Labour Court Database __________________________________________________________________________________ File Number: CD95239 Case Number: LCR14769 Section / Act: S26(1) Parties: IDV OPERATIONS IRELAND LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
'Contracting out' of Security Services.
Recommendation:
The Court considered the written and oral submissions of both
parties.
The Court is of the view that progress can and should be made in
meaningful discussion between the parties.
The Court therefore recommends that the parties commence
discussions immediately, to explore all the options available to
meet the Company's requirements.
In the event of the parties failing to reach agreement the matter
can be referred back to the Court.
Division: Mr Flood Mr McHenry Mr Rorke
Text of Document__________________________________________________________________
CD95239 RECOMMENDATION NO. LCR14769
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES:
IDV OPERATIONS IRELAND LIMITED
AND
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. 'Contracting out' of Security Services.
BACKGROUND:
2. 1. IDV Ireland Ltd. is part of the IDV Group which is the
drinks subsidiary of Grand Metropolitan - a
Multinational Company. The Company produces Baileys,
Sheridan's and Smirnoff branded drinks for the
International and domestic markets. Sales of these
products have declined over the years and profit margins
have been eroded because of competition. It has been
difficult for the Company to obtain price increases for
their products because of competition, even though
material costs have increased. The Company must remain
competitive and efficient within the IDV Group in order
to secure the future employment of its employees.
2. The Company has put forward a rationalisation and
restructuring plan to secure the future of the Company.
Some internal services were evaluated (canteen/security)
and it was decided that the provision of these services
by the Company itself was not cost effective. The
canteen service has been "contracted out" and workers
employed in the canteen were redeployed or declared
redundant. The Company also proposes to contract out
the security service and redeploy their 6 security
staff. The Union could not agree to this proposal and
the matter was referred to the Labour Relations
Commission. Conciliation conferences took place on 2nd
March, 1995 and 20th March, 1995. As no agreement was
possible the dispute was referred to the Labour Court on
30th March, 1995 in accordance with Section 26(1) of the
Industrial Relations Act, 1990. The Court investigated
the dispute on the 27th April, 1995.
UNION'S ARGUMENTS:
3. 1. The Union objects to the "contracting out" of the
Company's security service. Management has not shown
that the saving of #180,500 is necessary for the viability
of the Dublin plant. Our members contend that the
Company has broken an agreement it made with its
security staff in 1987. The Company undertook not to
jeopardise the security of employment of its own staff
through the employment of contractors.
2. As a result of this agreement with the Company, security
staff agreed to continue to share security duties with
an outside security Company. The security staff has
offered to discuss alternative cost saving measures but
the Company has rejected this. The skill, training,
commitment and experience of the security staff should
be retained and recognised as an asset to the Company.
The recent evaluation exercise undertaken by the
Company scored security the second highest operative
grade.
COMPANY'S ARGUMENTS:
4. 1. The Company has put together a "Transition Plan" with an
overall objective, the achievement of "World Class"
customer service, quality and cost effectiveness by
September, 1996. In the first year of the Transition
Plan the Company achieved an improved performance in
terms of customer service, plant performance and cost
management.
The Company has identified security as an area where
savings can be made. The Company can hire outside
contractors to provide security at half the cost of the
present service. The contracting out of security will
not result in workers being declared redundant. The
Company is proposing that security staff have the option
of (1) voluntary redundancy, (2) redeployment with IDV
Operations, (3) employment with Securicor - the
contractors.
2. The core business of IDV operations is the production of
Baileys, Sheridan's and Smirnoff branded products and
the management of the supply chains. Services such as
security are not part of the core business. The
contracting out of the security service would save the
Company #180,500 per annum. The Company must be allowed
to continually review its operations to ensure that it
stays ahead of its competitors and remains a viable
Company.
RECOMMENDATION:
The Court considered the written and oral submissions of both
parties.
The Court is of the view that progress can and should be made in
meaningful discussion between the parties.
The Court therefore recommends that the parties commence
discussions immediately, to explore all the options available to
meet the Company's requirements.
In the event of the parties failing to reach agreement the matter
can be referred back to the Court.
~
Signed on behalf of the Labour Court
19th May, 1995 Finbarr Flood
L.W./D.T. _______________
Deputy Chairman
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Larry Wisely, Court Secretary.