FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2001 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : TEXACO IRELAND LTD - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Mr Carberry Worker Member: Mr O'Neill |
1. Remuneration
BACKGROUND:
2. The issue before the Court concerns a claim by the Union on behalf of it's members who are employed at middle Management level at Texaco Ireland Ltd, for the backdating and restoring of their terms of remuneration. The Union maintains that prior to April 2000, salary increases were achieved through two mechanisms, merit increases and National Wage Agreement increases and that senior Management made a unilateral decision to change the remuneration terms of middle Management without consultation with it's members. The Union is seeking redress for remuneration losses and to have the original agreement on pay restored.
The Company rejects the claim on the basis that no such pay agreement existed and that no arrears are due.
The dispute could not be resolved at local level and was the subject of a conciliation conference under the auspices of the Labour Relations Commission. As agreement was not reached, the dispute was referred to the Labour Court on the 21st October, 2003, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 8th January, 2004, the earliest date suitable to the parties.
UNION'S ARGUMENTS:
3. 1. Member's terms and conditions of employment have been unilaterally and adversely altered, in what is understood to be a cost cutting exercise and is not in keeping with Social Partnership.
2. The workers have been denied their rights to National Wage Agreements by senior Management while their colleagues have been paid in full.
3. Retrospective payment of National Wage Agreement should be as follows: 4% under phase 3 of Programme for Prosperity and Fairness, backdated to April 2002, 3% under phase 1 of Sustaining Progress, backdated to January 2003, 2% under phase 2 of Sustaining Progress, backdated to October 2003, and a commitment to pay the final 2% phase of Sustaining Progress, maintenance of salary bands in line with National Wage Agreements and elimination of competitive objective from salary bands.
COMPANY'S ARGUMENTS:
4. 1. Company policy on Management pay states that increases are based on individual performance based on set objectives and pay scales and terms and conditions are based on local market conditions.Performance is measured by a performance management process.
2.Pay scale increases have been in excess of the National Pay Agreements.The Company is committed to maintaining a competitive remuneration package.
3. Company policies and process are fair and reasonable and all employees have been adequately rewarded on the basis of their individual performance, based on local market conditions.
RECOMMENDATION:
The Court is satisfied that the long standing arrangements within the Company was to determine pay increases in respect of the claimant group by reference to National Pay Agreements and to apply an additional element in respect of merit pay. The Court is further satisfied that this arrangement had become an implied term in the claimants conditions of employment. In these circumstances the Company was not justified in unilaterally changing those conditions in respect of existing staff without seeking to reach agreement on the proposed change.
In the circumstances the Court recommends that the established practice should be restored. In that regard the parties should meet with a view to agreeing the amounts due in respect of increases under the previous arrangements in the period 2001 to date. The calculations should be as follows:
1. The total increase paid in the period ( excluding the increases in respect of anomaly adjustments and grade realignment) should be calculated in respect of each individual.
2. The total increase which would have been paid had the PPF and SP agreements been applied in full in the relevant period should be calculated.
3. The average merit pay awarded to each individual calculated by reference to the amount which they received in each of the preceding three years should be established.
4. The difference between the sum of the amounts at 2 & 3 and that at 1 should be the basis for determining the arrears due.
The Court further recommends that the parties should enter into immediate discussions on the arrangements to apply to this group in the future.
Signed on behalf of the Labour Court
Kevin Duffy
22nd January 2004______________________
JO'CChairman
NOTE
Enquiries concerning this Recommendation should be addressed to Jo O'Connor, Court Secretary.