FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : BPB GYPSUM INDUSTRIES - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Mr McHenry Worker Member: Ms Ni Mhurchu |
1. Dispute concerning the Company's development plan.
BACKGROUND:
2. The Company which is part of the BPB Group first introduced its development plan in February, 1997. The plan proposes a comprehensive re-organisation of the plant and includes a number of redundancies, the introduction of World Class Manufacturing and Continuous Improvement Programme, the introduction of annualised hours and substantial investment over the next few years to facilitate a more efficient operation. While agreement has been reached on a number of issues including the number of voluntary redundancies the parties reached no agreement on the remuneration package for general operative and clerical staff, service pay, compassionate leave, the 2% local bargaining increase under Partnership 2000, and improvement in the general operative pension scheme. The dispute was referred to the Labour Relations Commission and conciliation conferences were held in November, December, 1997 and January, February, 1998. Agreement was not reached and the dispute was referred to the Labour Court by the Labour Relations Commission on the 4th of March, 1998. A Court hearing was held on the 1st of April, 1998. The hearing was adjourned in order to allow the parties have further negotiations on some issues which the Court felt were not sufficiently addressed in previous discussions. Despite intensive negotiations none of the outstanding matters have actually been resolved. While some progress was made towards understanding the various issues relating to annualised hours, bonus and related matters it was not possible to actually agree a formula on any of those issues. Further Court hearings took place on the 8th and 11th of May, 1998.
UNION'S ARGUMENTS:
3. 1. The Company's offers in relation to wages in the context of annualised hours have fallen well short of the Union's claims and are substantially less than those proposed at conciliation. The Company has also insisted on varying the reserved and rostered hours with each proposal. If wage rates were high enough, the Union could recommend the annualised hours proposed, around which the Company expects to build the wage structure. Rather than argue about bonus rates, variable pay standards etc., bonus should be eliminated from the wage structure altogether. The bonus specified in each wage proposal is in fact a maximum earning potential. It is not known how low the bonus may fall. The Union is prepared to recommend to its members to operate to the highest possible standards (subject to Health and Safety considerations) and that the lines will be operated to optimum speeds.
2. The Company's latest proposals for production operatives range from £19,609 to £25,582. However, only two members will enjoy the higher rate. The next highest rate for the bulk of shift workers would be £24,786 substantially less than the Union's claim for £27,000 for day workers, £29,000 for three shift and lorry drivers and £24,000 for clerical staff.
3. The improvement sought in the general operatives' pension scheme is claimed by workers represented by all the Unions at the plant. The workers seek a de-integrated scheme. Under the Company's proposal the revised pension based on a salary of £19,069 would be £10,600. The Union's proposal (details supplied to the Court) would yield a pension of £13,312 based on the same salary. The savings generated from implementation of the Company Development Plan would provide adequate funding for the de-integrated pension scheme costs.
4. The Union seeks an improvement in service pay and the addition of three additional increments. The workers' expectation is for a 10% increase in existing service pay rates plus three new increments bringing the top point to 38 years.
5. The Company has extended Bereavement Leave, to include some indirect family, to three days' paid leave. The Union seeks the inclusion of Aunts and Uncles in the arrangement.
6. The Union has put forward a comprehensive proposal on Profit/Gainsharing but Management still refuses to address the claim. If the Company does not do so the Union intends to lodge a separate claim in the context of 'Clause 9' of Partnership 2000.
7. The Company's best offer in respect of clerical workers does not represent an attractive proposition for the majority of clerical workers. They expect an increase in salaries to reflect their co-operation with the Company Development Plan.
8. Workers have afforded concessions on jobs in every grade and department together with the acceptance of additional duties and efficiencies. Workers have also accepted the concept of team working within departments which may lead to self autonomous groups within departments as well as co-operation with continuous improvement. The Union expects that the Company's pay offer, inclusive of service pay, will be substantially increased in recognition of the positive approach adopted by workers.
