FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2001 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : LOCTITE (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - AMICUS - MANUFACTURING, SCIENCE, FINANCE DIVISION : Chairman: Mr Duffy Employer Member: Mr Keogh Worker Member: Ms Ni Mhurchu |
1. Additional 3% payment for comprehensive Company/Union Agreement.
BACKGROUND:
2. Loctite Ireland Limited is part of the Henkel group, which researches, develops and manufactures sealants and coatings for the European and Asian markets. It currently employs 450 people at its Dublin facilities in Tallaght and Ballyfermot and has been in operation in Ireland since 1996.
Unionised employees are represented by SIPTU, TEEU and MSF. There are 168 non-unionised professional/managerial employees. The Company has Comprehensive agreements with all three unions. The most recent MSF Comprehensive Agreement was signed in 2000 and continues until May 2003.
- Amicus -MSF lodged a claim with the Company for a 3% pay increase based on the fact that the two other Unions received a greater percentage increase when they signed their Comprehensive Agreements with the Company. Discussions took place locally but agreement was not reached. The matter was the subject of a conciliation conference under the auspices of the Labour Relations Commission but agreement was not reached and the matter was referred to the Labour Court on 7th June 2002, under Section 26 (1) of the Industrial Relations Act 1990. A Labour Court hearing took place on 5th September,2002.
COMPANY'S ARGUMENTS:
3. 1. The claim for the additional 3% was lodged with the Company in January,2002, a full 19 months after their Agreement was signed and over a year following the signing of the SIPTU and TEEU agreements.
2. While common rules on matters such as discipline are in place, all Comprehensive Agreements are negotiated on an individual Union basis. Otherwise there would be no need for any differences and the Company could have a joint Union Agreement with a single negotiation to cover all. This has never been the case.
3. As each Comprehensive Agreement is a separate, individual and stand-alone document, the Company entered into discussions with MSF in good faith and signed off on the Agreement to what was a fair and reasonable outcome, an outcome that was voted andaccepted by MSF members.The Company gave no assurances that each separate agreement would attract the same monetary payments or percentage increases.
4. The basis for the extra 3% settlement paid to SIPTU and TEEU grades as to overcome the difficulties in attracting people to these grades where the turnover was high.
5. The Company had to introduce a second voluntary severance package in the summer of 2002 despite the fact that it allowed natural wastage reduce numbers for 15 months. It finds itself in a difficult trading position and has been required to cut wage costs by €2 million. Its future remains uncertain. Payment of an additional 3% would have serious consequences for the Company in the competitive multi country environment in which it works. The Company is concerned about the potential knock on for the non-unionised sections of the workforce.
UNION'S ARGUMENTS:
4. 1. There has always been an understanding between the Company and the three Unions that there would be no knock-on claims arising from additional payments made to the other Unions.
2. There will be no financial repercussions for the Company if the Court would find in the Union's favour.
3. The Union believes that the Company deliberately withheld this 3% in retaliation for the lead role that Amicus-MSF played in a campaign for improved pension entitlements.
4. History shows that the three Unions have always received the same percentage increase for the core elements of the Comprehensive Agreements that are common to all employees.
RECOMMENDATION:
It is noted that historically pay adjustment have been in line with National Agreements. Separately, on the conclusion of house agreements lump sums have been paid. Significantly, the same amount was paid to all staff notwithstanding wide variations in the salaries levels of different grades.
On this occasion it was decided to depart from the previous practice and to compensate for productivity/efficiency improvements in the new agreement by was of a percentage increase in pay.
The Court has not seen any evidence to support the Company's contention that the differences in the percentage increases paid to other groups was intended to address labour market difficulties. Rather, all of the documentation seen by the Court supports the Union's contention that the higher increase paid to the two other groups was in consideration of the same range of measures for which the claimant group received a lower increase. Consequently, the Court can see no justification for a departure from the previous practice of rewarding all groups covered by collective bargaining equally in respect of house agreements.
In all the circumstances the Court recommends that the Union's claim be conceded.
Signed on behalf of the Labour Court
Kevin Duffy
26th September, 2002______________________
HMCD/MB.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Helena McDermott, Court Secretary.