FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2004 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : TABETEX (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - MANDATE DIVISION : Chairman: Mr McGee Employer Member: Mr Grier Worker Member: Mr O'Neill |
1. Pay Increase
BACKGROUND:
2. The claim before the Court is for an increase in pay from €8.48 per hour to €10 per hour based on a 39 hour working week. The Union are seeking this to be paid in retrospect from the 1st January 2006. The Company contends that it is operating at a loss and could not afford the wage increase. The Company agreed to having an external examiner look at its books. After being examined the external examiner concluded that the Company could not pay the proposed wage increase. However, the Company did provide pay increases up to June 2005 which did not increase the loss position for the year ended June 2006 when compared with June 2005. Therefore, the examiner concluded, it may be possible to pay a similar increase in 2006 without increasing the loss for June 2007 beyond that of June 2006. Following further talks the Company indicated that it would implement the terms of Towards 2016 with a commencement date of 1st July, 2007 a deferment period of eighteen months and no retrospection. The Union's members rejected this when balloted.
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 could not be reached, the dispute was referred to the Labour Court on the 21st March, 2007 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 29th August, 2007, the earliest date suitable to the parties.
UNION'S ARGUMENTS:
3. 1 Taking the Company's offer into account the rate of pay would increase to €404.82 per week. The average industrial wage for 2006 is €624.45 for males and €451.12 for females. In similar businesses in the area where the Company is located, wages are higher yet the skill requirement would not be as great.
2 Staff in the factory are highly motivated despite the low wage rate, are flexible and committed to work with the employer to make the business a success. The Union believes the external examiners report on the Company's finances makes it clear that the Company can give a wage increase without worsening its financial position.
3 Staff have had to endure high inflation on low wages. To expect them to get no increase for 2006 and to bear the brunt of inflation means these are currently worse off in their take home pay.
COMPANY'S ARGUMENTS:
4. 1 The Company has adequately demonstrated it is loss making, The Company are perfectly entitled to seek cost offsetting measures to help safeguard its financial performance and deferring the implementation of Towards 2016 pay increases, as provided for in that agreement, is an effective and reasonable measure.
2 The Company consented to an external review of its financial reports by an external audit firm nominated by the Union. This review confirmed the Company continued to make a loss in 2006. It suggested that a pay increase in the second half of 2006 may not make loss making worse, but this was unacceptable as to consent to increased losses could not form a basis for the Company to proceed.
3 The Company clearly set out from the initial conciliation that it would not be able to review the implementation of Towards 2016 before April 2007. Ultimately it offered a start date of 1st July 2007, with no retrospection in order to settle the claim prior to a full Labour Court hearing, but this was not accepted.
RECOMMENDATION:
The last phase of "Sustaining Progressing" expired for these workers on 31st December 2005. It is clear that Custom and Practice within this employment was that National Wage Agreements were implemented. The Court is strongly of the opinion that the appropriate increases at this time are those due under "Towards 2016".
The Court accordingly recommends that the parties should re-engage as a matter of urgency to negotiate the introduction of increases due under "Towards 2016" using, if necessary, the provisions of that Agreement to determine from what date the offer already made by the Company should apply.
Signed on behalf of the Labour Court
Raymond McGee
30th September, 2007______________________
DNDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to David P Noonan, Court Secretary.