
and that the offer as so amended be accepted.
The Court also recommends the setting up of a joint monitoring
committee to monitor the effects of the revised manning levels
with particular regard to the safety aspects which are of major
concern to the Union.
~
Signed on behalf of the Labour Court
18th July, 1995 Evelyn Owens
L.W./D.T. ____________
Chairman
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Larry Wisely, Court Secretary.