FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : CARTON BROTHERS 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. (1) Redundancy terms. (2) Loss of earnings. (3) Loss of overtime. (4) Terms/conditions of remaining staff in Shercock.
BACKGROUND:
2. The Company is an integrated poultry processing and chilled distribution business. It slaughters approximately 260,000 birds per week at its plant in Shercock, of which approximately 90,000 to 100,000 are portioned. The market requirements in the poultry industry have changed from a demand for whole birds to portioned and value-added products such as chicken with sauces and marinated chicken. The Company claims that in order to survive it must develop the capability to meet this demand and that this is not feasible at the Shercock plant. It has, therefore, acquired a minority shareholding in a new processing plant to be opened in Summerhill, Co. Meath. To secure the investment, the Company claims that it must reduce the two shifts in the portioning area in Shercock to one shift. This will result in the reduction of full-time staffing levels by 28 and the re-assignment of a further 9 staff from full-time to part-time work.
Management and the Union failed to reach an agreement on the issues related to the reduction of staff and the dispute was referred to the conciliation service of the Labour Relations Commission. Three conciliation conferences were held on the 15th May, the 27th May, and the 4th June, 1997, and tentative agreement was reached on some of the issues. However, as agreement in full could not be reached between the parties the dispute was referred to the Labour Court in accordance with Section 26(1) of the Industrial Relations Act, 1990. The Court investigated the dispute on the 18th June, 1997, in Dublin.
UNION'S ARGUMENTS:
3. 1. Redundancy terms:-
Redundancy compensation of 5 weeks' gross pay per year of service plus statutory should be paid to the employees who are to be made redundant. The loss of their jobs is entirely due to the Company's decision to re-locate. The portioning section is the busiest in the factory and cannot cope with the demand for products, yet staff are now to be made redundant.
2. Loss of earnings/loss of overtime:-
The Company is attempting to improve its profitability at the expense of the Shercock workers who have given full and unequivocal commitment to the Company over the past twenty years. The reduction of one shift of part-time workers will result in a loss of shift earnings and a loss of overtime earnings. The Company has offered to pay compensation of 1.5 times the annual loss in respect of shift earnings, but the workers believe the Company should protect their earnings by red-circling. No offer has been made in respect of the loss of overtime.
3. Skilled rate:-
All operatives involved in filleting, band saw work and box weigh should receive the skilled rate of £9.94 per week for these duties. The rate should apply to the three operatives and the three packers who interchange for relief purposes on the band saw machine. If skilled work is carried out for more than four hours per day the rate should apply for the entire day.
4. Adult rate:-
Full adult rate is currently applied at 21 years of age. As new recruits frequently commence employment at 16 years of age they should be paid the full rate, following a probationary period, on appointment to permanency or to a temporary part-time position.
5. Pension for part-timers:-
A substantial group of part-time employees are anxious to become members of the Company's non-contributory pension scheme which is currently confined to full-time employees only. Some of the staff work up to thirty hours or more per week but may never attain full-time status in the Company.
6. Integration of bonus:-
Staff receive a very low basic pay compared with industrial rates of pay in the locality. Many of them would qualify for Family Income Supplement if they did not receive the production bonus of £44 per week. Pensions are also based on basic pay. It is essential that the bonus, which does not vary in accordance with work done and is index-linked to national wage increases, should be integrated with the basic rate of pay.
COMPANY'S ARGUMENTS:
4. 1. Redundancy terms:-
The Company wishes to pursue all options such as work sharing, career breaks, etc. but agrees that a level of redundancy is probably inevitable. A redundancy formula of 4 weeks' pay per year of service (inclusive of basic pay and bonus) plus statutory entitlement is reasonable considering the Company's financial position.
2. Loss of earnings:-
The Company is willing to pay compensation of 18 months verifiable loss of income to workers transferring from full-time to part-time work as a direct result of the new project in Summerhill. The Union has agreed to payment on a phased basis.
3. Skilled rate:-
Payment of the skilled rate should be made to only five filleters on any given day. The band saw operators, but not the packers, should also receive the rate. The Company will review the position of box weigh operators when the new box weigh system is introduced, although the Company strenuously contests this element of the Union's claim.
4. Adult rate:-
The adult rate will be paid at 18 years of age except for temporary employees who are employed to cover for holidays at Christmas, Easter and during the summer months of June, July, August and September.
5. Pension for part-timers:-
Unlike many other companies, the Company funds a generous pension scheme and sick pay scheme. However, the issue of part-timers joining the pension scheme was not discussed in any detail.
6. Integration of bonus:-
The Union's claim to consolidate the bonus with basic pay cannot be sustained on any reasonable grounds. The claim has no merit whatsoever, it bears no reality to the precarious nature of the Company's finances, it is opportunistic and it is in breach of Partnership 2000.
7. The Company pays the highest rate of pay in the industry, it is not a profitable business and its very survival depends on the success of the Summerhill project. The Company's position on the issues above is on the basis that the additional claims entered by the Union on the 4th June, 1997, are withdrawn in full.
RECOMMENDATION:
The Court, having considered the written and oral submissions made by the parties, recommends as follows on the issues before it:-
1.Redundancy terms:-
Redundancy payment of 5 weeks' pay per year of service (basic pay and bonus) plus statutory entitlements to employees made redundant.
2.Loss of earnings:-
Compensation to be paid at 1.5 times the annual loss for those transferring from full-time to part-time working.
3.Loss of overtime:-
Compensation to be paid at 1.5 times the annual loss for those transferring from full-time to part-time working.
4.Terms/conditions of remaining staff:-
(A)Skilled rate:-Operatives on band saws and filleting to receive the rate. When new system is operative a review to be completed of the box weighers' claim.
(B)Adult rate:-Adult rate to be paid at 18 years of age, except for holiday relief employees.
(C)Pension for part-timers:-This claim has not been discussed by the parties in any detail. The parties should explore the options on this issue.
In relation to the claim for integration of bonus into basic salary, the Court, given the financial state of the Company, recommends that the Union should agree to postpone its claim for a more appropriate time.
Signed on behalf of the Labour Court
Finbarr Flood
27th June, 1997______________________
D.G./D.T.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Dympna Greene, Court Secretary.