LCR20592

SUBJECT:
1. Loss of earnings.


BACKGROUND:

2. The Company is a subsidiary of the Japanese multinational Astellas Pharma Incorporated and is based in Killorgan, Co. Kerry since 1992, it currently employs almost three hundred workers. The case before the Court concerns the loss of earnings as a result of movements off shift and the basis of their selection which was not discussed or agreed with the Union by Management. A compensation claim for income loss due to the shift changes was rejected by Management who claim that they have never paid compensation in similar circumstances and it would be adding costs in return for a flexibility which they claim has always existed.

The 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 agreement was not reached, the dispute was referred to the Labour Court on the 12th April, 2013, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 29th August, 2013.


UNION'S ARGUMENTS:

3. 1. The selection for shift moves of a permanent nature should be based on length of service all things being equal and a two year compensation formula be applied for losses of a regular and rostered nature.

2. The selection for shift moves of a temporary nature could be addressed by a step-down arrangement along industry norms.


COMPANY'S ARGUMENTS:

4. 1. The plant produces one product which last year went off patent and this necessitated changes in shift patterns for the Workers as the Company requires specific skill mix for the rebuilt teams.

2. The Company recognises that many of the Workers had enjoy particular shift patterns for many years, but due to the current need to contain costs it is not in a position to pay compensation for shift changes.

RECOMMENDATION:

The issues before the Court concern loss of earnings as a result of movements off shift and selection of employees for shift moves. The Union submitted three claims:

• i.Selection for shift moves of a permanent nature should be based on service where the skill sets of the employees on shift are equal.
  ii.The industry norm of two years’ compensation should be applied for permanent loss of regular and rostered shift premium.
  iii.A step-down arrangement should be put in place for shift moves of a more temporary nature.

The Union submitted that it is the norm in industry to pay compensation for permanent loss of shift earnings. It stated that the Company has paid compensation of two years’ loss of earnings in the past when it permanently removed the PRP payment system. The Union referred to similar type organisations with step down arrangements in place which apply where employees temporarily move from a higher shift to a lower shift and from shift to day working.

The Company rejected the claims for compensation/step-down arrangements on the basis that moves between shift has been a regular feature of the business for over 20 years; such interchangeability and flexibility is specifically provided for in the contracts of employment; the shift premia applicable in the Company are higher than the norm to reflect the interchangeability requirement and compensation has never been paid for such moves.

Having considered the positions of both sides the Court notes that both the Company and the Union are willing to explore the issue of selection for shift moves where it is envisaged that it will be long term. The Court recommends that such discussions should take place at local level, taking account of employee’s length of service and in the context of the correct skill mix being available to the Company.

From the information provided to the Court it would appear that it is common practice in the Company for employees to be moved between shifts and from shift to day working, therefore the Court does not recommend the introduction of a step-down arrangement.

However, in situations where the Court is presented with claims in respect of permanent loss of shift earnings as a result of being permanently moved off shift, it has traditionally recommended in favour of compensation for such loss of shift earnings. The Court is satisfied that this is not the case in this Company at present. Therefore the Court sees no reason to recommend a compensatory formula at this point. In the event that circumstances change and the Court is presented with facts which suggest that any loss of shift earnings will be of a permanent nature then the Court is prepared to revisit the issue.

The Court so recommends.



Signed on behalf of the Labour Court



Caroline Jenkinson
23rd September, 2013______________________
JFDeputy Chairman



NOTE

Enquiries concerning this Recommendation should be addressed to John Foley, Court Secretary.