Labour Court Database __________________________________________________________________________________ File Number: CD96106 Case Number: LCR15134 Section / Act: S26(1) Parties: CANTRELL AND COCHRANE (IRELAND) LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Rationalisation plan.
Recommendation:
Both sides were agreed on the need for change.
However, while the Union side indicated a willingness to increase
productivity it was not prepared to accept a loss in earnings.
The Company for its part was confident that there need not be a
loss of earnings in the new situation.
The Court while accepting that these two positions can be
compatible is conscious that there is a lack of belief, on both
sides, as to the final position.
The Court having considered carefully the situation believes that
the stated aims of both parties is best achieved by opting for the
new bonus system. The phasing of this to be adjusted as follows:
50% for 3 months
30% for 3 months
15% for 3 months
Given the difficulties outlined above, the Court would be prepared
to monitor the effect on earnings of the new Scheme, after 12
months, with an interim review after 6 months.
In addition the Court makes the following Recommendations on the
other issues before it:-
1. Buy In - A payment of £4,500.
- In the case of long term Casuals a
payment should be made. This
payment to be agreed between the
parties.
2. Severance For - A payment of £750 per year of
Casuals service.
3. Annual Payment - To be continued on a Red Circle
basis to those currently employed.
4. Early Start - Breakfast payment to cease.
5. Trunker Compensation - 1.5 x annual loss.
6. Grade Structure - This should be dealt with by the
parties, following overall
agreement.
7. Rate for the Job - Company proposal to stand.
8. Shift Principle - All Employees to be eligible for
shift work.
9. Shift Rate - Rates as discussed.
Meal allowances to continue but to
be phased out over period to be
agreed.
10. Maintenance Manning - Third post to continue but to go
within 15 months.
11. Payment by Cheque - Given security risks involved both
sides should support proposal but
Company should accept transfer on a
voluntary basis.
12. Shop Steward
Guaranteed Overtime - Should be eliminated but Company to
pay £2,000 to employee Social Fund.
Division: Mr Flood Mr Keogh Mr Rorke
Text of Document__________________________________________________________________
CD96106 RECOMMENDATION NO. LCR15134
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES:
CANTRELL AND COCHRANE (IRELAND) LIMITED
AND
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Rationalisation plan.
BACKGROUND:
2. In March 1996 the Company proposed the introduction of a
comprehensive rationalisation plan which would achieve
significant savings. It involved redundancies, substantial
changes in work practices, and increased productivity. The
Company maintains that the plan was essential in order to
remain competitive. The plan, specifically in relation to
the bonus scheme, was rejected by the Union on the grounds
that workers would suffer a substantial loss in their
earnings. The Labour Court investigated the dispute on 3rd
November 1995. On the 17th November 1995 the Court issued
LCR14970 which recommended as follows:-
"The Court ...... would urge the parties to enter
into discussions immediately to consider the
problems facing the Company and to agree the
appropriate way to overcome these difficulties.
...... the Court would recommend that sufficient
time be given to arriving at an agreement. The
Court believes these discussions could be completed
within 3 months."
Subsequently the parties entered extensive discussions but
agreement at local level was not possible. The dispute was
referred to the Labour Relations Commission and four
conciliation conferences were held between the 21st February,
1996 and the 6th March, 1996.
Agreement was reached on a number of issues. (Details
supplied to the Court). Following the final conciliation
conference agreement had not been reached on the bonus scheme
or on the following issues:-
1. Buy-in, 2. Severance for Casuals, 3. Annual Payment, 4.
Early Start, 5. Trunker Compensation, 6. Grade Structure, 7.
Rate for the Job, 8. Shift Principle, 9. Shift Rate, 10.
Maintenance Manning, 11. Payment by Cheque, 12. Shop Steward
Guaranteed Overtime.
The dispute was referred to the Labour Court by the Labour
Relations Commission on the 8th March, 1996. A Court hearing
was held on the 12th March, 1996. A letter recommendation
was issued on the 12th April 1996.
UNION'S ARGUMENTS:
3. 1. The Company's rationalisation plan is premised on job
losses and cuts in earnings which, as a combined
package, results in too severe an effect on workers
remaining in the Company.
2. The workers concerned have significant service. They
have been in the Company's employment through a decade
of change and a number of rationalisation programmes.
3. The workers are prepared to work harder. They have
accepted changes in conditions, job losses, reduction in
earnings, due to loss of guaranteed over-time, and agreed
to consider a severance package. The Union has accepted
significant changes yielding substantial savings to the
Company.
4. The workers concerned have lost confidence in Management
as a result of having been in the employment through 5
Rationalisation plans. It is impossible for them to
consider seriously an efficiency-based bonus scheme in
which Management not only wants to secure the systems and
jobs, but also requires the remaining workforce to put in
greater effort for less reward.
COMPANY'S ARGUMENTS:
4. 1. The Company faces serious financial difficulties and it
is imperative that it achieve cost reductions in order to
remain competitive. It has incurred substantial losses
since September 1995.
2. Throughout discussions the Company has endeavoured to
facilitate the Union. It has made a major shift in its
proposals to buy out a significant element of the
production bonus by introducing the possibility of
retaining a bonus scheme if it could be made cost-
effective.
3. It is crucial that the plan is implemented if the Company
is to survive competitively in the grocery sector. It's
cost base, burdened with bonus payments, will not compete
successfully if savings cannot be achieved. The Company,
in an effort to meet the core earning aspirations of
workers, has made serious attempts to be flexible.
RECOMMENDATION:
Both sides were agreed on the need for change.
However, while the Union side indicated a willingness to increase
productivity it was not prepared to accept a loss in earnings.
The Company for its part was confident that there need not be a
loss of earnings in the new situation.
The Court while accepting that these two positions can be
compatible is conscious that there is a lack of belief, on both
sides, as to the final position.
The Court having considered carefully the situation believes that
the stated aims of both parties is best achieved by opting for the
new bonus system. The phasing of this to be adjusted as follows:
50% for 3 months
30% for 3 months
15% for 3 months
Given the difficulties outlined above, the Court would be prepared
to monitor the effect on earnings of the new Scheme, after 12
months, with an interim review after 6 months.
In addition the Court makes the following Recommendations on the
other issues before it:-
1. Buy In - A payment of £4,500.
- In the case of long term Casuals a
payment should be made. This
payment to be agreed between the
parties.
2. Severance For - A payment of £750 per year of
Casuals service.
3. Annual Payment - To be continued on a Red Circle
basis to those currently employed.
4. Early Start - Breakfast payment to cease.
5. Trunker Compensation - 1.5 x annual loss.
6. Grade Structure - This should be dealt with by the
parties, following overall
agreement.
7. Rate for the Job - Company proposal to stand.
8. Shift Principle - All Employees to be eligible for
shift work.
9. Shift Rate - Rates as discussed.
Meal allowances to continue but to
be phased out over period to be
agreed.
10. Maintenance Manning - Third post to continue but to go
within 15 months.
11. Payment by Cheque - Given security risks involved both
sides should support proposal but
Company should accept transfer on a
voluntary basis.
12. Shop Steward
Guaranteed Overtime - Should be eliminated but Company to
pay £2,000 to employee Social Fund.
~
Signed on behalf of the Labour Court
18th April, 1996 Finbarr Flood
T.O'D./S.G. _______________
Deputy Chairman
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Tom O' Dea, Court Secretary.