FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : WOCO INDUSTRIAL COMPONENTS LIMITED (REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr McGrath Employer Member: Mr Pierce Worker Member: Mr Rorke |
1. Hearing arising from Labour Court Recommendation No. LCR15589.
BACKGROUND:
2. The Company is located in Carrick on Shannon It manufactures moulded rubber components for the European Automotive Industry and employs approximately 116 workers. In July, 1997 a dispute between the parties was the subject of a Labour Court investigation. In LCR15589, which was issued on the 15th July, 1997, the Court recommended as follows:-
"The Court is gravely concerned in the light of the information supplied by the parties that if arrangements are not put in place to improve the efficiency and cost effectiveness of the firm, the future of the Company and the security of the employment will be put in jeopardy.
Concurrent with the training programme the parties should negotiate terms and conditions for multi-machine operation the negotiations to include payment, the areas to be included in multi-machine operation, arrangements to monitor the implementation of the operation and to address any difficulties that may arise, these negotiations should be completed on or before 22 August 1997. In the event the parties are unable to reach agreement the Court will consider the issues in dispute and issue a definitive recommendation."
Both parties accepted the recommendation and entered negotiations. Substantial progress was made in relation to the terms and conditions to be agreed on the implementation of multi-machine operations. However, a new development emerged on the 17th of September, 1997. On that date a senior member of Management from the Board of Woco Group of Companies indicated to the Plant Manager in Carrick on Shannon and to SIPTU that following his inspection and assessment of the situation at Carrick on Shannon he had no other option but to use the period between the 18th of September, 1997 and the 18th of December, 1997 to evaluate the performance of the plant with a view to determining its future viability. The following three proposals were put to the workforce as being essential for the survival of the plant.
1. Multi-machine operation to be put in place.
2. Trimming and finishing of parts to be completed at the machine at no additional cost.
3. A 5% improvement in productivity.
The Union objected to the Company's unilateral imposition of these conditions. Further negotiations failed to resolve the issues in disptue. Subsequently the Company referred the dispute to the Labour Court for a definitive recommendation. A Court hearing was held in Cavan on the 30th of October, 1997. A letter recommendation was issued on the 7th of November, 1997.
UNION'S ARGUMENTS:
3. 1. The Union accepted the Labour Court recommendation and was willing to negotiate the terms of and conditions for multi-machine operators together with a number of other issues. The Company without prior discussion or agreement, sought to impose its own terms.
2. The Union offered to operate machines during lunch-breaks. This would have the effect of increasing productivity levels by 7%. Workers would agree to carry out a cutting and trimming operation at the machines provided that existing payments would continue to be paid. The Company would advance the option of short-time working should operatives agree to this.
3. These proposals would be put to workers, to be recommended for acceptance and would remain in force pending the issue of the Court's recommendation and a worker's ballot on same.
4. If the Company could not accept the above proposal the Union would consider the appropriateness of putting the Company's non-negotiable proposals to the workforce.
5. The Union requests the Court to issue a definitive recommendation on the issues in dispute prior to the Company's ultimatum of September, 1997. The Union requests a separate recommendation on the issue of machine operatives, and also in the event of closure that appropriate severance terms be paid.
COMPANY'S ARGUMENTS:
4. 1. The Company is facing extreme pressures in the market place. The need for change and an improvement in efficiency and cost-effectiveness is crucial.
2. It is essential, in order to ensure the continued viability of the Company that the Company's proposals are put in place. These are the minimum changes to indicate to the German Parent Group that the workforce in Carrick on Shannon are serious about protecting their jobs.
3. The plant is the poorest performing one in the Group. Cost must be reduced and productivity increased. The Group has at its disposal plants in a number of far eastern countries who can supply the components at competitive prices and good quality. The Carrick on Shannon plant is loss making. This cannot be sustained.
4. If the workforce co-operates with the three essential conditions as proposed by the Company, Management will do its utmost to agree with the Union realistic terms and conditions to be applied to multi-machine operations when the financial position permits.
RECOMMENDATION:
The Court has considered carefully the detailed written and oral submissions made by the parties.
At the outset the Court must declare its concern that the recommendation it made on the original case put to the Court in July, and accepted by both parties, has been overtaken by subsequent decisions by the Company to reconsider the future of the plant in Carrick-on-Shannon. It does not seem reasonable that these subsequent concerns of the Company, some three months later, should not have been clarified at the time of the original hearing. The Court does realise, on the other hand, that the Union/workforce could have chosen to co-operate with management's proposals on multi-machine operation without prejudice in the short-term, in line with the original Labour Court recommendation, to reduce the risk to the ongoing business.
It is accepted the Company is presently incurring serious losses under its existing performance levels. At this stage it is clear that the Court is faced with the decision of the parent company to close the Carrick-on-Shannon operation if it cannot see a willingness on the part of its workforce to change to work methods more in line with its other plants. The Company requires an increase in performance so as to create a belief in its future viability. The Court is aware that this loss of faith by the Company stems in particular from the failure of negotiations to have multi-machine operation, as operated in all of the Company's other plants, introduced in Carrick-on-Shannon. The Court is also aware that the workforce perceives serious difficulties in working with the attitudes of the present management.
In taking all aspects of the present problems into account, together with both Management and Union positions, and with the aim of recommending a solution which should ensure a viable future for the plant, the Court recommends as below:
1: The machine operatives accept immediately the principle of multi-machine operation, to the extent that the time cycles of the particular work allows.
2: The peeling and checking operations be accepted as part of the job, again to the extent that the process time for the particular work will permit. Individuals carrying extra payments presently for this work should have these rates preserved for a period, pending later assessment.
3: That both the above operations where practicable be performed in a team working approach, as seen in the Spanish plant, as proposed by the Union and workforce. The Court would see this as a major plank to future co-operation and development in the plant.
4: That management accept the proposal of the workforce to keep the machines in operation during the two breaks, by staggering their break periods.
5: That the above methods of operation be monitored by a Joint Working Group, in conjunction with the Labour Relations Commission Advisory Service, to iron out any problems that may arise.
6: On the acceptance and implementation of the above recommendations the Company to agree to pay to each person directly involved in the change the sum of £400.
7: Additionally subject to acceptance and implementation of this recommendation that an extra days holiday as proposed should be available to each person.
8: The Union has stated that a number of individuals may seek voluntary redundancy rather than continue on the new work methods. In as much as the Company can accommodate redundancies resulting from implementation of the new methods, allowing the right to refuse where skill retention needs or such so dictate, then the Court recommends that a phased voluntary redundancy scheme be accepted. Redundancy payments should be calculated at three weeks per year of service plus statutory.
9: That the situation be reviewed by both parties on the anniversary date of the implementation of the recommendation. The review to take account of all aspects of the operation including improvement in profitability and the benefits to accrue to the employees.
Finally, the Court urges both parties to set aside past difficulties, and in a spirit of joint endeavour to implement the proposals immediately. It is essential that the Irish operation be seen to be determined to make a success of their plant, and do everything possible to work together to achieve this. The Court has been advised that the Company is in the course of appointing a new Irish manager if agreement is reached, and considers that this would be an opportunity to rekindle trust and put its industrial relations on a more satisfactory footing.
Signed on behalf of the Labour Court
Tom McGrath
10th November, 1997______________________
T.O'D./D.T.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Tom O'Dea, Court Secretary.