FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : AVONMORE FOODS PLC - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Flood Employer Member: Mr Keogh Worker Member: Ms Ni Mhurchu |
1. Rehearing arising from Labour Court Recommendation 15202.
BACKGROUND:
2. In May 1996 a dispute between the parties concerning the Company's proposal to transfer its transport operation (milk collection and heavy haulage) to an independent operator (Tankfreight) was the subject of a Labour Court investigation. In LCR 15202 which was issued in June 1996 the Court recommended as follows:-
"Having considered the written and oral submissions made by the parties, the Court is of the view that no real discussions have taken place on this issue because of the stance taken by both sides.
The Court recommends that the parties enter into meaningful negotiations immediately on the Company proposal, with a view to reaching a mutually acceptable position. These discussions should cover all aspects of the operation including the perceived deficiencies in the present system.
These negotiations to be completed within 6 weeks of the date of issue of this recommendation".
Subsequently the parties entered into protracted negotiations. The Union totally rejected the transfer of the operation to Tank Freight but was agreeable to discuss the transport operation in the context of internal rationalisation. The parties considered a payment by results system which would be based on a payment for each tonne and gallon carried, with flexibility between heavy haulage and milk collection, requiring 9 trucks to move from heavy haulage to milk collection for the peak period. The rate would cover all of the costs associated with the operation of the trucks and also the wages for both the main
and relief drivers. 12 trucks would be taken out of the system. Flexibility in routing would be essential. The Union accepted the need for flexibility in the operation and bringing about efficiencies in the milk collection system. It also accepted that a number of redundancies were required, however, agreement was not possible specifically in relation to proposed routes and the redundancy package on offer. On the 15th November, 1996, the Company sought a further Labour Court hearing to which the Union agreed. The Court investigated the dispute on the 17th February, 1997.
UNION'S ARGUMENTS:
3. 1. The crucial areas for resolution are the redundancy terms to be applied and the position of those drivers who remain within the transport system. The Union's claim for 5 weeks' pay plus statutory is reasonable and was paid by the Company to workers in another of its Divisions. The Union is seeking the same treatment for the workers concerned. In discussions, the Union finally modified its claim as follows:-
5 weeks per year for workers with 25 years service
4 weeks per year of service for next 5 years
3 weeks for remaining years with special regard for the small number of long term workers.
The Company response is unacceptable.
2. The drivers concerned are prepared to transfer from haulage to milk collection as required, with current pay rates to apply to September '97 and when new routes become available discussions could then be held.
3. The workers concerned are prepared to give flexibility to the Company. However, Management has not yet given the Union any information on structured planned routes for the milk collection system. This was always forthcoming when the Company changed milk collection routes on previous occasions. It is crucial that planned routes are made available for the drivers' consideration, and that an acceptable redundancy package is offered to the workers.
COMPANY'S ARGUMENTS:
4. 1. The unsustainable inefficiencies in the transport system must be addressed. The Company is prepared to manage this non-core business on a payment by results system provided it achieves the necessary efficiency.
2. The Company will guarantee no loss of earnings for the first year for all full time drivers and will review cases who were disadvantaged under the new system and agree change of routes or loss of earnings.
3. The Company has agreed to 19 redundancies even though only 12 are required. This is to ensure that the payment by results will work by increasing the work available. A £1,000 payment will be given as an optional payment to drivers where there is a perceived loss of earnings.
4. Under the payment by results system the heavy haulage drivers will stay on their current payment system with some minor changes i.e. 9 vehicles doing milk work during peak periods.
5. For 32 drivers on heavy haulage work, pay remains the same as will rates and volume. For 32 milk drivers pay changes from basic plus gallon rate, to gallon rate plus rate per mile travelled, with a minimum guaranteed earnings equivalent to the current base pay for a basic weeks work.
The redundancy package on offer (details to the Court) will attract the required number on a voluntary basis. This package will cost £850k for savings of £700k.
The Company requests the Court to recommend either the transfer to Tankfreight or payment by results system as a very reasonable approach to a very serious problem and that one or the other should be implemented without delay.
RECOMMENDATION:
Following the failure of the parties to reach agreement on the Company proposal to contract out the transport operation the parties entered into discussion on alternative options.
Having considered the written and oral submissions before it the Court is of the view that the alternative proposal of a payment by results system is the right way forward as a means of achieving a viable in-house transport scheme.
The Court therefore recommends that this proposal be accepted but that the Company package and timing, be adjusted as follows in order to address the employees' concerns on redundancy terms and the position of drivers remaining in the system:-
1. The new system to come into operation from 1 September, 1997
2. Current payment systems to continue until 1 September, 1997.
3. The one year earnings guarantee to be increased to two years.
4. The maximum figure of £35,000 in the Company Redundancy proposal be increased to £50,000.
5. Option of individual privatisation can be discussed between the Union and the Company if the parties so wish.
Signed on behalf of the Labour Court
Finbarr Flood
3rd March, 1997______________________
T.O'D./S.G.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Tom O'Dea, Court Secretary.