FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2004 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : JURYS DOYLE HOTEL GROUP PLC - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Mr Murphy Worker Member: Ms Ni Mhurchu |
1. 1. Protection of earnings for existing staff who wish to remain post-redundancy, 2. Compensation for those staff remaining.
BACKGROUND:
2. The Company began the process of restructuring its operations in February, 2005. The Company's proposals included reduction in the number of jobs, the elimination of the current service charge system, new rates of pay, the elimination of fixed rosters, etc,. Local level negotiations were not successful and the dispute was referred to the Labour Relations Commission. A number of Conciliation Conferences were held. Following the first Conciliation Conference in September, 2005, it was accepted by the parties that all new employees, including those employed after the initial announcement of restructuring, will from 1st January, 2006, be employed on the basis of the new terms and conditions of employment, new pay scales and new job descriptions. From 1st January, 2006, the Hotel also ceases to be a service charge hotel. The parties also reached agreement on Voluntary Severance Terms. Approximately 280 staff have opted for the package. Of the workers remaining there are approximately 52 full-time staff of which approximately 41 are high earners. The Union claims that the remaining staff who were not prepared to agree to any change in their existing working arrangements would be red- circled on their current rates and terms and conditions. The Union claimed €10,000 for each remaining member of staff who agreed to take on new rosters, job descriptions and work practices. The Hotel rejected the concept of red-circling. It offered to compensate the difference through a buy-out of the difference in the rates of pay. This would entail making the difference between the old rate (basic and service charge) and the new rate redundant. A formula of five weeks' pay per year of service at the amount of the difference was offered. The Company offered €3,000 as compensation for cooperation with the level of change proposed. The offer was rejected by the Union. The dispute was referred to the Labour Court on the 1st December, 2005, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Court hearing was held on the 8th December, 2005.
UNION'S ARGUMENTS:
3. 1. The changes proposed in terms of new work practices are immense and will fundamentally alter the operation in the Hotel. The proposed revised rates of pay for new staff will result in immediate considerable savings in wage costs for the Company on an ongoing basis. The changes will improve the overall productivity and greatly enhance the competitiveness of the Hotel.
2. For staff remaining, many of whom have given considerable service to the Hotel, the new arrangements constitute a major change. In the circumstances the Company's offer of €3,000 as compensation is a pittance in return for the level of cooperation and change being proposed.
3. The red-circling of earnings for those workers remaining is an essential requirement in order to secure an overall agreement. Workers cannot be expected to work in the Hotel for lower pay than they currently enjoy. The number of workers involved is small. The actual take up of the Severance Package has exceeded expectations and, therefore, it is unreasonable of Management to continue to refuse to protect the earnings of workers remaining in the employment.
COMPANY'S ARGUMENTS:
4. 1. It is crucial that the Company's restructuring proposals are implemented in order for it to remain viable. Providing the re-structuring takes place, allowing for greater flexibility and a change in the payroll system, the Company can continue as a successful operation into the future.
2. Any costs associated with reaching a settlement for the 52 staff members are on top of significant costs applicable to the Voluntary Severance Terms.
3. Rates of pay cannot be red-circled as, to do so, would result in maintaining a significant additional payroll cost over and above that identified as being acceptable for ensuring the property is viable into the future.
4. The rates of pay on offer are very still competitive.
5. The Company cannot red-circle the rosters and job roles as the new structures would be significantly impacted upon in terms of their operation.
RECOMMENDATION:
The Court has carefully considered the submissions of the parties and recommends as follows:
Pay of Existing Staff
In the Court's view it is not practicable to enforce a reduction in overall pay for those existing members of staff who have not availed of the voluntary severance package. Accordingly, and having regard to the relatively small number of staff members involved, the Court recommends that the current earning levels of existing staff remaining be consolidated and red-circled.
So as to help reduce the number in this category further the Court also recommends that the voluntary redundancy package should continue to be available until 31st January, 2006.
Changes in Work Practices and Rostering.
The Court recommends that the Company's proposals on work changes and rostering be accepted and that existing staff members remaining each be paid compensation in the amount of €5,000 in consideration of these changes.
Signed on behalf of the Labour Court
Kevin Duffy
15th December, 2005______________________
todChairman
NOTE
Enquiries concerning this Recommendation should be addressed to Tom O'Dea, Court Secretary.