COMPANY'S ARGUMENTS:
4. 1. The Company has made a positive response to all the disputed issues upon which the Court advised the parties to have further discussions. However, this has not been reciprocated by the Union. The Company has made significant movements on pay and its offers of the 1st of April, 1998 have been increased throughout all departments (details supplied to the Court). The Union has not moved from its original claim for pay levels of £29,000, £28,000 and £27,000. No breakdown of the component elements has been provided at any stage by the Union to enable a comparison with any of the pay data presented by the Company during the course of resumed negotiations.
2. Pension: The Company is in compliance with paragraph 4 of the Pay and Conditions of Employment Agreement under Partnership 2000. Therefore, the Company offer to effectively reduce current integration with the State pension scheme by 1/3 is solely made in the context of negotiations on the Company Development Plan. If the Union wishes to accept the Scheme as it stands, without adjustment, the Company is prepared to increase the direct payment element by an amount equivalent to the cost of proposed pension adjustment which would be then withdrawn. Apart from de-integration of the pension scheme, the Union is also seeking to change the contribution ratio from the proportions which have been agreed with unions on the establishment of the Scheme. Concession of this claim would bring the overall cost to the Company to 2.9%, which would have to be offset against any new pay arrangements, thus diminishing other elements.
3. Service Pay: The Company offers a 5% increase to existing bands with a possible extension of bands.
4. Bereavement Leave: The extension of three days compassionate leave to cover father-in-law, mother-in-law, son-in-law, daughter-in-law, grandparent, grandchild, and non-relative living at home as a family member.
5. Gainsharing and The Union has raised Gainsharing and Profit Sharing
Profitsharing: within the context of Chapter 9 of Partnership 2000. The Company Development Plan put forward by Gypsum Industries is fully compatible with the terms of Chapter 9. The Company is seeking £10 million of capital investments to allow it and its employees compete in a global economy. It has engaged in exhaustive consultation, offering pay terms above those of competitors' plants and inviting financial involvement through a tax efficient share participation plan. Gypsum Industries has an established gainsharing/bonus system in place based on work group performance, which would be continued under the proposed agreement.
6. Bonus/Gainsharing: The Company currently has approximately a dozen Bonus Schemes with different hourly earnings levels, which have been incorporated into the pay proposals in a manner which goes some way towards the objective of harmonising these arrangements.
7. Clerical Grades: The Company is satisfied that its current pay scales are competitive with those of similar workers in good employments in the private and public sectors. The Company has proposed substituting a performance related payment of £1,000 as an alternative to the recommendation by the Labour Court in LCR15625. It has also proposed the introduction of a system of allowance payments for clerical staff on the attainment of recognised Certificates, Diplomas, and Degrees from accredited bodies, i.e.,
Certificate £250 per annum
Diploma £500 per annum
Degree £750 per annum
with assistance being provided towards course and examination fees.
RECOMMENDATION:
The Court has carefully evaluated the submissions made by the parties to this dispute in the course of both hearings. It is noted that there is general agreement on the thrust of the Company's proposals for the introduction of annualised hours employment contracts. There is, however, considerable disagreement as to the terms on which the proposed new arrangements are to be introduced.
The Court is of the view that the arrangements proposed are necessary to ensure that the company remains competitive in its Irish operation and that it obtains the necessary investment so as to retain the viability of its Cavan plant. While the Company's proposals may lead to a reduction in the overall level of earnings of employees in terms of their pay from overtime, this would, in any event, occur in consequence of the provisions of the Organisation of Working Time Act 1997, as current levels of overtime working exceed maximum working hours permissible by the legislation.
The Court is satisfied that in their present form the company's proposals should ensure that there is no diminution in pay in respect of time actually worked. Rather, pay per hours worked should improve appreciably since it is anticipated that a requirement to work all of the reserve hours provided should only arise exceptionally.
Nonetheless, the Court believes that some further improvement on the Company's final offer on pay and other conditions is warranted.
