FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : OXIGEN ENVIRONMENTAL LTD (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Ms Doyle Worker Member: Ms Tanham |
1. Pay Cuts
BACKGROUND:
2. This dispute concerns pay reductions sought by the Company. This dispute could not be resolved at local level and was the subject of a number of Conciliation Conferences under the auspices of the Labour Relations Commission. As agreement was not reached, the dispute was referred to the Labour Court on the 17thJuly 2012, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 2ndAugust, 2012.
UNION'S ARGUMENTS:
3 1 The Union at all stages throughout this process cooperated with Management in trying to achieve reductions in a structured way using the Procedures.
2 It was made clear to the Company on many occasions that the failure to deal with the previous 5% pay cut would represent major difficulties for the Union.
3 The Union was always willing to examine any proposal over any reasonable timescale that would reinstate all the pay cuts.
COMPANY'S ARGUMENTS:
4 1 The parlous state of the company finances was well recorded in the Consultants report
2 The cash reserves of the Company are being increasingly depleted
3. The Company moderated its original cost saving plan in the conciliation conference negotiations, so that only 80% of the original savings was included in the LRC proposal.
RECOMMENDATION:
- The Court notes that the independent assessment undertaken of the financial circumstance of the Company confirm that pay reductions of the magnitude proposed are necessary so as to protect the viability of the business and the employment that it sustains. It is further noted that while the Union have not agreed to the reductions they recognise the validity of the economic arguments relied upon by the Company in support its position.
The Court was told that the reductions in issue have already been implemented notwithstanding a requirement in the procedural agreement between the parties to process issues in dispute through normal dispute resolution procedures, including the Court. In this case the Court facilitated the parties with an early hearing (within two weeks of the referral) and the Court can see no justifiable reason as to why the Company found it necessary to act unilaterally rather than awaiting the Court’s recommendations.
This proposal to reduce pay comes against the background of an earlier reduction involving some but not all of those affected by the current proposal. In the case of the earlier reduction there is conclusive evidence that the Company undertook to review the position regarding the earlier reductions and that no such review was undertaken.
Having regard to the independently assessed financial information now before it, and noting the position of the Union, the Court recommends that the proposals which emanated from conciliation be accepted with the following modification:- 1.For the reasons referred to above the reductions should now be agreed and should take effect only from the date of this Recommendation.
- 2.The reduction now in issue, together with the earlier reductions, should be regarded as a derogation from the agreed rates and should remain in place for no longer that is justified by the economic and commercial circumstances of the employment.
- 3.Those economic and commercial circumstances should be jointly reviewed periodically by the parties and if and when those circumstances improve sufficiently both the current and the earlier reductions, in respect of those to whom they applied, should be restored.
Signed on behalf of the Labour Court
Kevin Duffy
3rd August 2012______________________
C.RChairman
NOTE
Enquiries concerning this Recommendation should be addressed to Ciaran Roche, Court Secretary.