FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : KINGSPAN LTD (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr McGee Employer Member: Mr Doherty Worker Member: Ms Ni Mhurchu |
1. (B) National Pay Agreement (C) Survival Plan
BACKGROUND:
2. The case before the Court concerns the National Pay Agreement and the proposed survival plan for the Company. The Company has three facilities, one in Ireland, one in Wales and one in the north of England. Since the beginning of 2008 the volume of production has been down at the site in Ireland. In December 2008 the Company informed the Union that a survival plan for the site would be presented after the Christmas break. It is the Union's contention that this plan consists of less favourable terms and conditions for existing employees and the introduction of new and less favourable terms and conditions of employment for future employees. The Company's position is that the survival plan is structured to build the cost competitiveness of the Company. Regarding the National Pay Agreement, the Union argue that the first phase, due from 1st January 2009, has not been paid and that the Company has not made an inability to pay claim in respect of this. The Company's position is that as the Agreement continues to be the subject of discussions by the Social Partners, it will not make any commitment with regard to the Agreement.
The dispute could not be resolved at local level and was the subject of Conciliation Conferences under the auspices of the Labour Relations Commision. As agreement was not reached, the dispute was referred to the Labour Court on the 21st July, 2009 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 19th August, 2009.
UNION'S ARGUMENTS:
3. 1 The company has not made any serious attempt to attach a consideration of compliance with existing, agreed procedures as they have pursued an agenda that seeks to affect across the board reduction of the Union's members' terms and conditions. The Company proposes to reduce labour costs at the workers expense, with reference primarily to more competitive labour costs available to them at its UK sites. In making it proposals the company does not take into account the difference in the cost of living between the UK and Ireland.
2 The workers are now reduced to short-time working and have seen significant cuts in their earnings. A concern for the Union's members is the way in which the interim production adjustments are being applied. At the moment less senior employees are retained on full-time schedules while more senior colleagues are left at home. The Union acknowledges the challenges before the Company and are committed to the survival of the site.
3 Payment of the first phase of the National Pay Agreement has not been implemented. The Union's members have already been subject to a reduction in earnings due to the effects of increased taxation, the elimination of shift work and the reduction to short-time work patterns.
COMPANY'S ARGUMENTS:
4. 1 The construction industry is in crisis. The Company has worked to cut costs in every area of the business. The management team has been significantly reduced and salaries have been frozen across the board. The Company has put forward reasonable and achievable proposals to reduce the cost differential between the sites in the UK and Ireland. It is necessary for the Ireland site to win a significant share of volume for the UK market to maintain longer term viability.
2 The Union has refused to discuss the survival plan put forward by the Company. This is despite four Conciliation Conferences. The lack of regard for the situation facing the business and the months of non-cooperation with the operation of short-time working are astounding in the current environment.
3 Since the presentation of the survival plan, the Company has at all times indicated that any consideration of the National Wage Agreement would have to be in the overall context of the survival plan.
RECOMMENDATION:
The Court has carefully considered the comprehensive submissions and appendices supplied by the parties.
The Court is not satisfied that an adequate level of meaningful discussion has taken place on the Company proposals for a site survival plan. Given the very serious situation existing, the Court recommends that the parties re-engage honestly and earnestly with a focus on solving what is a problem for both parties including disclosure of relevant financial information. Such discussions should be completed within 8 weeks of the date of this recommendation and should be overseen by the Conciliation Service of the LRC. Any residual issues may be referred back to the Court at that time.
The Court makes no recommendation at this time on the question of the pay terms of "Towards 2016".
Signed on behalf of the Labour Court
Raymond McGee
21st August, 2009______________________
DNDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to David P Noonan, Court Secretary.