FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : HOLLISTER ULC - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Mr Keogh Worker Member: Mr. Somers |
1. New working arrangements.
BACKGROUND:
2. Hollister Inc. is a privately owned U.S. multi-national manufacturer of medical device products, namely all forms of Ostomy products. Hollister ULC, the Irish subsidiary, was founded in Ballina, Co. Mayo, in 1976. It currently employs approximately 290 people.
In January, 1999, discussions commenced between workers and management on the issue of gainsharing. In September, 1999, the Company's proposals were rejected by a majority of workers by secret ballot. A number of workshops and local meetings were then held to discuss several issues including basic pay, productivity output, payment over agreed phases and a review of the current benefits package (i.e. sick pay, service pay, industrial peace bonus, perfect attendance bonus and pension). The issues were also the subject of two conciliation conferences under the auspices of the Labour Relations Commission on the 19th and 24th of July, 2000. The Industrial Relations Officer produced a proposal which both parties agreed to recommend for acceptance. However, at a general meeting on the 29th of July, 2000, the employees rejected the proposal by a three to one majority. The dispute was then referred to the Labour Court in accordance with Section 26(1) of the Industrial Relations Act, 1990. The Court investigated the matter on the 12th of September, 2000.
UNION'S ARGUMENTS:
3. 1. The agreement should be made up of three phases, not four, as is suggested. Payments should be £38 for the first phase, £12 for the second phase and £5 for the third phase. These amounts should attract the increases due under the Programme for Prosperity and Fairness and should be backdated to the first phase, i.e. 5.5% on the 1st of June, 2000, plus any review agreed with the social partners.
2. The productivity figures should be 58% for the second phase and 67% for the third. The 75% output required on the fourth phase would be impossible to achieve due to downtime on machines, a lack of materials, additional duties to be carried out under the new process and the reliance on external factors.
3. A peace bonus and attendance bonus should be paid out as a Christmas bonus equal to the maximum paid out under the old scheme. A death-in-service benefit of three times' salary should apply from the 1st of January, 2000. Sick pay and perfect attendance should be as per the L.R.C proposal and Management clarification of the 26th of July, 2000.
4. The Union and the employees are totally opposed to the proposed new entrants' grade and rate of pay. It will create inequality within the plant, will undermine the concept of team-working and in time, it will create unrest amongst staff.
5. Length of service should be recognised as follows:
10 years' service - 2%.
12 years' service - 2% plus one day's leave.
15 years' service - 2.67% plus one day's leave.
20 years' service - 3.34% plus two days' leave.
25 years' service - 4% plus three days' leave.
6. If the Management plan goes ahead as planned, the Company will double its business and will increase profits dramatically over the next eight years. The employees are not opposed to change but believe that it should be recognised and properly rewarded. Monitoring committees and project teams should be elected and the Union should have the right to bring in experts when required.
COMPANY'S ARGUMENTS:
4. 1. The Company's conditions of employment are competitive in the local labour market and its current rates of pay are only a little behind. The implementation of the new agreement will ensure that rates and conditions will be more than comparable with any employer, similar in size, market and turnover, in or outside the region.
2. The proposed increases will, if the effectiveness levels are achieved, give a minimum increase to an Operator of 37% and a maximum increase of 40%. These are very substantial increases indeed.
3. The proposals which were put to SIPTU are better than those which have recently been accepted by the Technical, Engineering and Electrical Union (TEEU). The maximum percentage increase for a semi-skilled TEEU member is 32.5% and 29.6% for a skilled person. The Company cannot improve on the SIPTU proposals without jeopardising the TEEU agreement.
4. The TEEU members have accepted a four phase agreement, the final phase of which is achieved at 75% effectiveness. They obviously believe that it can be achieved. However, the Company is willing to discuss the final phase with the various parties if it cannot be achieved, despite the best efforts of all concerned.
5. The Company must achieve efficiencies to maintain its margins in a highly constrained market. Any further increase in costs would be unacceptable. The first phase should only be applied from the date of acceptance, as was the intent of the Industrial Relations Officer's proposal. No provision has been made to backdate the increase.
RECOMMENDATION:
The Court has give careful consideration to the submissions made by the parties and recommends that the dispute be resolved on the following basis:
1. The Court notes the strong objections of the Union to the Company proposal to maintain a single grade structure for new employees. The Court further notes the Union's view that this proposal was a significant factor in the rejection of the terms agreed at conciliation. In these circumstances the Company should agree not to proceed with this proposal.
2. An extra 1% should be payable in respect of service pay at 15 years' service and a further 1% at 20 years' service.
3. The proposals on pay which emanated from conciliation, including the phasing arrangements, should be accepted. However, if the targets on which the fourth phase increase is based are not achieved through factors outside the control of the employees concerned, this should not lead to the automatic loss of that increase. In such an event the parties should meet to consider the situation and if necessary have recourse to third party adjudication on the matter.
4. The parties should put in place a joint monitoring group to review the achievement of the efficiency targets proposed. Both sides should have the facility to engage the services of expert assistance in this task.
5. The parties should seek to identify additional improvements in performance, which could form the basis of negotiations on further improvements in pay at the end of the proposed agreement.
6. All other aspects of the draft agreement concluded at conciliation should be accepted.
7. The commencement date of the agreement should be 24th July, 2000.
Signed on behalf of the Labour Court
Kevin Duffy
19 September, 2000______________________
D.G./S.H.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Dympna Greene, Court Secretary.