FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : WOODFAB LIMITED, AUGHRIM (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Employer Member: Worker Member: |
1. Claim for implementation of Phase 3 of the Programme for Competitiveness and Work (PCW).
BACKGROUND:
2. The Woodfab plant in Aughrim is one of 2 sister-companies which are owned by the Smurfit Group and which are engaged in the timber processing industry. The sister company is located in Fermoy. Both plants are regarded as stand-alone operations. The dispute concerns a claim, on behalf of approximately 150 operatives, for implementation of Phase 3 of the PCW. The claim was rejected by the Company on the grounds of inability to pay, due to a downturn in business, generally. The Union stated that its members are on a low to average basic wage and receive only the bare minimum from national pay rounds. The Company stated that it has accumulated losses of £3.4m since 1990, of which a loss of £1.9m was incurred in 1995 alone (the figures relate to the Aughrim and Fermoy plants). The Company claims that the cost of the claim would amount to in excess of £50,000 per annum, and could not be sustained on top of existing losses. [The Company is, at present, taking an action against Coillte concerning the latter's alleged abuse of its monopoly position in the industry - a provision of £.5m been included in the Company's accounts to cover its legal costs]. The Union's claim was the subject of a conciliation conference under the auspices of the Labour Relations Commission, at which agreement was not reached. The dispute was referred to the Labour Court, on the 25th of April, 1996, in accordance with Section 26(1) of the Industrial Relations Act, 1990. The Court investigated the dispute, in Arklow, on the 25th of June, 1996.
UNION'S ARGUMENTS:
3. 1. The workers have suffered wage losses in 1995 and 1996 with the introduction of short-time working and the reduction of overtime.
2. Rates of pay in the industry are below the national average (details supplied) and there is neither a sick-pay scheme nor a pension scheme in operation to cater for general workers.
3. Other adjacent sawmilling industries, which are faced with the same marketing conditions and Coillte practices, have paid all or most of the terms of the PCW to date.
4. A sister-company of Woodfab Limited, i.e., Woodfab Packaging, Arklow, has honoured the terms of the PCW.
5. The Company is a subsidiary of the Smurfit Group which recorded profits of over £420m in 1995.
COMPANY'S ARGUMENTS:
1. The Company is in a substantial on-going loss making situation.
2. The Company cannot afford to take on any cost increases and, as evidenced by the on-going lay-off/redundancy situation, must seek cost reductions where possible.
3. The Company competes, from a relatively high cost base, against a substantial number of lower-cost operators.
4. The PCW provides that increases be negotiated with due regard being had to the economic and commercial circumstances of the particular firm, employment or industry. In the light of its economic and commercial circumstances, the Company should be exempt from the increases provided for under Phase 3 of the PCW.
RECOMMENDATION:
Having considered the submissions of the parties and noting the present financial situation of the Company, the Court recommends that Phase 3 of PCW be paid with effect from the 1st of July, 1996.
Signed on behalf of the Labour Court
Evelyn Owens
16th July, 1996______________________
M.K./S.G.Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Michael Keegan, Court Secretary.