FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : KILLARNEY GOLF CLUB - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Ms Doyle Worker Member: Mr Shanahan |
1. Change proposals
BACKGROUND:
2. This dispute relates to cost cutting measures proposed by Management which they claim are needed to ensure the long term viability of the Club. This dispute could not be resolved at local level and was the subject of a Conciliation Conference under the auspices of the Labour Relations Commission. As part of the Labour Relations Commission conciliation process Mazras were appointed as financial assessor jointly by SIPTU and Killarney Golf Club Limited As agreement was not reached, the dispute was referred to the Labour Court on the 26th January 2013 in accordance with Section 26(1) of the Industrial Relations Act, 1990.
A Labour Court hearing took place on the 14th March 2013.
UNION’S ARGUMENTS:
3. 1. The comparators used by the Employer do not hold major tournaments similar to those held by the Killarney Club.
2. Substantial savings have been made including a 5% pay cut for staff, savings to printing and stationery costs and the bank loan and overdraft have been cleared.
3. The redundancy package offered in April 2012 of four weeks’ pay per year of service should be offered to staff and only on a voluntary basis.
EMPLOYER'S ARGUMENTS:
4. 1. The Club has incurred heavy trading losses for the past five years. In 2012 the Club engaged Deloitte to review the current financial, organisational and market position of the Club.
2. In November 2012 all credit facilities were ceased and withdrawn and will not be restored.
3. The Club cannot pay the previous offer of four weeks redundancy and requires significant reduction to staffing levels and pay going forward.
RECOMMENDATION:
The Court has considered the submissions of the parties and it has also carefully reviewed the independent financial assessment of the company undertaken by Mazars.
The Company is seeking to reduce its payroll costs by a combination of cuts in rates of pay, elimination of bonuses and allowances and redundancies. It is noted that a set of proposals to resolve the dispute were formulated with the assistance of the LRC. While the details of the proposals were not furnished to the Court it was informed that they were rejected by the Company. The Court was also informed that the reason for the rejection was that the proposals provided for ex-gratia redundancy payments and involved the retention of staff in major loss making areas.
Apart from the meeting which produced those rejected proposals there appears to have been little constructive engagement between the parties. The Company’s position is that it requires full implementation of its proposals. Those proposals, if implemented, will involve substantial changes to a long standing collective agreement between the parties leading to significant reductions in earnings for the Union’s members, compulsory job losses and the payment of statutory redundancy only. For its part the Union’s stated position is that it is not prepared to conclude an agreement with the Complainant along the lines proposed. The Court has not been provided with details of the rejected proposals and therefore has no idea of the degree to which the negotiators on each side were prepared to moderate their respective positions.
At the request of the LRC, Mazars were appointed to conduct a financial assessment of the Company. The outcome of that assessment only became available on the day before the scheduled hearing before the Court. It is noted that the assessor has made proposals on how the Company’s current difficulties could be addressed. There have been no discussions between the parties on the content of the assessor’s report . Furthermore, due to the timing of the report’s publication its content was not addressed in any meaningful way in the formal submissions made to the Court.
Against that background and in particular having regard to the polarised positions taken by the parties at the hearing, the Court is of the view that any definitive recommendations that it could make at this time would be unlikely to advance the resolution of the dispute. Further engagement is plainly required between the parties. Even if the dispute cannot be resolved some degree of commonality will have to be developed on how the underlying difficulties being experienced by the company can be addressed. The parties will also have to consider and respond to the Mazars report and in particular the proposals contained therein on how the Company’s difficulties might be addressed.
In all the circumstances the only recommendation that the Court can make at this time is that the parties return to conciliation and that they make a final and determined effort to resolve the dispute or if that is not possible to narrow the gap that currently exists between them.
By way of guidance in those discussions the Court wished to express its opinion that the Union should accept that the payroll costs of the company will have to be rebalanced relative to its income and this will involve some adjustments to existing pay levels. It is also clear to the Court that a significant number of redundancies will have to be considered. On that point the Court notes that the Company are now unwilling to offer ex gratia payments as part of a redundancy package. In the Court’s opinion the Union’s position on that question does not appear to be unreasonable or out of line with what might be expected elsewhere in similar circumstances. Agreement is unlikely unless the Company can find the means to alter its current stance in that regard.
The Court recommends that the parties should request the Labour Relations Commission to facilitate them with the earliest possible date for a resumed conciliation conference. If agreement is not reached the Court will make itself available at short notice to resume the hearing. At any such resumed hearing the Court will expect to have the normal report of the conciliation office available to it for consideration. It will also expect comprehensive submissions on the content of the Mazars report.
Signed on behalf of the Labour Court
Kevin Duffy
CR______________________
19th March, 2013Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Ciaran Roche, Court Secretary.