FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : IRISH FERTILIZER INDUSTRIES - AND - MANUFACTURING, SCIENCE, FINANCE DIVISION : Chairman: Ms Owens Employer Member: Mr Keogh Worker Member: Mr Rorke |
1. Hearing arising from LCR 14710.
BACKGROUND:
2. The dispute before the Court concerns the Union's claim for the inclusion for pension purposes of a premium payment which the 5 workers concerned receive in respect of working nights, on-call and weekends as part of a cover agreement.
The workers are employed by the Company as instrument technicians. They are employed as day workers and also provide a cover system for the factory which involves working nights and weekends.
There are two categories of workers employed in the Company i.e. permanent shift workers and day workers. Shift workers are paid a shift premium of one-third of basic pay which is included as part of their annual salary for pension purposes.
The matter was the subject of a Labour Court investigation in early 1995 following which the Court issued LCR 14710 in which it recommended as follows:-
"Taking all aspects of the claim into account, and in particular the past history of the Company, the Court has concluded that to recommend concession of the Union's claim (which it considers to have merit) at this time would be contrary to Clause 4 of the P.C.W. which specifically refers to pensions and the capacity of an enterprise to absorb additional costs involved in improvement to Pension Schemes.
The Court further recommends that during the period from now to the expiration of the P.C.W. the parties should jointly address the financial implications to the Pension Scheme of any extension of benefits".
In February, 1996 the Company recognised shift payments made to craft employees who regularly work part-time shift patterns for the calculation of pension benefits. A proposal structured on a similar basis was rejected by the instrument technicians.
In the period 1996/1997 a number of meetings took place but progress could not be made. The Company argues that while the Union pursued its claim it has refused to meet the Company on the issue of annualised hours which the Company considers would be a means, both to supplement its proposal made in February, 1996 and to meet the workers aspirations in time as implied in LCR 14710.
As agreement could not be reached the dispute was referred back to the Labour Court by the Union on the 18th of August, 1997. A Labour Court hearing took place on the 9th of January, 1998.
UNION'S ARGUMENTS:
3. 1. The part-time shift system operated by the instrument technicians is regular, rostered and compulsory, and is a non variable emolument. The number of shifts are static and the frequency for the five technicians is 10.5 times for night working and call out and 10.5 times for weekend working, making a total of 21 for one year.
2. With reference to the 1991 Agreement the Company stated that the issue of pension was not raised at the time. The letter of February 1992 (copy furnished to the Court) clearly shows that this was not the case.
3. In its previous submission to the Court the Company made reference to the definition of annual salary for pension purposes "The Definition Specifically Excludes Variable Emoluments and Overtime". This argument is not valid as the technicians' cover rota system is non variable which carries a non variable emolument.
4. The Company argument that Saturday/Sunday work is paid at a premium rate and therefore should not be included for pension purposes is unacceptable. All shift work is paid at some kind of premium rate as the majority of the work is done outside normal hours i.e. weekends and nights.
5. The Company has agreed to include Sunday night working am call out for pension purposes but refused to include Sunday working. Both carry the same rate, are rostered and are non variable.
6. The Company includes part-time shift for pension purposes for craft workers in Cork and Arklow. The instrument technicians are the only group which have not been allowed full shift entitlement for pension purposes.
7. The Company is currently in a strong financial position, showing a substantial profit for 1996 and both pension funds are in a healthy state. In the circumstances the Union is seeking that the Court recommends that payments for Saturdays and Sundays are included for the calculation of salary for pension entitlements.
COMPANY'S ARGUMENTS:
4. 1. The Company has been engaged in negotiations at all its factories regarding the implementation of an annualised hours working system. This is seen by the Company as critical in its efforts to retain competitiveness in the face of increasingly difficult market conditions. It also provides a means by which the outstanding elements of the Union's claim could be addressed.
2. While the Union has pursued its claim, it has refused to meet the Company on the issue of annualised hours. Apart from the fact that the Company has yet to meet the instrument technicians on a matter central to the future of the Company, the Union has frustrated the Company's attempt to put forward a means both to supplement the proposal made in February 1996 and meet the instrument technicians' aspirations over time as implied in Labour Court Recommendation 14710.
3. The Company is prepared to acknowledge that the cover and on-call payments made for Monday to Friday nightwork are a shift premium and are therefore eligible for inclusion for pensionable pay. It is not prepared to include additional hours worked, paid for at overtime premium rates, into pension calculations. The Company is precluded from doing so by the rules of the Pension Scheme (details supplied).
4. Concession of the claim would secure for the workers concerned a level of benefits in excess of what is available for employees who work full-time on shift. It would lead to multiple claims by other groups seeking to have what they view as structured overtime incorporated into the calculation of pension benefits. This could cost the Company approximately £11 million if all groups secured incorporation of overtime into pensionable pay. This would jeopardise everything the Company has to do to secure its future.
5. The Company is seeking that the Court recommends that the offer made to the Union on the 15th of April 1997 meets the merits of the Union's claim and the original Court recommendation. This offer is based on including the additional payments for Monday to Friday night work and on-call in the calculation of pension benefits and agreement by the Union to negotiate an Annual Hours Agreement for the future. The Company believes its position is consistent with LCR15403 in which the Court was not sympathetic with the inclusion of systematic week-end overtime for some hospital employees. The Company's proposal would effectively meet 90% of the technicians' claim with a minimum risk of repercussions with other groups.
RECOMMENDATION:
Having considered the submissions from the parties and taking into account the negotiations that have taken place subsequent to LCR14710 the Court now recommends that:-
the Union accept the Management's offer of 15 April 1997 and that the parties commence negotiations immediately on the introduction of annualised hours to include the resolution of the outstanding issue of reckoning income for pension purposes.
Signed on behalf of the Labour Court
Evelyn Owens
22nd January, 1998______________________
F.B./S.G.Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Fran Brennan, Court Secretary.