LCR16263

FULL RECOMMENDATION CD/99/374 RECOMMENDATIONNO.LCR16263 (CC95/1522) INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : BUS EIREANN - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION NATIONAL BUS AND RAIL UNION DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Pierce Worker Member: Mr Rorke

SUBJECT:
1. Company viability plan.


BACKGROUND:

2. The dispute concerns the Company's proposal contained in the "Drivers' Change Programme", which was issued to the Unions in May, 1999. Some of the issues involved in the Programme were issues which the Labour Court dealt with in the past in Recommendations LCR 14708 and 15387. The parties were urged to enter into negotiations on productivity. A large number of direct meetings, and conciliation conferences with the Labour Relations Commission (LRC) took place but there are still many issues in dispute. The main item that is of concern to the Unions is an improvement in basic pay. The Company is offering a basic pay of £280 at the top of the scale i.e. after 5 years. The Unions are seeking a top rate of £330. Another issue the Unions are concerned about is the use of private operators. They feel that a penalty should be imposed on the Company if there is an abuse of any agreement on this issue between the parties. The following is a brief description of the issues proposed in the Programme:

(a)Work Coverage (Boards)

Normal practice is to have regular work included in drivers' boards, with irregular work being covered either by spare staff or by boarded drivers on overtime. It was decided that all work would be pre-planned under 3 main categories, i.e:

Boarded work (minimum 85% driving time) (Category 1)

Unboarded work to be covered by own resources
involving overtime & rest day working (Category 2)

Work which cannot be covered by own resources
to be subcontracted to private operators (Category 3)

The boarding of work exercises was carried out on 3 occassions - in June, 1996, the Company prepared revised boards for all depots. The Unions found aspects of these unacceptable. In April - November, 1997, the Unions undertook to prepare boards and indicated that they could achieve savings of £2 million. In December, 1997 - May, 1998, Coopers and Lybrand conducted an evaluation on both sets of boards. Their report showed that the Company's plan achieved savings of £1.95 million, and the Union's plan increased costs by £0.6 million.

In June - November, 1998, it was agreed in local talks to initiate a new joint workplan. This joint coverage plan, along wiyh the proposed changes in certain work practices and conditions formed the basis on which the Company's revised consolidated pay rate proposals were calculated and compiled. In so far as the Company is concerned, these final boards are not ideal but have been accepted in the spirit of compromise which was needed to finalise the workplan. To meet alterations in business and service requirements boards will be subject to on-going review.

• (b) Working Arrangements For Spare Drivers

  The panel of spare drivers at each depot is to provide relief for boarded drivers on annual leave, illness and so forth. They have also operated services and regular auxiliaries on an ad-hoc basis. These will now be expected to be fully flexible in relation to hours, place of attendance and break times. They will also be expected to work overtime when necessary.
  
  (c) Staffing Arrangements

  Temporary drivers will be recruited where necessary to cover holidays, absenteeism and short-term services/contracts, rather than just in the "summer" season which operates at present.
  
  (d) Fleet

  At present there are 28 vehicles on service with very low utilisation i.e. less than 4 hours per day. It is intended to contract-out this work, and thereby reduce fleet holdings.
  
  (e) Contractors

  Contractors, when working for the Company will now be fully integrated into operations and will have access to all Company premises. Sub-contractors will only be hired when the Company's own resources are fully used.
  
  (f) Marginal Times

  This is paid time afforded to drivers in respect of reporting for duty, checking buses prior to departing depot, travel time to terminus and booking passengers. A new standard marginal time of 20 minutes per day is proposed.
  
  (g) Other Work

  Drivers on paid time with no driving duties will be required to undertake other road passenger work i.e. issuing tickets, checking passengers, luggage and parcel attendance.
  
  (h) Technology

  The ticketing systems need to be modernised and equipment replaced. An on-bus radio and telephone communication system will be installed.
  

