FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : KEELINGS DISTRIBUTION LIMITED - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Ms Cryan Worker Member: Ms Ni Mhurchu |
1. 6% increase in Basic Pay
BACKGROUND:
2. The Company operates and manages the warehousing in a distribution centre in Ballymun to service Tesco stores with chilled/frozen and fresh produce. The operation is under a management contract. The Union is seeking application of a 6% pay increase that fell due in 2009 - 3.5% in April and 2.5% from October, 2009. The Union claims that the payments were deferred due to the 9 Point Plan Agreement concluded by the parties in March, 2010. It further claims that the Agreement acknowledged that the monies were outstanding and provided for a review in the first quarter in 2011. The Company's case is that it cannot afford to make any payments in the current climate. In fact it is seeking ways with the Union to make cost reductions. Attempts with an independent facilitator to resolve the issue were unsuccessful.
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 27th May, 2011, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 21st October, 2011.
UNION'S ARGUMENTS:
3. 1. The 2010 Agreement was concluded on the basis of securing jobs on the Ballymun site. It contained a number of efficiencies and cost-saving measures including a rate of pay for new entrants which has proved to be hugely contentious on site. The Agreement contained the facility to review the outstanding pay increase in the first quarter of 2011.
2. Tesco, which is the paymaster for Keelings, continues to make huge profits in the Republic of Ireland. The Company has had declining labour costs since March 2010. The workers have honoured their side of the Agreement and should be rewarded accordingly.
COMPANY'S ARGUMENTS:
4. 1. At no stage did the Company concede that a review would result in a pay increase as the prevailing circumstances would have to be taken into consideration.
2. Competitiveness has become vital for maintaining employment in the current times. Part of the 2010 Agreement included a new pay rate for new entrants which has helped to underpin the viability of the Ballymun site. The Union's claim for a 6% pay increase is not sustainable as the Ballymun distribution centre compares unfavourably with other centres which are part of the customer's supply chain network.
RECOMMENDATION:
The Court accepts that the language used by the parties at Clause 1 of the Consolidated Agreement of 5th March, 2010, could have given rise to an expectation that the increase in issue would be addressed in 2011. It is clear, however, that the wording of the Clause did not commit the Company to conceding the increase.
Having regard to all the surrounding circumstances of this case the Court does not recommend concession of the Union's claim at this time.
The Court does, however, recommend that the Union's claim should be addressed, through the process provided for in the Agreement, in the first quarter of 2012. In that review, regard should be had to all relevant considerations, including the then prevailing economic circumstances of the employment, any relevant protocol in force between ICTU and IBEC and wage movement in comparable employment.
Signed on behalf of the Labour Court
Kevin Duffy
28th October, 2010.______________________
CON.Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Ciaran O'Neill, Court Secretary.