FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 20(1); INDUSTRIAL RELATIONS ACT; 1969 PARTIES : ESB - AND - A WORKER DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Doherty Worker Member: Ms Ni Mhurchu |
1. Payment of 1% salary increase.
BACKGROUND:
2. The issue before the Court concerns a claim by the Worker for payment of a 1% salary increase owed to him since December, 1992. It was recommended by the ESB Industrial Council, as part of the Programme for Economic and Social Progress (PESP), that a 1% salary increase would apply only to staff who opted for payment by credit transfer. The 1% increase would be paid as a superannuable lump sum each Christmas. It is the Worker's case that he is exercising his statutory right to be paid his salary in cash and by the ESB depriving him of the 1% increase, they are not paying the full terms of the PESP to which he is entitled. The ESB argues that he is not entitled to the 1% increase, as agreed by the ESB and the Group of Unions, because it is in consideration of a transfer of payment from cash to credit transfer.
On the 26th May, 2009 the Worker referred the issue to the Labour Court, in accordance with Section 20(1) of the Industrial Relations Act, 1969. The Worker agreed to be bound by the Court’s Recommendation. A Labour Court hearing took place on the 11th November, 2009.
UNION'S ARGUMENTS:
3. 1 Only a small minority of employees were on cash payment. All members of the Trade Unions were given an opportunity to ballot on the issue of the 1% salary increase despite the fact that the recommendation of the Industrial Council was inapplicable to a large majority.
2 The Chairman of the Industrial Council stated that in accepting such proposals there is no infringement on the rights of any employee.
3 The agreement negotiated by the group of Unions and the ESB did not constitute a contract between the worker, as an individual employee and his employer. Membership of a Union does not have the consequence that every agreement made by the Union binds every member of it. The worker concerned was not a party to the agreement as he consistently opposed the condition in relation to the 1%.
COMPANY'S ARGUMENTS:
4. 1 The ESB did not deprive any employee of availing of the 1% annual lump sum payment. It was open to all relevant employees to avail of the offer. The Worker decided not to take up the offer.
2 In return for flexibility and change, staff would be rewarded. This discretionary increase was negotiated on in a transparent manner with the involvement of the Industrial Council and was balloted on fairly. The majority of ESB workers voted in favour of it.
3 ESB denies that it failed to pay the salary increases under PESP.
RECOMMENDATION:
The claim before the Court concerns the worker’s loss of 1% of salary and consequent implications for his pension benefit and lump sum on retirement. He maintains that this payment was due from December 1992 under the terms of Clause 3 of the Programme for Economic and Social Progress (PESP) :-
- "Exceptionally, employers and trade unions may negotiate changes in rates of pay and/or conditions of employment which may be for an amount up to but not exceeding 3% of the weekly/monthly basic pay cost of the group of employees concerned. Such changes may be implemented, on a phased
basis where appropriate, commencing not earlier than the second year of the Agreement in each particular employment/industry in the private sector, including the commercial State-sponsored bodies”.
- “Negotiations under this Clause will take full account of the
implications for competitiveness the need for flexibility and
change and the contribution made by employees to such
change."
Following negotiations between the Company and the ESB Group of Unions, the ESB Industrial Council recommended payment of the 3% under certain conditions as laid down in Case No 2450 dated 18th June 1992. At subparagraph(2)it stated the following: -
- Acceptance of Cashless Payroll for the future.
(The proposal put forward under this heading was –
•A 2% salary increase to apply for an agreement, which would be reached on the 6 items excluding Cashless Payroll.
•a 1% salary increase to apply to staff who now opt for payment by Credit Transfer. To avoid members of a category being on different scales ESB proposed that this 1% salary increase would be paid as a superannuable lump sum at Christmas).”
The Claimant did not opt for payment of salary by credit transfer instead preferring to continue to have his salary paid by cash.
At the time Management explained that the 1% payment under the terms of Clause 3 of PESP was as an inducement to employees to opt for cashless pay.
In subsequent years, in order to facilitate those who had opted out in 1992, the Company offered further incentives to workers to avail of the increase (on condition they transfer to payment by credit transfer). The worker here concerned did not avail of such opportunities. The Court notes that the worker may still avail of the 1% increase from a current date and make the necessary contributions into the Superannuation Scheme.
Over a number of years the worker has attempted to process his claim through a number of avenues. He maintained that an agreement negotiated by the ESB Group of Unions and the Company did not constitute a valid contract between him as an individual employee and his employer.
Having considered the submissions of both parties the Court is of the view that the worker has no entitlement to the 1% as claimed, he decided of his own free will to opt out of a duly processed collective agreement in 1992. Furthermore, the Court is satisfied that his legal rights were not compromised.
Accordingly, the Court rejects the worker’s claim.
Signed on behalf of the Labour Court
Caroline Jenkinson
27th November, 2009______________________
DNDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to David P Noonan, Court Secretary.