FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2001 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : UDV OPERATIONS IRELAND LIMITED - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Mr Carberry Worker Member: Ms Ni Mhurchu |
1. Various issues.
BACKGROUND:
2. The Company is part of the Diageo Group and is the Supply Company engaged in the manufacture and bottling of Cream Liqueurs and Spirits (Baileys Irish Cream, Smirnoff and Sheridans) at its facility in Nangor Road, Dublin.
The trend for increased growth for Baileys, in particular, is forecast from 5.5m cases per annum to 10m
cases in five years time. The Company introduced a night shift operation by recruiting 50 night staff on a
fixed term contract for 14 months to deliver the short-term capacity required, and, in January, 2002,
announced the outcome of its study into the longer-term capacity, i.e. the Company’s intention is to adopt
a dual-site by building a second plant in Northern Ireland which will begin production in July, 2003. The
night shift is due to end when this facility commences production.
The dispute before the Court concerns a claim by the Union on behalf of its member for compensation for
loss of potential overtime earnings.
The dispute was referred to the Labour Relations Commission and two conciliation conferences took
place. As the parties did not reach agreement, the dispute was referred to the Labour Court on the 12th of
March, 2002, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court
hearing took place on the 17th of April, 2002.
UNION'S ARGUMENTS:
3. 1. The impact of the night shift on pay and conditions of permanent staff will result in loss of overtime earnings.
2. Duties and work practices of existing staff might be adversely affected by either the contract workers in Dublin or the future employees in Northern Ireland.
3. Members expectations on overtime compensation are between 2.5 and 3.5 times the annual loss and the inclusion of the year 2001, where members worked an intensive amount of overtime to secure orders.
COMPANY'S ARGUMENTS:
4. 1. Overtime is regarded by the Union as strictly voluntary; it is not regarded as regular rostered overtime.
2. The estimate is that approximately 20% of total overtime opportunity will still remain.
3. The Company offer on overtime loss was 1.75 times by 80% of the average overtime working in 1999 and 2000 – half this amount to be paid in July, 2002. The offer is fair and reasonable and should be accepted.
RECOMMENDATION:
Whilst an extended list of items was contained in the formal referral of this case from the Labour Relations Commission, they mostly relate to the Union's claim for compensation for loss arising from the introduction of a night shift. Other issues which relate to the terms and conditions of employees on fixed term contracts employed on the night shift have now been resolved and the Court was not asked to make any recommendations in relation to them.
The overtime at issue, whilst consistently available, is voluntary and is not rostered. Nonetheless the Company have offered a once-off lump sum payment in compensation for its loss. For its part, the Union is seeking on-going improvements in conditions of employment together with an enhanced lump-sum payment.
In the Court's view, the approach proposed by the Company is fair and reasonable having regard to the voluntary nature of the overtime and the inevitability of a reduction in the number of hours which could lawfully be worked under current legislation.
The Court does, however, recommend that the formula for calculation of compensation should be modified as follows:-
1. The actual loss of overtime should be assessed by reference to the average overtime worked in the three years preceding the introduction of the night shift.
2. The figure arrived at on the basis of 1 above should be offset by the amount of overtime available in the full year after the introduction of the night shift.
3. The yearly loss arrived at by the application of 1 and 2 above should be multiplied by two.
In its submission to the Court, the Union relied on the provisions of Clause 16 of Chapter 1.3, Framework 1 of PPF in support of its contention that the Company should enter into discussions on forms of financial involvement referred to in that clause.
The effect of Clause 18 of Chapter 1.3 is that the matters referred to in Clause 16 are only amenable to third party adjudication (including investigation by the Court) where both parties agree that the issue in question can be pursued further. In the present case both parties are not agreeable that the issues of financial involvement, beyond what is already in place, can be pursued further.
The Court does, however, direct the attention of the parties to the proposals contained in Chapter 1.3 of PPF which are intended to assist in improving workplace relations and the work environment. In the Courts view the parties could usefully consider initiatives aimed at developing partnership arrangements in line with the recommendations of that Chapter.
Signed on behalf of the Labour Court
Kevin Duffy
29th April, 2002______________________
CH/CCDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Caroline Hayes, Court Secretary.