FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : YVES ROCHER MANUFACTURING (IRELAND) (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Mr Doherty Worker Member: Mr Nash |
1. Re-structuring
BACKGROUND:
2. The Company is located in Cork and is involved in the manufacture of cosmetic products. It is a subsidiary of the French owned Yves Rocher Group. The dispute concerns a major restructuring sought by the Company affecting the Fabrication and Raw Material Processing (RMP) groups, although some of the issues will only affect the Fabrication Group. The Company claims that if the changes are not agreed by the end of August, 2010, an investment of €3.5 million from the parent group in France will not be forthcoming. The proposals are as follows:
- Flexible access to full machine capacity - not limited to 200 weightings per day/1 activity per shift.
- 39 hour average working week
- Continuous production over hours present.
- Align rosters to customer demands/forecasts.
- Seasonality & Yellow/Blue time no longer applicable - requests and approval by manager, as per Company holiday policy and procedure.
- Nightshift requirement related to business needs.
- Flexing arrangements restricted to the end of the second shift.
- Review of training practices.
- Reinstatement of real time posting of production in SAP.
- Maintain the principle of bonus and salary structure.
- Align KPIs for productivity and quality, reviewed and set annually like the rest of the factory.
- Reserve hours review of usage and payment.
- Review of notice periods.
The Union accepts that changes are necessary if the Company is to remain competitive but is concerned about the effect that the changes will have on the workforce. The Union claims that there is a collective agreement from 1999 in place which the Company wishes to change. The Company's view is that the changes sought are reasonable and, with the exception of continuous production and amended training protocols, are in line with the 1999 agreement. Numerous meetings took place between the parties with the Union seeking clarification on a number of points. The main issues in contention relate to the "batch times", flexi hours, pickings & weighings, real time posting and training. The Company has offered as compensation to affected workers a performance bonus equal to €1,000 per annum. The Union is seeking a once-off payment of €5,000. On the issue of an exit package the Company is offering statutory payments plus two weeks' pay per year of service. The Union is seeking statutory plus 5.5 weeks' pay.
The dispute was referred to the Labour Relations Commission (LRC) and a number of conciliation conferences took place. As the parties did not reach agreement, the dispute was referred to the Labour Court on the 31st May, 2010, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 21st July, 2010. The following is the Court's recommendation:
RECOMMENDATION:
The Court has carefully considered the extensive written submissions made by the parties together with the oral arguments made at the hearing.
It is clear that the matters now before the Court are part of a significant change programme, major elements of which have already been agreed. This change programme is clearly necessary so as to ensure the continuing viability of the Cork plant and the employment which it maintains.
It is clear from the submissions made by the Union that the opposition to the outstanding elements of what is proposed is largely grounded in concerns at the impact which those changes will have on the working conditions and, to an extent, the pay of those affected. For its part the Company contend that the impact will be minimal and that it is not intended nor anticipated that the earning capacity of staff will be affected. It seems clear to the Court, however, that the full impact of the proposed changes can only be measured after they have been put into operation.
Accordingly, the Court recommends that changes proposed be accepted but subject to the following conditions: -
1. The operation of each of the changes in issue should be closely monitored by the parties. For this reason a joint monitoring group should be established between the union and management which should examine the effectiveness and impact of the changed arrangements at three monthly intervals over the next two years.
2. If it is found that any of the changes result in a diminution of earnings for any of those affected, appropriate compensatory arrangements should be negotiated between the parties. If agreement is not reached this matter may be referred back to the Court.
3. The Company’s offer for the inclusion of affected staff in annual performance bonus (which currently equates to €1,000 per year) should be accepted. In addition each affected employee should be paid a once off lead-in payment of €3,000 in consideration of full cooperation with the changes. This should be paid in two equal phases. The first phase should be paid 12 months after the changes have been implemented and the second phase should be paid a further 12 months thereafter.
4. The exit package proposed by the Company should be amended to provide for a payment of 5.5 weeks' pay per year of service inclusive of statutory terms.
5. The Court does not recommend any change in the current Saturday working arrangements.
Signed on behalf of the Labour Court
Kevin Duffy
26th July, 2010______________________
CONChairman
NOTE
Enquiries concerning this Recommendation should be addressed to Ciaran O'Neill, Court Secretary.