FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : REHAB GROUP (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Ms Doyle Worker Member: Ms Ni Mhurchu |
1. Hearing arising from LCR19945.
BACKGROUND:
2. The case before the Court concerns a dispute between the Employer and the Union in relation to issues arising from Labour Court Recommendation No.19945 where previously the Court recommended that the Union nominate an independent body to carry out a financial review of the Organisation and furthermore in line with the outcome of such review being undertaken, to re-evaluate the factors outlined by the Organisation as reasons given for the pay cuts previously imposed. The Court also invited the parties to return for a further hearing in the case of any outstanding unresolved issues remaining. Following LCR19945, an independent review of the Organisation's financial position was carried out and a report was issued. Further local level discussions took place however agreement could not be reached between the parties.
The dispute was referred to the Labour Court on the 8th August, 2011, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 20th December, 2011.
UNION'S ARGUMENTS:
3. 1. The Union contends that the pay cuts imposed on its members could have been avoided and maintains that the results of the financial review undertaken support this argument.
2. The Union is seeking compensation for loss of earnings and further contends that the Organisation is in a financial position to pay compensation to its members.
3. The Union is of the view that despite the current economic climate the Organisation remains financially successful and that this manifests itself in investments and spending made by the Organisation since the imposed pay cuts.
EMPLOYER'S ARGUMENTS:
4. 1. The Employer asserts that the necessity to implement pay cuts has been substantiated in the report issued following the financial review.
2. The Organisation is continually subjected to funding cuts made by the Health Services Executive and contends that the pay cuts carried out were a necessary means of absorbing losses incurred by funding cuts.
3. The Employer maintains that it is in an ever weakening financial position and is unable to concede to the Union's cost-increasing claim for compensation.
RECOMMENDATION:
While those associated with this claim do not have pay parity with employments covered by the Financial Emergency Measures in the Public Interest (No.2) Act 2009, they do have a clearly established pay relationship with such employments. On foot of that pay relationship the Claimants benefitted from pay adjustments arising from the Benchmarking Exercise in the public service. The practical effect of the pay reductions introduced in Public Sector employments, covered by the emergency legislation of 2009, has been to substantially offset the increases provided by benchmarking. Since the employer in this case paid the benchmarking increases, there is merit in their claim that downward pay adjustments in the public service should likewise apply.
Moreover, it is clear from the independent report on financial circumstances of the employer that the reductions in issue are necessary to maintain the viability of the Organisation and the employment which it provides.
However, as found by the Court in Recommendation LCR19945, the pay adjustments in issue were introduced without proper or adequate utilisation of normal industrial relations procedures. In these circumstances the Court recommends that the adjustments be accepted by the Union, but that they take effect from October 2010. The pre-reduction rates should apply up to 30th September 2010 and the appropriate retrospective payments should now be made.
Finally, the Court notes the Union's contention that more adequate consultation/negotiation procedures should be put in place within this employment and that the employer is not adverse to that suggestion.
The Court further recommends that the parties should now engage at local level to address this matter.
Signed on behalf of the Labour Court
Kevin Duffy
9th January 2012______________________
SCChairman
NOTE
Enquiries concerning this Recommendation should be addressed to Sharon Cahill, Court Secretary.