FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 13(9), INDUSTRIAL RELATIONS ACT, 1969 PARTIES : TESCO IRELAND - AND - MANDATE DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Pierce Worker Member: Mr O'Neill |
1. Appeal of Rights Commissioner's Recommendation IR 1011/99/GF concerning claim for the inclusion of Sunday overtime in the calculation of holiday pay.
BACKGROUND:
2. The dispute concerns the Union's claim on behalf of a worker for the inclusion of Sunday overtime for the purposes of calculating holiday pay. It argues that the overtime is regular and rostered and that it is a well established practice in the retail industry to include regular and rostered overtime in the calculation of holiday pay. The Company rejects the claim. Its position is that no overtime, regular or irregular, other than that which is provided for in the Company/Union late-night agreement is included in pay for the purposes of calculating holiday pay. Local level discussions failed to resolve the matter and the dispute was referred to a Rights Commissioner for investigation and recommendation. The Rights Commissioner's findings and recommendation are as follows:-
"While I accept that the claimant suffers a considerable financial loss each time she takes annual leave, I cannot ignore the fact that holiday pay is calculated in accordance with the Organisation of Working Time Act, 1997.
Should there be an improvement in that situation, it must come as a direct result of a negotiated improvement between the parties.
I agree with the Company when it says that it would be inappropriate for a standard to be imposed on the Company which was not agreed by a collective agreement and on established law.
Therefore, I decide that this claim fails and I find in favour of the Company."
The Rights Commissioner's recommendation was appealed by the Union to the Labour Court on the 15th of May, 2000 under Section 13(9) of the Industrial Relations Act, 1969. The Labour Court heard the appeal on the 30th of June, 2000.
UNION'S ARGUMENTS:
3. 1. The worker has worked overtime on every Sunday since March, 1996 and in that respect is unique within the Tesco operation, given that the overwhelming majority of staff are now contracted to work Sundays as per the Company/Union agreement of 1996 and are paid the relevant premium in the calculation of holiday pay.
2. The Company only includes the worker's late-night overtime earnings in the calculation of holiday pay and excludes her Sunday overtime earnings. She is entitled to 22 days annual leave and this method of calculation results in a significant loss of holiday pay.
3. The Union disputes the Company's statement to the Rights Commissioner that "no other overtime regular or irregular is paid in holiday pay". It is common practice for the Company to include various overtime payments other than late-night overtime payments in the calculation of holiday pay.
4. In its submission to the Rights Commissioner the Union cited previous Labour Court recommendations (LCR12716, 16171, 13346) that exist in relation to this matter. However, the Rights Commissioner chose to ignore the previous decisions of the Court and concluded that the Union's claim should fail on the basis that holiday pay is calculated in accordance with the Organisation of Working Time Act, 1997.
5. The inclusion of regular and rostered overtime for the purposes of calculating holiday pay is a well established practice within the retail sector and many of Tesco's main competitors include regular and rostered overtime in holiday pay.
6. The Rights Commissioner stated in his recommendation that "changes to the status quo must come as a direct result of a negotiated improvement between the parties". The Union has attempted to reach agreement with the Company at national level without success. The Company's position that it would require some form of "quid pro quo" was unacceptable to the Union.
COMPANY'S ARGUMENTS:
4. 1. There is no collective agreement or established practice between the Company and the Union which provides for the inclusion of voluntary Sunday overtime in holiday pay.
It is an established fact that any concession in this area has only ever been achieved through the process of negotiation and collective agreements.
No overtime, regular or irregular, other than that which is provided for in the established late-night agreement is paid to any staff in the Company.
2. The Organisation of Working Time Act, 1997 and in particular statutory instrument 475/97 for the first time clearly defines pay for the purpose of calculating holiday pay. This piece of legislation is unambiguous in excluding pay for any overtime.
3. Given the Company's collective bargaining process and the law, it would be inappropriate for a standard to be imposed on the Company which was not agreed by a collective agreement and/or established in the appropriate statute.
The imposition of such a standard which was not freely entered into by the Company could in fact constitute a breach of the 1997 Act itself.
4. The 1996 collective agreement which introduced, among other things, Sunday working did not provide for the inclusion of Sunday overtime in holiday pay. In fact the Union insisted in the same agreement that Sunday working would not be contractual and that it would remain strictly voluntary for those staff employed prior to the 12th of December,1996. The availability of Sunday overtime is strictly at management's discretion and is not an entitlement and remains voluntary for the individual to work it or not.
If the claim for including voluntary Sunday overtime in holiday pay had arisen during the 1996 or subsequent negotiations then given its cost implications it would have reduced the benefits which were costed and agreed by the Company for each of the respective collective agreements.
5. The Union has raised the issue of the inclusion of regularly worked and regularly rostered overtime in holiday pay nationally and the Company has responded by stating that discussions can only commence on this issue if the Union is agreeable to off-setting the potential significant costs involved on a "quid pro quo" basis. The Union initially indicated its willingness to engage in this process and at a later stage withdrew from this approach.
6. Any concession of the Union's claim would give rise to an unacceptable precedent in relation to the inclusion of overtime in holiday pay which would have serious cost repercussions throughout the Company.
7. The Union's claim which is a cost increasing claim for improvements in pay and conditions of employment is in clear breach of the cost stabilisation clauses of Partnership 2000 and the Programme for Prosperity and Fairness.
DECISION:
The Court has considered all aspects of this appeal and decides that the Rights Commissioner's recommendation should be upheld.
Therefore, the appeal fails.
The Court so decides.
Signed on behalf of the Labour Court
Caroline Jenkinson
19th July, 2000______________________
FB/CCDeputy Chairman
NOTE
Enquiries concerning this Decision should be addressed to Fran Brennan, Court Secretary.