The Court, therefore, recommends as follows;
Composite Pay Rates
It is noted that at conciliation the IRO put forward proposals on composite pay rates which are reproduced in the following table. Except in the case of Transport Drivers-Finished Goods, the Court recommends that those proposals should be accepted subject to a further increase of 1% on the implementation of the recommendation and a further 1% after the Company Development Plan has been successfully in operation for a period of three months. The rates shown are exclusive of the cost of pension adjustment recommended below, but do include bonus and service pay. The allocation of the increase provided over the Company's final offer, as between those two components of the overall figure is a matter which should be agreed between the parties.
Composite Rates Recommended
| Category | Composite Rate Proposed by IRO | Rate Recommended 1st Phase | Rate Recommended 2nd Phase |
| 3 Shift Working |  | | |
| Board Plant | £25,500 | £25,755 | £26,013 |
| Grinding /Calcining | £25,500 | £25,755 | £26,013 |
| Shovel Driver | £25,000 | £25,250 | £25,502 |
| | | |
| 2 Shift Working | | | |
| Loading | £22,000 | £22,220 | £22,442 |
| Day Working | | | |
| Knocknacran | £24,000 | £24,240 | £24,482 |
| Board Plant | £22,000 | £22,220 | £22,442 |
| Mixing/Bagging | £24,000 | £24,240 | £24,482 |
| Engineering | £24,000 | £24,240 | £24,482 |
| Artex/D.I.Y. | £24,000 | £24,240 | £24,482 |
| Warehouse | £24,500 | £24,745 | £24,992 |
| | | |
| Transport | | | |
| Rocks | £24,000 | £24,240 | £24,482 |
Four Shift Working
The Court notes that it is intended to introduce four shift working as is provided for in the Company/Union Agreement. In that event the composite rates proposed by the Company in respect of this shift pattern should be increased pro-rata to the increase proposed for three shift working.
Transport Drivers/Finished Goods
It is noted that the current proposals on annualised hours do not apply to Transport Drivers/Finished Goods. Given the nature of their work it is unlikely that any such system could be applied in their case. Uniquely, they will be required to continue working the same hours as at present and will not be subject to the same statutory restrictions as other employees.
On that account the Court recommends that they be excluded from the scope of the present proposals on new pay structures.
It is, however, accepted that the continuation of an in-house transport fleet is dependent on significant reductions in the cost of maintaining that service. But this is a matter which should be dealt with separately from the other issues now before the Court.
The parties should immediately address the issue of achieving the cost reductions necessary to maintain an in-house transport fleet as a viable option. Should the parties fail to agree arrangements within 2 months, this aspect of the dispute may be referred back to the Court.
Clerical Staff
The Staff Efficiency award to clerical staff should be increased to £1,000 per annum. The Company's proposals on allowances on the attainment of recognised qualifications should be accepted.
Pensions
The Court recommends that one times state pension be deducted from pensionable remuneration rather than I.5 times state pension. The Court does not recommend any change in the current contribution ratio and the cost of this modification should be borne by the company and employees within that ratio.
Annualised Hours
As observed above the proposals on annualised hours are put forward on the basis that there should only be an exceptional requirement to work the full amount of reserved hours provided for. It is the Court's view that if this transpires not to be the case, the system will require fundamental review. In that regard the Court recommends that the parties establish joint monitoring arrangements so as to ensure that the system operates as intended.
It is further recommended that the annual reserved hours be allocated on a quarterly basis and that the hours not used in each quarter should decay and be non-transferable to the next quarter.
Reference Periods for Calculation of Compensation
The reference periods for calculation of compensation, as offered by the Company, should be as proposed by the IRO (i.e. April 1995 to March 1997 and August 1996 to July 1997.
Line Speeds
In line with the requirements of the Company Development Plan all plant, including the Board Plant should be operated to its optimum capacity.
Other Issues
All other aspects of the Company Development should be implemented in the terms proposed by the Company.
Signed on behalf of the Labour Court
Kevin Duffy
27th May, 1998______________________
T.O'D./D.T.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Tom O'Dea, Court Secretary.