FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : PWA INTERNATIONAL LIMITED (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Mr Murphy Worker Member: Ms Ni Mhurchu |
1. Application of Bonus in first quarter of 2007 and Performance Appraisal Scheme.
BACKGROUND:
2. PWA International specialises in the overhaul and repair of large commercial jet engine cases. The Company is based in Rathcoole and employs 140 permanent staff with approximately 90 involved as floor Engineering Operatives.
Since 1999 it has always been the policy of the Company to provide a Share/Production Bonus. In the first quarter of 2007 the Company wished to change the criteria of the bonus in order to encourage employee participation in specific projects and participation on specific teams. A number of meetings took place between Management and the Union over a period of several weeks during which the Union claimed that the criteria kept changing. The Union members, however, participated in the projects and events to reach the goals set out by the Company.
A bonus of €500 was paid to 11 members of the Union in the July 2007 payroll. The Union wrote to the Company stating that the criteria for the bonus were insufficient and ambiguous and that all employees should be paid the bonus.
In 2006 the Union and members of the Operations department held meetings in order to make some changes to the performance appraisal scheme. Changes were made and agreed with the union membership.
In July 2007 the Company requested that all Supervisors carry out midyear reviews with their direct reports. However, before this meeting took place some Supervisors had already begun meetings with their direct reports, before being apprised of the new rules of the scheme. Some of the Supervisors applied the old rules of the scheme, and therefore some employees received full marks in areas where they had not performed to the highest level. The majority of employees refused to sign off on their performance appraisals.
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 5th September 2008, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 28th October, 2008.
UNION'S ARGUMENTS:
QUARTER 1 BONUS
3. 1.The Union maintains that at a series of meetings to seek clarification of the terminvolvementthe Company kept changing the criteria and there was no definitive explanation other thanInvolvement = Bonus.
2. The Workers participated in the projects and events to reach the goals set out by the Company and this has been acknowledged by Management.
3.The Union is seeking the payment of the Quarter One Bonus together with the usual share purchase option to the Floor Operatives whom the Company withheld payment from.
PERFORMANCE APPRAISAL
4. In 2006 a change to the appraisal scheme was put forward by Management. It was voted on and accepted by the unionised staff. The only changes were to absenteeism and timekeeping.
5. The Union alleges that Senior Management interfered during the interim appraisals carried out by the immediate Supervisors in the summer of 2007. This resulted in the majority of Workers invoking their right of appeal.
6. The Union is seeking that the immediate Supervisors be allowed to carry out the performance appraisals unhindered or influenced by Senior Management for the year 2007/08, with the right of appeal to an independent Assessor.
COMPANY'S ARGUMENTS:
QUARTER 1 BONUS
4. 1. The Company maintains that it was made clear to the Workers that in order to earn the bonus they would have to participate in two teams and attend a minimum of two meetings and involvement was essential in order to receive the bonus.
2. The Company maintains that all Workers who participated in teams were awarded the bonus.
3. The Company believes that it would be unfair on any employee who participated in the bonus scheme to compensate those who did not participate in any way in the bonus scheme.
PERFORMANCE APPRAISAL
4. The Union Committee was involved in the creation of the new system and new form and therefore they were fully aware of the wording of the document.
5. The Company maintains that the Cell Leader or Supervisor is the person who carries out the Performance Appraisal meetings with the employees but that the Operations Manager and other Managers and Supervisors can have input into the appraisal system.
6. The Company stated that it offered two alternatives to employees in December 2007 as a resolution to the issue, neither of which the Union chose to accept.
RECOMMENDATION:
The Court has given careful consideration to the submissions of the parties in this case.
The Court does not consider it appropriate to apportion blame for the events giving rise to this dispute. Suffice it to say that the issues in dispute appear to have caused friction and disharmony in what has hitherto been a very good and productive relationship between Management and the Union which has worked to the benefit of both sides. The object of the recommendations which follow is to allow the parties to put the events in dispute behind them and to concentrate on dealing with the ongoing arrangements of performance appraisal and reward in a spirit of cooperation and partnership.
In respect of the two issues in dispute the Court recommends as follows:-
Quarter 1 Bonus
The Court notes that the continuing operation of the scheme is not in issue between the parties and that the dispute is confined to the payment for the first quarter of 2007. In all the circumstances the Court recommends that, without prejudice to the positions of either party or the reasons why the stated criteria for the payment were not adhered to, a payment of €300 be paid to all staff who received less than that amount by way of bonus for the quarter in question. This should be regarded as a once-off arrangement which will have no precedent value for any purpose in the future.
This amount should be paid within three weeks of the date of acceptance of this Recommendation.
Performance Appraisal
The Court recommends that the parties should now discuss and agree the criteria and other arrangements under which performance appraisals will be conducted in respect of 2008 and subsequent years. The criteria and arrangements, when agreed, should then be applied retrospectively to the 2007 appraisals. In undertaking this exercise the parties should have full regard to the need for transparency and objectivity in the process and the requirement that increased levels of payment be linked to improved levels of performance. An internal appeals mechanism should also be provided.
The Court so recommends.
Signed on behalf of the Labour Court
Kevin Duffy
6th November, 2008______________________
MG.Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Madelon Geoghegan, Court Secretary.