  (i) City Services

  (i) Introduction of Minibuses
  
  The Company provides bus services in the cities of Cork, Limerick, Galway and Waterford, and there is an obligation to extend the services to new areas. Twenty-five minibuses were acquired in 1997 at a cost of £2 million but to date only 3 vehicles are being operated in Waterford. A proposal for a uniform rate of pay for all drivers is now proposed.
  
  
  (ii) Other Changes
  
  The present situation for city services is
  

  • payment per week - 39 hours;
    
  • maximum average weekly scheduled - 38 hours 10 minutes;
    
  • actual average weekly - ranges from 32 hours to
  38 hours 10 minutes.
  
  It is proposed that existing drivers should retain the benefits of the 38 hours 10 minutes schedule, and the 39 hours would only apply to new entrants.
  
  (j)Drivers' Hours Regulations

  A new 5 day basic week for all drivers is proposed which will enable the Company to meet all legislative requirements, including EU regulations. In recent times, an independent expert was engaged to assist both parties in dealing with any disputed interpretations.
  
  (k) Drivers' Earnings

  Serious concern has been expressed that drivers' earnings will be adversely affected, based on the possible effects of a 5 day week, drivers' hours regulation and sub-contracting. All of the above are essential and are not intended to reduce earnings. Overtime working will still be on offer.
  
  (l) Break Periods

  It is inevitable that there can be prolonged breaks for drivers between trips. It is proposed to minimise these breaks, having regard for service requirements. There will be a maximum of 2 breaks per day which will not exceed 4 hours per day or a total of 16 hours per 5 day week.
  
  (m) Shift & Rota Allowances

  For many years, a shift allowance of 1/6th of basic rate has been afforded to drivers when working either alternating or rotating turns of duty. Current practice is that this allowance is paid even where there is little difference between starting times or a week-about basis. It is proposed that drivers will, in future, qualify for the shift allowance when;
  

  • • on the spare panel;
      
    • permanently marked in on a city service;
      
    • marked in on a board and rotating/alternating with a difference of four or more hours in starting times compared to the previous week on a least three days in the qualifying week.
    • 
      Drivers on alternating/rotating turns of duty, who do not qualify for payment of the shift allowance in any week, will be afforded a new rota allowance of 1/12th basic rate in respect of that week.
      
      The rotation of duties formed one of the central themes in the new workplan. Of the proposed 939 drivers, 500 will qualify for the shift allowance, 200 will qualify for the rota allowance and 239 will be on static duty.
      
      

(n) Premium Rates/Additional Payments

The proposed overtime premium rates to be set on a higher weekly/hourly rate than previously. Premia will now be Sunday work double time, public holidays will be at double time plus statutory entitlements, and time plus one half for other hours worked outside of standard hours.


(o) Rates Of Pay

The objective is to replace the existing arrangements with a consolidated weekly scale which would simplfy matters and enhance pension entitlements. (Full details of the proposed uniform pay scales were supplied to the Court.) The new consolidated basic rate is inclusive of the 3% local bargaining clause of the PESP and the 2% local bargaining increase contained in Partnership 2000. It is also proposed that a lead-in sum of £1,400 gross will be given to all drivers who qualify for placement on year 5 of the pay scale in return for acceptance of the Change Programme and its smooth implementation.

(p) Training

An extensive training programme will be provided by the Company, including courses on new ticketing and cash deposit system, road traffic regulations, drivers' hours regulations and communication equipment.

(q) New & Revised Industrial Relation Procedures:Time Table Changes

A joint working party under an agreed chairperson was set-up in September, 1997 to agree revised procedures covering grievance and discipline negotiations and dispute resolution, and a scheme for the establishment of enterprise partnership. The Framework for Negotiations and Dispute Resolution includes a provision to implement service timetable and related changes to meet customer and business requirements.

In late March, 1997, the Unions put the Company proposals to ballot, with a resultant rejection by over 95% of the combined membership. The Unions, however, claim that they are prepared to endorse change, but only if the terms and conditions are reasonable.

