FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2004 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : INDESIT IRELAND (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - AMICUS/UNITE DIVISION : Chairman: Mr McGee Employer Member: Mr Doherty Worker Member: Mr Nash |
1. Closing of Defined Benefit Pension Scheme to new employees, and hiring of new employees on different contracts to existing agreements.
BACKGROUND:
2. The Company manufactures washing machines, tumble dryers, refrigerators etc. It employs 53 Field Service Engineers (FSEs) in Ireland. There are two issues involved in the Union's claim:
(1) Closing of the Defined Benefit Pension Scheme (the DB Scheme): In 2005, following talks between the parties the employees agreed to increase their contribution to the DB Scheme by 3% to a total of 7%. The Union claims that in 2006 it became aware that new recruits were not given the option of joining the DB Scheme. They had the option of joining a Defined Contribution Pension Scheme (the DC Scheme). Following a conciliation conference in July, 2006, management confirmed that the DB Scheme was closed to new recruits since April, 2006. It claimed that this was as a result of Actuarial Advise received from two consulting firms.
(2) Different contracts of employment: there are three issues involved (a) the Pension Scheme as described above, (b) new recruits have a higher number of call per week and (c) new recruits do not have a half day off every third Friday as per February, 1995, agreement. Management confirmed that new contracts had been offered since Summer, 2004, to new recruits as previous terms and conditions had become uncompetitive.
The dispute was the subject of two conciliation conferences. As the parties could not reach agreement the dispute was referred to the Labour Court on the 30th August, 2007, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 10th January, 2008.
UNION'S ARGUMENTS:
3. 1. Neither of the Actuarial Reports made any recommendation to close the DB Scheme to new entrants.
2. The Company/Union agreement has existed for decades. The Company has unilaterally changed the terms and conditions of employment for new recruits which is totally unacceptable.
COMPANY'S ARGUMENTS:
4. 1. The DB Scheme was closed following lengthy negotiationswith AMICUS in the UK which were attended by Irish representatives. The Company was facing serious financial costs in the continuation of the scheme.
2. New contracts for new entrants which have been in effect since 2004 are more in line with the current industry standards, and reflect both the average in rates of pay and the number of calls in the market.
RECOMMENDATION:
The Court would reaffirm its long-held contention that Union/Management agreements should continue in operation until the parties agree to replace them.
While the Court cannot re-open the closed pension scheme, and notes the acceptance of new recruits into this scheme, the question of terms & conditions of employment for the Union's members should continue to be the subject of discussions under the existing agreement until the parties agree to replace it.
The Court so recommends.
Signed on behalf of the Labour Court
Raymond McGee
14th February, 2008______________________
CONDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Ciaran O'Neill, Court Secretary.