FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : MSD RATHDRUM - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Murphy Worker Member: Ms Tanham |
1. Competitiveness Programme.
BACKGROUND:
2. The case before the Court concerns a dispute between the Employer and the Union on behalf of approximately 89 of its members currently employed in various roles within the Company's pharmaceutical manufacturing plant located in Rathdrum, Co Wicklow. The dispute relates specifically to outstanding unresolved issues following proposals offered by the Company as part of its ongoing cost-saving initiative known locally as the "Rathdrum Competitiveness Programme". The Employer contends that in order to gain and sustain competitive advantage in the marketplace, a number of cost-saving measures and changes in work practices are necessary. The Employer prepared a plan and put forward proposals as to how the required objectives could be achieved. In return for acceptance of the plan the Employer offered a pay increase and compensation for any loss of earnings incurred following implementation of its proposals. The Union, on behalf of its members, rejected the Employer's proposals and agreement could not be reached between the parties. The dispute was the subject 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 1st August, 2012 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 23rd August, 2012.
UNION'S ARGUMENTS:
3. 1. The changes sought by the Employer are significant and greatly impact on current work practices.
2. The Union is seeking an augmented pay increase over and above the offer put forward by the Employer in return for the implementation of the changes required.
3. The Union asserts that the Employer remains profitable and is in a financial position to offer a higher pay increase.
EMPLOYER'S ARGUMENTS:
4. 1. The Employer contends that the changes required represent normal ongoing change and are necessary in order to remain competitive.
2. The Employer is of the view that the further increase sought by the Union greatly exceeds industry norms.
3. The Employer maintains that the proposals offered to the Union are fair and reasonable in all the circumstances.
RECOMMENDATION:
The issue before the Court concerns the outstanding issues concerning the Company’s cost competitiveness plan entitled “MSD Ireland – Rathdrum Competitiveness Programme 2011 – 2013”. The Union submitted that there were three outstanding issues which remained unresolved following a lengthy negotiation process on the plans. These related to (i) the proposed increases in pay in return for the plan; (ii) the issue of the waste handling function and the Company’s intention to outsource this function; and (iii) the Union’s requirement for a safeguard in respect of any future plans to outsource the Company’s functions.
Having considered the submissions of both parties the Court notes that the proposals which emerged from the negotiation process were reached following a very lengthy process involving twelve separate engagements including two Conciliation Conferences between 19thOctober 2011 and 6thJuly 2012. The Court is satisfied that that process took account of both sides’ concerns to a very large extent and notes that the proposals which emerged were in the main acceptable to both sides.
Pay Increases
The Court is of the view that the proposed increases in pay, plus additional voucher payments, in return for acceptance of the Company’s cost competitiveness plan are fair and reasonable and in all the circumstances there is no justifiable basis upon which the Court can recommend that they be improved.
Outsourcing the Waste Handling Function
The Company stated that as part of its corporate plan the plant in Rathdrum was required to subcontract out its waste handling function as it was not part of its core work. The Union objected to this proposal and sought to retain waste handling as currently undertaken by Warehouse Operatives.
The Court notes that clause 2.2.4 of the Company/Union Agreement provides that the Union recognises that the Company has the sole and exclusive right to schedule, assign work and subcontract work as necessary. Accordingly, the Court accepts that the Company’s proposal to deploy one additional Indaver worker to the waste handling function is in line with its existing Company/Union Agreement.
Future Plans to Outsource
At the hearing before the Court the Union raised the concerns and fears of its members concerning the issue of outsourcing, it considered it a threat to all jobs its members perform on site and in particular it raised fears that this may lead to further redundancies among the workforce. The Company stated that it was committed to protecting direct (SIPTU) employees in the event of any future redundancies.
On that basis the Court recommends that the wording included in the proposals should be amended to state the following:
- In the event of any consideration being given by the company to “outsourcing” of work carried out by SIPTU members, the company must engage with the Union with a view to reaching an agreement before any future outsourcing decisions are taken.
In the circumstances, with the inclusion of the above amended wording, the Court recommends that the Company’s proposed cost competitiveness plan as revised by the Labour Relations Commission Proposal of 6thJuly 2012 “MSD Ireland – Rathdrum Competitiveness Programme 2011 – 2013” should be reconsidered by the Union and accepted.
The Court so recommends.
Signed on behalf of the Labour Court
Caroline Jenkinson
29th August 2012______________________
SCDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Sharon Cahill, Court Secretary.