FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2004 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : GLANBIA MEATS (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Grier Worker Member: Mr Nash |
1. Breach of Company/Union Agreement.
BACKGROUND:
2. Glanbia is a major Company involved in the meat industry. Its Edenderry plant employs approximately 390 workers. The Plant exclusively processes pigs. A Company/Union agreement was reached between the parties in the early 1990’s. The dispute revolves around the disagreement over the interpretation of the Company/Union agreement which states "allocating a worker of a particular grade to any job in that grade or to any lower grade job, regardless of operation locationwithout loss of pay". The issue centres around Management's letter of 14th June, 2004 and their interpretation of "without loss of pay". Custom and practice has been that staff retain their rates and conditions without any loss of pay on an on-going basis if they were redeployed within the plant. The Union claims that as a result of the introduction by Management of a new work system within the shoulder boning work area of the plant, seven workers have suffered an ongoing loss of earnings, this would include the two highest earners. The Union claims that as a result of the transfer of this new process the workers will continue to suffer pay losses which is a clear breach of the Company/Trade Union agreement.
The Company calculated the loss in earnings for the 13 week period emphasising that a ceiling of €1,500 was the maximum that would be paid in compensation for loss of earnings. At the end of the 13 week period 7 workers were achieving a lower rate per hour on the new system versus the old system and 12 workers were earning more on the new system than they were on the old system.
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 29th September, 2004 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 22nd February, 2005.
UNION'S ARGUMENTS:
3. 1 The Union supports the principles outlined in the current Sustaining Progress deal which covers modernisation, flexibility and change within the work place.
2. To date, and during the lifetime of the current Union/Management agreement, the workers embraced change in work practices etc. They have always agreed to total mobility within the plant.
3. The Union/Management agreement guarantees that in the case of a particular worker of a grade allocating to any job in that grade or any lower grade job, regardless of operation or location, there will be no loss of pay.
4. The agreement has worked well over the years for the parties concerned and has stood the test of time. It has given Management total flexibility of movement of staff within the plant and it has given the workers a protection against loss of earnings.
5. If the "loss of earnings" clause is removed from the agreement, workers will be left exposed to possible loss of earnings. This clause should remain in place until agreement is reached with the Union to either amend same or until a new agreement is put in place.
6. The Union have requested discussion with the Company on a change/modernisation agreement. The Union believes that a joint forum should be established to help process change and modernisation within the Company.
7. There are serious implications for the rest of the workers within the plant if Management are allowed to breach the agreement.
COMPANY'S ARGUMENTS:
4. 1 The 13 week period of compensation for loss of earnings used by the Company in this instance comes from a precedent set by a Rights Commissioner's Recommendation on the 29th July 1998 (IR131/98), the Recommendation was upheld by the Labour Court on 16th December, 1998 (AD9982).
2. The Company is operating in an extremely, competitive environment. At a national level the cost to the farmer in producing the pig is too high and internationally the scale of operation is seriously effecting the Company.
3. The Irish market is tiny in relation to the amount of pigmeat produced, thus the Company have to rely on the world export market.
4. Every extra cost has a detrimental effect on an already small net margin. Over a 13week period the losses were calculated and accumulated without loss of pay.
5. The introduction of the 'team shoulder boning line' system was carried out against a background of concern re loss of earnings.
6. It is imperative that the Company in Edenderry become and remains a flexible low cost producer of pigmeat.
RECOMMENDATION:
The dispute concerns a disagreement over the interpretation of a clause in the Company/Union agreement which provides for the allocation of a worker of a particular grade to any job in that grade or a lower grade, regardless of operation or location – without loss of pay. The Company are of the view that this clause referred to temporary postings of workers in other grades or locations; however, this is disputed by the Union who contend that it applies in the present case.
The dispute over the interpretation of the clause arose when the Company introduced a new work system within the shoulder boning area to improve efficiency, which altered the piece rate system from an individually based system to a team based system. This change resulted in seven skilled workers suffering a loss of earnings. The Union claims that this is in breach of the Company/Union agreement.
To address the difficulties the Company is currently facing, the Union indicated their willingness to work with the Company on a Change/Modernisation Plan, without exposing it to additional costs.
The Court is of the view that the introduction of new Boning Line Team Working is a new arrangement designed to improve efficiencies within the plant, and as such was not envisaged by the current Company/Union agreement. However, the Court would not expect that workers would be disadvantaged by such changes and therefore, any loss in benefits would normally be the subject of negotiation.
Accordingly, having considered the views of the parties expressed in their oral and written submissions, the Court recommends acceptance of the Company’s offer made at conciliation where it indicated that this new working arrangement was permanent and indicated that it was willing to introduce a new rate which would benefit the majority of staff and was also prepared to pay a phasing out of existing pay terms for those it did not benefit.
The Court notes that the skilled workers are prepared to work the new agreed process but not to loose earnings. The Court recommends that an agreed new rate should be introduced as per the Company’s proposals at conciliation and that a phasing out arrangement of 52 weeks with no cap, should apply.
The Court also recommends that the parties should immediately engage in discussions on a Change/Modernisation Plan as proposed by the Union. These discussions should be completed no later than the end of April, 2005.
Signed on behalf of the Labour Court
Caroline Jenkinson
14th_March, 2005______________________
JBDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Jackie Byrne, Court Secretary.