FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2001 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : CASTLEMAHON FOOD PRODUCTS - AND - AMALGAMATED TRANSPORT AND GENERAL WORKERS' UNION DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Carberry Worker Member: Ms Ni Mhurchu |
1. Payment of Programme for Prosperity and Fairness
BACKGROUND:
2. Castlemahon Food Products is a wholly owned subsidiary of O'Kane Poultry Limited, Ballymena, Co. Antrim. It employs approximately 300 people engaged in the processing and distribution of poultry products.
Since 1999 pay has been determined by output/productivity for production workers based on a system of figures and standards introduced by the Company with ATGWU agreement.
The Union sought payment of the PPF in respect of the 4% phase due from the 1st March, 2002, and the supplementary 1% lump sum due on the 1st April, 2002.
As agreement could not be reached the matter was referred to the Labour Relations Commission and a conciliation conference was held on the 13th of February, 2002. As agreement could not be reached, the matter was referred to the Labour Court under Section 26(1) (a) (b) of the Industrial Relations Act, 1990, on the 30th of July, 2002. A Labour Court hearing took place on the 11th of September, 2002 in Limerick.
UNION'S ARGUMENTS:
3. 1. The introduction of appropriate consultants on agreed terms of reference to cover all aspects of the business with the results to be shared with the Union and the workforce, is an essential ingredient in going forward.
2. The Union has presented a case of reason and logic supporting the payment of the PPF 4% and 1%.
3. The Company must honour the July 1st PPF agreement with full retrospection to preserve workplace and PPF credibility, otherwise the credibility of future negotiations will be in serious jeopardy.
COMPANY'S ARGUMENTS:
2. 1. The full cost in a year of the 4% would amount to €419,329 and this would increase existing ongoing losses.
2. Further cost increases would not allow the Company to invest in the plant structure and will quickly lead to a massive scaling down of the business and possible closure.
3. The Programme for Prosperity and Fairness states that Clause 3 (pay increases) shall be negotiated between Employers and Unions taking account of the economic, commercial and employment circumstances of the Company.
4. The Company's view is that a solution to the problem could be found in a combination of productivity rate reductions with a reduction in numbers incorporating the PPF 4% into basic.
RECOMMENDATION:
This is a claim for the payment of 4% and a 1% lump sum due under the terms of the PPF. The Company is claiming inability to pay the terms sought due to its current financial position and its immediate need to restructure and modernise so as to become more competitive. The Court accepts the seriousness of the situation and recognises the need for a combined approach to be taken by both management and the Union to restructure its operations.
The Court notes the Union's acceptance that restructuring is required and is prepared to be involved in discussions with the Company on productivity measures in return for the immediate payment of the terms sought. Similarly, management indicated its willingness to pay the 4% in return for concessions on a cost cutting programme by a combination of productivity rate reductions with a reduction in numbers.
The Court recommends that the company should set out in detail the restructuring and cost cutting measures required, together with the details of proposed dates for payment of 4% increase in pay, the 1% lump sum and the outstanding retrospection. These details must be submitted to the Union within a period of two weeks from the date of receipt of this recommendation.
Furthermore, the Court recommends that the company should consult with the Union on its financial circumstances on a regular basis and on its strategic and business plans to return to profitability and to re-establish a successful business operation.
If the matter is not resolved within one month of the date of this recommendation, the
matter may be referred back to the Court for a definitive recommendation.
Signed on behalf of the Labour Court
Caroline Jenkinson
26th September, 2002______________________
HMCD/MB.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Helena McDermott, Court Secretary.