LCR20182

The Union agreed to be bound by the Court’s Recommendation.

UNION'S ARGUMENTS:

3. 1. The discontinuance of the summer and Christmas bonus was never on the agenda during the negotiations of the 2010 agreement and remains outside its scope.

2. The Union want the outstanding payment from Christmas 2010 and July 2011 be paid to all the Workers and for it to be reinstated and paid in July and at Christmas each year.

COMPANY'S ARGUMENTS:

4. 1. The new formula for calculating payment for annual leave which includes average bonus earned, adsorbs the historical bonus which was paid at Christmas and summer.

2. Whenever the new formula results in an Employee receiving less than the historical bonus amount, the Company will make up the balance thus ensuring that no Worker would suffer a financial loss.

RECOMMENDATION:

The matters forming the subject of this referral were dealt with at conciliation in July 2010. Agreement was reached on the terms of a proposal put forward by the IRO which covered the matters now before the Court. In respect to the payment of bonus in holiday pay the parties agreed to accept the position set out by the Company in its letter to the Union dated 7th July 2008. Consequently, the dispute now before the Court concerns the interpretation of what the parties agreed in settlement of this dispute rather than the terms upon which the dispute ought to be resolved.

In interpreting an agreement the role of the Court is to establish the intention of the parties to the agreement. That intention is to be ascertained from the language of the agreement but also from the surrounding circumstances including the exchange of correspondence between the parties and the discussion between the parties leading to the conclusion of the agreement.

In that regard it is noteworthy that a central feature of the agreement concluded at conciliation was that the workers concerned would receive a pay increase. It appears reasonable to assume that in consideration of that concession the Company would seek concession of its position in relation to the matter now in issue. It is also noteworthy that in LCR 19150 the Court neither recommended that the bonus now in dispute be continued nor discontinued.

The terms of that letter of July 2008, which was incorporated in the LRC settlement, in so far as it related to the incorporation of average bonus in holiday pay, and the related issue concerning the continuance of the fixed-rate bonus, were less than clear. However in subsequent correspondence and discussions the Company's position was made clear. In particular its letter of July 2009, which was accepted, left no doubt that the fixed rate bonus would only continue to be payable where the average bonus, calculated in accordance with the formula proposed in LCR 19150 was less than the amount of the fixed rate bonus.

Consequently, when the agreement was concluded in July 2010 there could have been no doubt as to the Company's intention regarding the circumstances in which the fixed rate bonus would continue to be paid. This must have been known to the parties when they concluded the agreement. In these circumstances there is no reasonable basis upon which the Court could recommend concession of the Union's claim in relation to the payment of the fixed rate bonus.

On the second issue before the Court (the consolidation of the bonus in basic pay) the parties agreed that the pursuance of this issue would be deferred. Having regard of the lapse of time since the conclusion of the agreement of July 2010 the Court cannot recommend that the matter be reopened at this time.

For these reasons the Court does not recommend concession of the Union's claim.



Signed on behalf of the Labour Court



Kevin Duffy
28th October, 2011______________________
JFChairman



NOTE

Enquiries concerning this Recommendation should be addressed to John Foley, Court Secretary.