FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : PFIZER PHARMACEUTICAL (REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Ms Owens Employer Member: Mr Keogh Worker Member: Mr O'Neill |
1. Partnership 2000 (P2000).
BACKGROUND:
2. The Company is based at Ringaskiddy, Co. Cork and manufactures bulk pharmaceuticals which are exported to over 30 Pfizer formulation plants abroad. The Company employs a workforce of 310. The dispute concerns the terms for a revised Company/Union agreement under P2000, in respect of approximately 110 general and process operators, to cover the period from the 1st of January, 1997 to the 31st of March, 2000. The Union is seeking a range of concessions from the Company, including a pay increase of approximately 25%, improvements to a number of employee benefits including sick-pay, pension, annual leave, VHI Scheme, and a lump-sum package on retirement. The Union is also seeking the introduction of a gain-sharing or profit-sharing scheme, under Chapter 9, Clause 15 of P2000. The dispute was the subject of local discussions and conciliation conferences under the auspices of the Labour Relations Commission arising from which the Company made a final offer, on the 13th of November, 1997, of a pay increase of 15.1% cumulative, including a 1% increase from the calendar month following final agreement, extension to sick-pay entitlements, improvements in the VHI scheme, lump-sum on retirement equivalent to 2 years' cost of VHI, additional annual leave (details of above supplied to the Court), in return for work improvements aimed at improving efficiency and flexibility, relating to 'OSP1' manning and 'hydrogenation of OSP2 products'.
The Union rejected the Company offer and the dispute was referred to the Labour Court, on the 20th of January, 1998, in accordance with Section 26(1) of the Industrial Relations Act, 1990. The Court carried out its investigation, in Cork, on the 1st of April, 1998.
3. 1. The Company is seeking to conclude an agreement which takes into account fully the Company's business context, functional flexibility and co-operation and has regard to the competitive needs of the business, taking account of the impact of wage increases on costs, and which provides for essential improvements in working arrangements.
2. There is an onus on all staff at the Ringaskiddy plant to protect the business and secure the future viability of operations. The plant must remain competitive and cost-efficient in the face of competition from other Pfizer facilities abroad.
3. The existing employment package of benefits and remuneration and the significant level of improvement are fair and reasonable and compare favourably with practice elsewhere.
4. The proposed work-improvements are reasonable and practicable and the level of work-content which will result will be fair, will be implemented in a sensible manner and will be within the capacity and competence of those affected.
5. The profit-sharing or gain-sharing arrangements being sought by the Union are neither reasonable nor realistic. The existing Employee Share Ownership Scheme already gives the staff a stake in the business. The Union's claim in this regard is not valid under the terms of P2000.
UNION'S ARGUMENTS:
4. 1. The Company's final offer has been rejected on the grounds that only either a gain-share or profit-sharing scheme would reflect the workers' real commitment at local level.
2. Chapter 9 of P2000 is the preferred mechanism of the Union side to secure a local plant agreement, based on the premise that the plant is extremely successful, in line with the spirit and intention of the social partners to extend the partnership concept to the level of the local enterprise.
3. The current share ownership scheme does not sufficiently reflect the workers' involvement within the Company. Additionally, the workers have no direct influence on the share price and a reward system such as proposed by the Union would be more in keeping with the spirit of P2000.
4. A gain-share or profit share scheme would offer real partnership and secure commitment to competitiveness and flexibility within the plant.
5. The Company has stated that "Employees at Ringaskiddy have made an excellent contribution to these successes and can take pride in their achievements". The overall success of the Company to date and the plan for the years ahead are not adequately reflected in the remuneration packages proposed by the Company.
6. Given the difficulties experienced in relation to change in the recent past, a framework agreement along the lines of that proposed by the Union, would be an ideal vehicle for the resolution of a potentially damaging dispute at local level. Involving the workforce is essential to the introduction of change in a non-confrontational fashion. However, this must involve the success being shared by all concerned.
7. Many successful companies have engaged in partnership agreements to good effect. Under P2000, a National Centre for Partnership is helping to promote the development of employee involvement in partnership, providing technical support and training and facilitating local arrangements. Thus it would be appropriate for this Company to adopt a positive attitude to the Union's proposals.
RECOMMENDATION:
The main issue in this dispute before the Court arises from interpretation of Chapter 9 of Partnership 2000.
Whilst both parties have a commitment to develop partnership and equal opportunities the Union see this as a mechanism for developing a profit-share / gain-share system of rewarding the employees. The Company has put a package together which includes monetary terms considerably in excess of the terms of Partnership 2000 and points out that the reward system sought by the Union does not form part of Partnership 2000.
In all the circumstances, the Court recommends that (a) the Union accept the Company's proposals of 13th November, 1997, (b) the Company agree to set up a Joint Working Party aimed at developing partnership in the workplace as outlined in Chapter 9 (definition and objectives), (c) on acceptance of the above the Company agree to increase the monetary terms of their offer by a further 1% from the beginning of calendar month following final written agreement (i.e., increase from 1% to 2%).
Signed on behalf of the Labour Court
Evelyn Owens
27th April, 1998______________________
M.K./S.G.Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Michael Keegan, Court Secretary.