The dispute was referred to the Labour Court on the 12th of July, 1999, in accordance with Section 26 (1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 19th of August, 1999.


UNIONS' ARGUMENTS:

3. 1. The major issue in dispute is the basic rate of pay. Based on the earnings for drivers in 1997, the Company's offer, exclusive of the 3% PESP and 2% Partnership 2000, is an average of £7 per week increase in return for the demand in the Drivers' Change Programme. Drivers can no longer be expected to subvent the Company by accepting low wages.

2. There is a huge turnover in staff because of the low rate of pay. The basic starting rate is £185 per week. The incremental scale should be 3 years - years 1 and 2 should be dropped.

3. A major problem for the Company is the lack of subvention by successive governments, and also the prohibition by the governments to raise fares like other commercial companies.


COMPANY'S ARGUMENTS:

4. 1. The Company's proposals are necessary if it is to remain viable. The Unions agree that the changes are necessary. There is an ever-growing number of bus companies in competition with Bus Eireann.

2. The Company has made every effort since 1992 to negotiate with the Unions on the introduction for change, but with very little progress.

3. The Company was disappointed that, after substantial progress had been made following many meetings, both Unions recommended rejection of the Company's offer, and suggested that major improvements would be sought. The Company does not have any additional funds available. This position was made clear to the Unions' at negotiations.

4. There are numerous positive features for the drivers contained in the proposals (details supplied to the Court). The basic rate of pay has increased to £280 per week with the inclusion of the various allowances. This level of basic pay can only be sustained if the conditions as proposed are accepted.







RECOMMENDATION:

The Court has given very serious consideration to the written and oral submissions of both parties. The Court understands the urgent need to make changes in this Company in order to meet the competitive pressures it is facing, to ensure compliance with EU and other road transport regulations, and to meet the necessary technological and other challenges facing it. The Court recognises the benefit of having an agreed workplan in which there is less ad-hoc allocation of work, and which is appropriate to the challenges facing the Company now and in the future.

The Unions agree with the need for change, and have indicated their willingness to accept change. While such change is acceptable to their members, they stressed that it must be coupled with an improvement in the rate of pay for drivers, and that such an improvement is necessary to address the low basic rates. Similarly, the Union indicated to the Court that they welcomed competition and accepted that changes were inevitable as a result.

The Company prepared a programme of change which it set out in a booklet entitled "Driver's Change Programme - The Way Ahead".

The Court recommends that the "Driver's Change Programme" should be accepted with certain amendments as specified below. The Court is clearly of the understanding that these amendments are being recommendedconditionalon overall acceptance and commitment to the change programme.

In return for these recommended improvements, which will significantly improve future pension benefits and the base rate for calculating shift and overtime payments, the Court recommends that theBoardsi.e. the workplans, as put forward by the Company should be accepted by the Unions, except in those few cases mentioned to the Court, where there could be serious distortions affecting certain drivers. Such cases should be discussed between the parties and agreed upon within six weeks.

In the event of difficulties arising in these cases, they may be referred back to the Court.

• New Basic Pay Scale
  The Court recommends that the Company's offer to replace the current fixed rate of £185.91 - £187.48 per week with a new consolidated basic pay scale for all drivers (cities, provincial and minibus), should be amended as follows:
  Year 1 Year 2 Year 3 Year4 Year 5
  £240 £255 £270 £285 £300
  
  These rates should apply from the date of acceptance of this recommendation. This new rate to include the 3% local bargaining clause of PESP, and 2% local bargaining increase contained in Partnership 2000. The new basic rate of pay should be reflected in the pension scheme with effect from the operation of the new rates.
  
  
  
• Lead In Payment
  The Company's offer of a lead in payment of £1,400 should be increased to £1,700 for the smooth implementation of the programme.
  
• Overtime Payments
  In the context of the new pay scale recommended above, the base rate for overtime calculation will be substantially increased and, therefore, the Court considers the new premia as proposed by the Company as reasonable. The Court recommends acceptance of these new overtime premia.
  
