FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : IARNROD EIREANN - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION NATIONAL BUS & RAIL UNION DIVISION : Chairman: Mr Duffy Employer Member: Mr Doherty Worker Member: Ms Ni Mhurchu |
1. Locomotive drivers disability scheme.
BACKGROUND:
2. In 1977 an agreement was reached whereby it was compulsory for all locomotive drivers in CIE to be in a Disability Scheme/ Income Continuance Plan. Drivers underwent periodic medical examinations to determine their fitness to drive. The insurer and the policy have varied over the years. A new scheme was put in place in 2001 which was funded 50/50 by the parties. In 2008 the insurer, Friends First, informed the parties that the scheme was in deficit and that the premium would have to increase by almost 100%. The Company indicated to the Unions that, due to its difficult financial situation, it could not contribute any more to the scheme that it already did i.e. €25.89 per worker per week or €640,000 per annum. The Unions were unhappy with this and a number of options were looked at (details supplied to the Court).
The dispute was referred to the Labour Relations Commission (LRC) and a conciliation conference took place. As the parties did not reach agreement, the dispute was referred to the Labour Court on the 5th November, 2009, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 19th March, 2010. However, following the conciliation conference, the Company did, in fact, increase its contribution to €725,000 per annum based on one particular proposal. It has also indicated that it was prepared to fund the scheme on an interim basis to the value of €842,000 per annum, pending the outcome of the Labour Court hearing.
UNIONS' ARGUMENTS:
3. 1. The Unions agreed to consider changes to the scheme. They accepted the principle of own-occupation and were willing to further discuss the issue of redeployment of drivers.
2. The 50/50 arrangement is long-standing and any attempt by the Company to change it is unacceptable. The Unions put a proposal to the members give a number of options with different levels of premium depending on which option is chosen. The proposal was accepted by 90% of the members but could not be implemented because of the Company's refusal to increase its current contribution.
COMPANY'S ARGUMENTS:
4. 1. The Company's current financial situation does not allow for any increase in additional funds to be made available to increase its contribution (details supplied to the Court). Increasing its contribution to the scheme would have a further detrimental effect on its finances.
2. Whilst the Company has increased contributions for an interim period it cannot continue to do so. Its proposal of €725,000 per annum is appropriate with any additional contribution being funded through increased driver efficiencies.
RECOMMENDATION:
Having considered the submissions of the parties the Court recommends as follows:-
- The Company should continue to fund the scheme in issue on the basis of a 50/50 contribution for a period not exceeding three months. During that time the parties should engage in discussions aimed at identifying efficiencies which would generate savings of not less than the difference between the final offer of the Company ( an overall contribution of €725,000) and the value of a 50% contribution (€842,000).
- If such efficiencies are agreed and implemented the Company should continue to fund the scheme on a 50/50 basis.
- If sufficient efficiencies are not identified, or are not implemented, the benefit of the tax relief on the employee's contributions should accrue to the Company. Hence both sides should make equal net contributions. In that scenario, should the current tax relief available be changed the Company's contribution should increase pro rata.
Signed on behalf of the Labour Court
Kevin Duffy
29th March, 2010.______________________
CON.Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Ciaran O'Neill, Court Secretary.