FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : BON SECOURS HEALTH SYSTEMS LIMITED (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - BON SECOURS GROUP OF WORKERS (REPRESENTED BY SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION INMO IRISH MUNICIPAL, PUBLIC AND CIVIL TRADE UNION MLSA) DIVISION : Chairman: Mr Duffy Employer Member: Mr Doherty Worker Member: Mr Nash |
1. Pay cuts
BACKGROUND:
2. The Company is a not-for-profit registered charity and operate hospital in Cork, Galway, Dublin and Tralee. Pay rates in the Company have historically been aligned with those in the Public Health Sector. In December, 2009, the Company sent notice to all staff which outlined notification of pay cuts of 4% and 5% effective from 1st January, 2010, as part of its Remedial Action Plan. The Unions sought reversal of these pay cuts and, following a ballot of members, issued notice to engage in strike action. Following talks the parties agreed to attend the Labour Relations Commissions (LRC). Following a conciliation conference proposals were agreed, strike action was suspended and wages were restored to December, 2009, levels. An independent financial review was conducted by Mazars Financial Group but the parties could not agree on the results of the review.
The dispute was referred back to the Labour Relations Commission (LRC) and a second conciliation conference took place. As the parties did not reach agreement, the dispute was referred to the Labour Court on the 16th April, 2010, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 21st April, 2010.
UNIONS' ARGUMENTS:
3. 1. The Company made the pay cuts without any consultation with the Unions.
2. The Unions do not accept that the Company has a perilous financial situation position warranting pay cuts. From the Mazars Report it appears to have significant assets, solid profit-led growth and low levels of debt.
3. The Unions believe that were it not for the current Public Sector paycuts imposed by the Government the Company would not have made the paycuts it did in December, 2009.
COMPANY'S ARGUMENTS:
4. 1. The pay cuts proposed are less than those imposed in the Public Sector to which the Company has always been aligned in regard to pay.
2. It is essential that the Company achieves the savings outlined in the Remedial Action Plan to address its deteriorating financial position. In proposing cuts of 4% and 5% the Company is seeking to minimise the impact on staff rates of pay. In the event that it cannot proceed with these cuts the Company would have to implement an alternative cost containment strategy.
RECOMMENDATION:
It is highly relevant that the staff involved in this dispute have historically been aligned for pay purposes with corresponding grades in the Public Health Service. The effect of this pay parity was that all adjustments in pay applicable to the Public Sector have automatically applied to the staff employed by this Employer.
The Court has also come to the conclusion, based on the report of the Independent Advisor appointed on foot of the agreement reached at the Labour Relations Commission, that the employer is experiencing significant financial and commercial difficulties. It is also clear that these difficulties necessitate a programme of cost containment. Having regard to the de facto adjustments which have taken place in the Public Health Service, and the traditional pay parity which has existed with those employments, it is not unreasonable for the Employer to consider pay costs in the context of its programme of cost containment.
In light of these considerations the Court recommends that the dispute be resolved on the following basis:-
- 1. The long established pay parity between the staff of the Employer and corresponding grades in the Public Health Service should be maintained and nothing in the Recommendation should be construed as altering that pay parity in the future.
2. In the Autumn of 2010 full consultation should take place with the Unions in relation to the budgetary position for 2011.
3. The pay adjustments which applied in the month of January 2010 should be reinstated from 1st May 2010 but without any retrospective effect in respect of the month of January during which they applied. The position should be reviewed by the parties at the end of December, 2010.
4. The parties should have regard to any agreement which may be reached in respect to the Public Health Sector.
5. The parties should agree that there will be no further proposals for pay adjustments during 2010.
Signed on behalf of the Labour Court
Kevin Duffy
30th April, 2010______________________
CONChairman
NOTE
Enquiries concerning this Recommendation should be addressed to Ciaran O'Neill, Court Secretary.