FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2004 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : FMC INTERNATIONAL (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - TECHNICAL, ENGINEERING AND ELECTRICAL UNION SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION UNITE DIVISION : Chairman: Mr Duffy Employer Member: Mr Grier Worker Member: Mr O'Neill |
1. Withdrawal of Gainshare Scheme.
BACKGROUND:
2. The Company was established in Little Island Cork in 1977 to manufacture and supply Microcrystalline Cellulose for the Food and Pharmaceutical industry. The Company has a sister plant in Delaware in the U.S.A.and both plants are very successful to date. New competition from low cost countries such as India coupled with significant increasing raw material and energy costs is putting pressure on the Company's market share. Due in part to economic and competitive challenges the gain sharing scheme which was introduced in 1999 would be discontinued by the Company, the Unions on the other hand consider the scheme to be a permanent part of their member's pay and benefit package.
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 2nd July, 2007 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 24th October, 2007.
UNION'S ARGUMENTS:
3. 1. The Gain Sharing Plan is an integral part of the Workers Pay and Benefit Package since its inception in January 1999.
2. The Workers have more than delivered and lived up to their commitments and contributed to the success of the plan.
3.There is no mechanism in the plan for the Company's decision to unilaterally withdraw.
COMPANY'S ARGUMENTS:
4. 1. The Scheme was introduced for a defined temporary period, the extensions that were applied did not give notice that it would become permanent.
2. The Company therefore had a right to give adequate notice and discontinue the scheme.
3.Cork as a location is being measured against other locations within the group on labour cost per hour, therefore the context within which a gain sharing programme can operate does not exist.
RECOMMENDATION:
The Court is satisfied that it was never the intention of the Company to have the gain-sharing scheme established as a permanent condition of employment within the plant. However, it appears that this was not fully understood by the Unions.
Having regard to all the circumstances of the case the Court recommends that the scheme should run until June 2008, at which point it should definitively end. In the interim the parties should engage in discussions on the consequences flowing from the termination of the scheme in accordance with the terms of the LRC document dated April 2003.
Signed on behalf of the Labour Court
Kevin Duffy
10th December, 2007______________________
JF.Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to John Foley, Court Secretary.