• Shift Allowance/Rota Allowance
  The Court recommends acceptance of the Company's proposal on shift and rota allowances with the proviso that, following one year after implementation, any driver who suffers loss of earnings as a direct result of this proposal, should be compensated.

• Waiting Time and Spreadover Allowances
  The Court accepts the principle of absorbing the waiting time and spreadover allowances into the new pay scales for all drivers, as a fair and reasonable way of dealing with these allowances. The Court recommends acceptance of this position.
  
• Scheduled Time for Drivers
  The scheduled time of 39 hours should apply to new entrants.
  
• Outbased Operations
  The Unions should accept the Company's proposals on outbased operations, and the Company should increase the compensation formula to twice the annual loss of earnings with no ceiling (the amount not to exceed future loss to date of retirement). This formula forms part of this overall package and, therefore, should not be treated as a precedent in any future loss of earnings claim.
  
• Equalisation Payment
  The Company's offer to either continue the equalisation payment for those currently receiving it or, alternatively, to buy it out is reasonable.
  
• Marginal Times
  The inclusion of travel and passenger times in the new boards, and the standardisation of the remaining marginal times to 20 minutes should be accepted.

• Breaks
  The Court recommends that the break allowance between trips should be subject to a maximum of three hours per day, with a maximum of 15 hours per week.
  
  
  
• Use of Private Operators
  The guarantees given by the Company on the use of private operators should be accepted with the provisio that the Tribunal, set up to oversee the implementation of the ongoing operation of new working arrangements, should have the power to implement a penalty where there is clear abuse of these guarantees. The amount of the penalty, up to an agreed maximum figure, should be decided by the Tribunal and included in a fund in the depot affected, to be administered by the workers, whenever such an abuse takes place.
  
• Road Transport Regulations
  Compliance with both national and European road transport legislation and regulations is of vital importance to all companies covered by such obligations for the protection of both the employer and employees. In the event of an accident, the Company must be confident that it has complied with all rules and regulations. Insurance companies will be particularly strict about such compliance.
  
  The problem with this issue seems to be the interpretation of what constitutes anemergency. The Court is of the view that the necessity to finalise this matter should be treated as matter of urgency by the parties. Accordingly, the Court recommends that the parties must explore the possibility of obtaining a definitive ruling, and must also prepare for future regulations.
  
  The Court is prepared to facilitate this process if necessary.
  
• New and Revised Industrial Relations Procedures
  The Court considers that the new and revised industrial relations procedures should be generally acceptable, subject to any clarification necessary. The Court understands that the issue of theenterprise partnershipmay need to be developed further between the parties.
  
  Other Changes
  The Court notes that the Unions have indicated their acceptance to the following items subject to agreement on the total package:
  • co-operation with the introduction of the new technological changes put forward by the Company, e.g. the new ticketing system, an on-bus radio and telephonic communications system etc.;
  • co-operation with the extensive training programme on the new ticketing system, road transport traffic regulations, communications equipment and pre-service vehicle checks;
  • the introduction of minibuses with the pay rate as applies to "L Car" drivers;
  • scheduled time for city drivers;
  • the reduction of the fleet by 28 vehicles.
  
  
  
  
  
  
  Conclusion
  The Court urges the parties to accept the above recommendation as a sound and necessary way forward for the Company and its employees. The proposed changes should form the basis for a new era in industrial relations in this Company. The Court was encouraged by the positive attitude shown by the Unions towards the need to make changes. In the view of the Court, such an approach is very necessary to meet the challenges of the next millennium. A joint approach is needed, and this viability plan offers an opportunity to both sides.

Signed on behalf of the Labour Court



Caroline Jenkinson
10th September, 1999.______________________
CON/BCDeputy Chairman



NOTE

Enquiries concerning this Recommendation should be addressed to Ciaran O'Neill, Court Secretary.