FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2004 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : DE LA RUE SMURFIT LIMITED (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - DUBLIN PRINTING GROUP OF UNIONS DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Murphy Worker Member: Mr Nash |
1. 1.Loss of Shift Premium; 2. On/Off Shift Compliance with 2 Weeks Notice; 3. Length of Shift Working Week.
BACKGROUND:
2. The Company is based in Bray, Co Wicklow and is engaged in the security print business and operates from a facility employing 121 workers. The Company operates in a highly competitive business and is facing increasing competition mainly from overseas locations. In January, 2006 the Company lost a major customer, namely AIB Bank to a UK-based Comparator. AIB has been a customer of De La Rue Smurfit since its inception in 1978. The loss of this business represented in excess of 10% of the Company's turnover. At the same time the Company had to re-quote at significantly lower prices for a number of other key accounts. Management maintains that this has put the Company under a huge strain.
On 31st January, 2006, all employees were briefed on these developments and were given the outline of a Survival Plan which the Company contends is needed to address the serious loss of competitiveness in order to protect jobs and secure the future of the Company. Following negotiations the Company issued a document on 18th April, 2006 to all staff and the Union detailing the up to date status of savings agreed in principle to date (details supplied to Court). As part of the document the Company highlighted two core issues which needed to be addressed:
- The Company's right to transfer employees from shift work to days as the business dictated; and
- The Company's right to put personnel on short time working or lay off also as the business dictated.
A further meeting took place in May, 2006 at which no progress was made on the outstanding issues. The Union asked the question "as to whether this was a Survival Plan or cost cutting measures". The Union believes that it was not a Survival Plan but a Restructuring Plan.
As there was no engagement from the Unions on the issues of on/off shift and short time and the dispute could not be resolved at local level it was the subject of a Conciliation Conference under the auspices of the Labour Relations Commission on the 3rd July, 2006. The Company contends that the Union would not deal with the two issues in isolation and requested that negotiations revert to discussing the Survival Plan. As agreement was not reached, the dispute was referred to the Labour Court on the 8th September, 2006 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 1st November, 2006.
COMPANY'S ARGUMENTS:
3.1 What the Company requires is standard practice within the industry. The need to remain competitive is fundamental for the Company which operates in a highly competitive industry which is experiencing significant difficulties driven by excessive capacity, eroding margins and low cost imports.
2. The problems in this industry have been clearly demonstrated where a number of Companies have closed. Almost all of the surviving companies in this industry have had to down-size.
3. The changes sought are vital to sustain and protect the Company's business into the future and thechanges sought fully comply with the industry norm. The current work practices are inflexible and restrictive and adversely affect the Company's competitiveness.
4. No job losses will result from the changes.
5. The company has been open and transparent with the Union groups throughout these long and protracted negotiations. By their inaction some Union groups have frustrated the process.
6. The nature of the business is changing and the Company must change with it to ensure the long-term future of the Company and maintain employment for all staff.
UNION'S ARGUMENTS:
4.1 The Company's "Survival Plan", cannot be justified and has been modified to a Restructuring Plan. It is the Union's view that the Survival Plan was proposed in order to undermine the current pay and conditions at the plant.
2. Modification has taken place because of the output required and significant savings have been made.
3 Loss of Shift Premium - apart from the obvious drop in income of 20% on the flat week, the implications for the pension subscriptions and entitlements of workers are far-reaching. These subscriptions and entitlements are based on income inclusive of shift. Thus with the loss of shift premium, workers' pensionable salaries on which their entitlements are based will automatically be eroded.
4. The current employees on shift work have enjoyed this premium since they were employed by the Company (some for over 25 years) and have enjoyed terms and conditions as such just like Gardai, Nurses, Hospital staff, etc. In some cases workers on shift were employed as shift workers on the terms and conditions offered to them by the Company when deciding whether to take up employment with the Company.
RECOMMENDATION:
The Court has carefully considered both the written and oral submissions of the parties on the three issues brought before it.
The Court is satisfied that the Company is in a very difficult trading position arising principally from the loss of a longstanding major customer and severe competitive pressures in the marketplace and that therefore there is a compelling urgency to address the issues before the Court within a defined timescale.
The Court is equally satisfied, however, that further discussions and negotiations on these issues between the parties is necessary.
The Court has carefully reviewed the issues brought before it, namely, Loss of Shift Premium, On/Off Shift Compliance with Two Weeks’ Notice and Length of Shift Working Week and is clear that the changes required involve a fundamental change for the workers concerned.
The issue of Loss of Shift Premium arises in two respects, namely, for the eight employees involved in the Cheque Finishing Department it involves an immediate move from permanent shiftwork to working days and an agreement to work shift on an “as required” basis. Other employees on permanent shift will be required to do likewise at an agreed date. The Court is of the view that the parties should enter discussions on reaching agreement on a compensation package for the permanent loss of the shift premium for the respective employees concerned.
The Court is of the view that the Company should clearly outline its requirements for On/Off Shift Compliance for the future and therefore the Court recommends that the parties should enter into further discussions to reach agreement on the new terms and conditions arising. On the final issue of Length of the Shift Working Week, the Court recommends that the parties should include in the discussions on the new flexible working arrangements the introduction of the 38.5 hours per week as sought by the Company.
The Court is therefore of the view that the parties should enter into further discussions on these issues along the lines indicated as a matter of urgency and with the assistance of the Industrial Relations Officer as necessary with a view to reaching agreement no later than 15th December next referring any outstanding issues back to the Court for final Recommendation thereafter.
Signed on behalf of the Labour Court
Caroline Jenkinson
21st November, 2006______________________
JBDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Jackie Byrne, Court Secretary.