FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : SMURFIT CORRUGATED CASES LIMITED (REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Flood Employer Member: Mr Brennan Worker Member: Ms Ni Mhurchu |
1. Shift premium for 3-shift working.
BACKGROUND:
2. The Company manufactures corrugated packaging for the manufacturing and food sectors. It employs 169 at its Cork plant.
In late 1996 the Company and the Union agreed a new comprehensive partnership agreement entitled "Vision 2000". The agreement provided for the introduction of three -shift operations to any area of the plant where it was deemed necessary.
The Company claims that the agreement was necessary to ensure its survival and to enable it to prosper into the next century in a very competitive environment. It has to compete with other Irish producers of packaging and in particular with low cost imports, mainly from the UK.
The agreement provided for the following:-
- The need to address high labour cost versus competition both internal and external.
- A new pay and remuneration package to eliminate the dependence on high overtime and to bring the Company into line with the EU directive on working hours.
- The creation of a team culture to achieve Company, i.e. all employees' objectives.
- Agreement to collectively overcome all obstacles with a view to securing the future of the Cork plant.
- Pay for proven and available skills.
- The opportunity to move up the pay ladder for those on low grade.
To support this new Pay and Remuneration Package, the Company had to achieve a 30% increase in productivity throughout the plant :-
- Realignment of shifts to meet customer demands, including the introduction of a third shift when required.
- Flexibility in all aspects of jobs, including manning levels and new technology implementation.
- Full co-operation and participation by everyone in developing and implementing the Vision 2000 philosophy and culture.
The Company claims that in January, 1997 it was necessary to introduce three-shift working on the Company's Bobst Printer as a result of increased customer demands. Both Union and Management agreed to a compressed shift (i.e. 12-hour shifts) with a 33.3% shift premium operating from 27th January, 1997. A review of the operation was scheduled for the 7th April, 1997. The agreement provided for 12-hour shifts Monday to Friday working 48 hours one week and 36 hours two weeks over a 3 week cycle. In return, each employee received a "once off" payment of £800.00. In addition, it will also pay a "once off" payment of £200 to all employees.
Following the review, the Company decided that the shift premium of 33.3% was adversely affecting its competitive position, and changed it as follows: 33.3% for night shift; and 25% for day/evening shift.
The Union objected to the Company's proposal to reduce the shift premium. It was agreed by the workers to continue with the new system under protest, until all procedures had been exhausted.
The Union claims that the 33.3% shift premium should be maintained.
As no agreement was possible between the parties the dispute was referred to the Conciliation Service of the Labour Relations Commission. Conciliation conferences were held on the 22nd May, 1997 and the 4th June, 1997 but no agreement was reached. The dispute was referred to the Labour Court on the 6th June, 1997 under Section 26(1) of the Industrial Relations Act, 1990. The Court investigated the dispute on the 23rd June, 1997.
UNION'S ARGUMENTS:
3. 1. The existing shift premium of 33.3% for working the compressed shift should be retained.
2. The plant in Dublin has not been asked to move to a 3-shift operation.
3. Workers operating on the night shift have less facilities (no canteen) and more responsibilities than a 2-shift operation.
4. Any additional hours worked does not attract overtime rates.
5. Shift working, and in particular working at night, can have a very detrimental effect on both health and social life for those concerned.
COMPANY'S ARGUMENTS:
4. 1. As a result of a substantial increase in business it was necessary to introduce a third shift to meet the demand.
2. The Company has paid a sum of £800 to each employee for the 3-shift arrangement.
3. The Company operates in a very competitive market. It must keep costs down to survive.
4. The Company is offering a "once off" payment of £200 to all employees to accept the principle of a third shift.
5. The introduction of a 3-shift operation is provided for in the Company/Union partnership agreement.
RECOMMENDATION:
It is accepted by the Union that 3-shift working is required by the business needs and that the issue in dispute is the rate for such shifts.
While 33.3% was paid for the initial trial period, this was, as stated in the Company document of 3 February 1997, to be accepted without precedent and to deal with the special demands at the time.
Equally the Employees have indicated and the Company has agreed, subject to satisfactory payments arrangements that they would prefer to work 12 hour shifts.
Taking into account all the issues involved the Court recommends that the Company offer in its submission to the Court be modified as below in return for acceptance by the Employees:-
(1) Once-off payment to all Employees of £200 to accept the principle of third shift.
(2) Once-off payment of £800 to any Employee when required to go on 3-shift for the first time.
(3) Interim arrangements for compressed shift to be 33.3% for first 6 months of a 3-shift when it is extended to a new area/person.
(4) The shift pattern to be 3 shift or compressed 3 shift as decided by the majority of Employees.
(5) The Shift Premium to be 25% for days and evenings 33.3% for nights for standard shift.
If compressed shifts the rate to be, 25% for 12 hour days and 33.3% for 12 hour nights.
Signed on behalf of the Labour Court
Finbarr Flood
27th June, 1997______________________
L.W./S.G.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Larry Wisely, Court Secretary.