FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : JOHNSON BROTHERS LIMITED (REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Employer Member: Worker Member: |
1. Proposed new terms/conditions of employment.
BACKGROUND:
2. The dispute before the Court concerns a proposal by the Company to introduce new terms/conditions of employment and also implement a consolidated rate of pay for all employees in the Warehouse Operations. There are 36 permanent and 4 temporary staff currently employed in this area. The Company claims that it is imperative that the present system be changed to enable it to remain competitive. Its current bonus system is archaic and originates from the 1970s.
The Company claims that the new terms/conditions of employment are vital in order to meet the changing patterns of consumer requirements based on seven day shopping.
The Company has proposed the restructuring for the Warehouse Operations on the following lines:-
- Rostering: 19 employees to remain on "normal" hours - 8.30 a.m. to
5 p.m.; 8 employees to work 7.30 a.m. to 4 p.m. and 8
employees to work 11 a.m. to 7.30 p.m.
Six Day Operations: It is essential to move to six day working to meet customer demands for 7 day shopping and to provide for the "just in time" service which customers require.
Shift Work: In anticipating a continued growth of volume for the business and to provide for future growth the Company requires the acceptance in principle of shift work.
Consolidated Rate The Company has proposed a consolidated rate of pay
of Pay: of £275.00 per week. This rate incorporates a 2x5% premium payment provided certain quality and attendance criteria are met. Compensation for those with earnings in excess of £275.00 per week is proposed as follows:-
ServiceCompensation
1 - 5 years 6 months
6 - 10 years 12 months
11 + years 18 months
The Union claims that it accepted the need for change. It agreed to the concept of multiskilling and is also prepared to discuss the proposal of annualised hours. It cannot accept however, the proposed changes in relation to operational issues such as the Rostered Day - 7.30 a.m. to 7.30 p.m. (39 hour week) and Shift Working. Both proposals would have the effect of reducing earnings by eliminating overtime. Furthermore, the proposal to change to a six day working week will significantly alter a long standing and preferred working week of Monday to Friday.
With regards to the financial issues, the plan proposes to reduce the wages for some employees and increase wages of others for the same changes. The Company has offered a sum of £750.00 gross to five employees earning between £270 and £290 per week in return for change but this was rejected by the members. The Company's formula to compensate members with 2 years the annual loss in 2 phases was also rejected. The Union proposed that the calculations should be based on P60s or the previous twelve months whichever is the greater.
As no final agreement was possible between the parties at local level, the dispute was referred to the Conciliation Service of the Labour Relations Commission. Conciliation conferences were convened on the 21st June, 1996, 19th July, 1996, 12th August, 1996, 19th August, 1996 and 26th August, 1996. Following the conciliation conference on the 26th August, 1996 the Industrial Relations Officer put forward proposals to settle the dispute. The proposals as outlined were rejected by the union members.
As no agreement was possible between the parties the dispute was referred to the Labour Court under Section 26(1) of the Industrial Relations Act, 1990. The Court investigated the dispute on the 15th November, 1996.
UNION'S ARGUMENTS:
3. 1. The financial package proposed by the Company lacks incentive to change for many employees. Those on higher rates of pay are being compensated for loss of earnings only.
2. The Company should offer a separate payment for the proposed changes.
3. The proposed plan will result in a reduction in salary of £200 per week for some employees which is unacceptable to the Union.
4. The Union seeks compensation for its members based on their P60s or the previous twelve months earnings whichever is the greater.
COMPANY'S ARGUMENTS:
4. 1. The Company operates in a very competitive market. It needs the proposed restructuring in order to survive.
2. The proposed new rates of pay are above those being paid by competitors.
3. The current bonus system was introduced in the 1970s and is totally out of date with current trends and is a cost penalty to the Company.
4. The proposed restructuring is customer driven. The Company must provide quality service to its customers, at a competitive price, in order to survive.
RECOMMENDATION:
The Court having considered all of the issues raised by the parties in their oral and written submissions recommends that the proposals of the Industrial Relations Officer (26th August, 1996) be accepted subject to the following amendments.
1. That compensation be paid to those employees with loss of earnings at twice the annual loss based on the employees P60 or the previous 12 months earnings whichever is the greater.
2. That a payment of £1,000 (gross) be made to 5 employees earning between £270 and £290 per week. This payment to be inclusive of any compensation payments which would have applied under the proposals for compensation for loss of earnings.
3. That subject to the package being accepted the total payment of compensation for loss of earnings be made on the date of acceptance of the recommendation.
Signed on behalf of the Labour Court
Tom McGrath
29th November, 1996______________________
L.W./D.T.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Larry Wisely, Court Secretary.