FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : SERVISAIR LIMITED (REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Flood Employer Member: Mr Pierce Worker Member: Mr Rorke |
1. (A) Interpretation of agreement in respect of 39 hour week
BACKGROUND:
2. The dispute concerns the interpretation of an agreement between the parties on the 39-hour week. The Company is involved in the passenger and freight business at the main Irish airports. It employs approximately 250 workers.
The Company operates a 40-hour week. Section 6(1) of the Company/Union agreement states as follows:
"the normal working week for the industrial workers will be 40 hours inclusive of paid meal breaks. The flexible shift patterns will provide an average 40 hour week over the shift cycle. The hourly rate for the industrial workers will be calculated on the basis of a 39 hour divisor". (Appendix 1).
Overtime will be paid at time plus one half for hours worked in excess of 40 hours per week.
The Union has interpreted the agreement as being that a worker would be paid 40 times the hourly rate for a normal working week. The Company's interpretation is that it is 39 times the hourly rate. For a number of weeks after the agreement, workers were paid 40 times the hourly rate. The Company claims that this was a clerical error and changed payment to 39 times the hourly rate. This became the practice from the 1st of May, 1997.
A letter from the Company to the Union, dated 27th of March, 1997, which referred to the agreement was balloted on and accepted by the workers. Pay scales set out in the letter were in hourly rates.
The dispute was referred to the Labour Relations Commission and a conciliation conference took place on the 2nd of September, 1997. As the parties did not reach agreement, the dispute was referred to the Labour Court on the 23rd of October, 1997, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 6th of January, 1998.
UNION'S ARGUMENTS:
3. 1. The agreement in March, 1997, provided that a 39 hour divisor would be used and, accordingly, payment for the 40th hour would be at a flat rate. During negotiations between the parties, hourly rate figures were used. Following agreement, the workers concerned received 40 times the hourly rate as basic weekly pay. This arrangement was then changed unilaterally by the Company to 39 times the hourly rate. Temporary staff who work a 40-hour week are paid 40 times the hourly rate. The Company is basically deducting 1 hour's pay per week from each worker. The workers accept that the 40th hour does not attract overtime rates but they should be paid it at a flat rate.
COMPANY'S ARGUMENTS:
4. 1. Both parties agreed that the hourly rate would be calculated on the basis of a 39 hour divisor. If the divisor is 39 it follows that the multiplier must also be 39 for a weekly wage. The Company never said that payment for the 40th hour would be flat time. The Company regrets the clerical error which resulted in workers receiving 40 times the hourly rate for a number of weeks, but explained the error to the Union. It was the Union which first asked for the 39 hour divisor. Part-time workers are paid a unique wage. It is not envisaged that they would work 40 hours per week, so the issue of paying them 40 times the hourly rate does not arise.
RECOMMENDATION:
The Court is asked to interpret a section of a comprehensive agreement entered into by the parties, with the assistance of a mediator, appointed by the Labour Relations Commission.
The Court was surprised that the parties had not reconvened with the mediator to seek his clarification of this disputed section, as he obviously is thoroughly familiar with the discussions that took place at the time of negotiation of the agreement.
While the Court can obviously make a Recommendation of which application of the divisor is more appropriate, it is difficult for a third party not at the negotiations to decide what was intended at the time.
The Court, therefore, recommends that the parties reconvene with the mediator to seek his interpretation of the agreement.
If it emerges that this issue was not dealt with clearly at the time of agreement, then the parties should try to reach an agreement on this issue. If the parties fail to reach a conclusion, the Court will make a definitive Recommendation on which is the more appropriate application of a divisor.
Signed on behalf of the Labour Court
Finbarr Flood
21st January, 1998______________________
C.O'N./S.G.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Ciaran O'Neill, Court Secretary.