FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : CARTON BROS (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Doherty Worker Member: Mr O'Neill |
1. Sick-pay scheme.
BACKGROUND:
2. Carton Brothers operate a poultry processing business. Its activities include a feed mill and a processing plant. The poultry processing plant is located in Shercock, Co. Cavan and employs in excess of 600 people.
In 2008 the Company sought to reduce costs across the board. It was eventually agreed that the sick-pay scheme would be suspended temporarily and that savings would be made in the canteen.
The Union believed that the suspension of the sick-pay scheme was for a three-month period only and that it would reintroduced at the end of that time on the 26th December, 2008. The Company disputed this and maintains that because of the costs associated with the scheme they cannot restore it in its previous format.
At a conciliation conference on the 18th March, 2009 the parties agreed to commence negotiations on the introduction of a new sick pay scheme, that the terms of the current scheme would apply until the 18th March 2009 and that the new sick-pay scheme would be backdated to the 19th March 2009.
Negotiations failed.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 27th May 2009, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 9th October, 2009
UNION'S ARGUMENTS:
3. 1.The Union maintains that the Company suspended the sick-pay scheme temporarily and was committed to fully reinstating the scheme thereafter.
2. The provision of sick-pay cover for the first three days of sickness is of particular importance in the food sector. Currently the Unions' members are performing their duties under contract to the Employer but without any of the protections of sick pay cover which they have agreed with the Employer under that same contract.
3.The Union contends that the terms of the new scheme should include provision for cover for the first three days of sick absence, to alleviate costs associated with illness and the absence of social welfare cover during this period.
COMPANY'S ARGUMENTS:
4. 1.The Company stated that its finances are at a very delicate state and its cost base has to be addressed so that it can continue to compete. The cost of the old sick pay scheme cannot be sustained.
2. The Company maintains thatthe old scheme lends itself to abuse and that this has to be addressed by not paying for the 1st three days of sick absence.
3.The Company maintains that its revised sick pay scheme offer is in line with food processing companies in the catchment area. The Company's proposal will provide sick benefits to its employees whilst also addressing its cost base thereby helping to secure everyone's future.
RECOMMENDATION:
The matter before the Court concerns the introduction of a replacement sick pay scheme.
Due to the serious financial and competitive difficulties facing the Company, in October 2008 it was agreed between the parties that the Company’s sick pay scheme would be suspended as part of a number of necessary cost-saving measures taken at the time, in order to address its cost base. Since then the Company initiated discussions on replacing the old scheme.
While the Union protested at the withdrawal of the scheme as it had initially only agreed to a temporary suspension, it agreed to enter into discussions on a replacement scheme on the basis that any new scheme would be in line with industry norms.
The Company proposed a new scheme (full details contained in Appendix 7 of the Company’s Submission) which contained the following elements :
•No sick pay for the first three days of absence
•No payment for those with less than 1 years’ service
•For those with over 1 years’ service 2 weeks (10 working days) pay less Social Welfare Benefit, payable in a rolling 12 month period. Sick pay defined as basic pay plus shift premium.
•Where there are two or more absences in a 12 month rolling period, there will be no further sick pay for a period of 12 months.
The Union submitted a counter proposal (full details contained in Appendix 8 of the Company’s Submission) which contained the following elements :
•Sick pay from the first day of absence.
•No payment for those with less than one years’ service
- oFor those with over 1 years’ service 1 week’s pay
oFor those with over 2 years’ service 2 weeks’ pay
oFor those with over 3 years’ service 3 weeks’ pay etc. up to a total of 12 weeks’ pay, paid at full pay for 6 weeks and half pay for 6 weeks.- less Social Welfare Benefit, payable in a rolling 12 month period. Sick pay defined as basic pay plus shift premium.
- Where there are three or more absences in a 12 month rolling period, there will be no further sick pay for a period of 9 months.
Having examined the submissions of both parties, the Court recommends that the Company’s proposed scheme should be amended to provide after an absence of three days unpaid the scheme should provide for 4 weeks full pay less Social Welfare Benefits after one years’ service, subject to all other conditions contained therein.
The Court so recommends.
Signed on behalf of the Labour Court
Caroline Jenkinson
22nd October, 2009______________________
MG.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Madelon Geoghegan, Court Secretary.