FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : MEDITE IRELAND LTD (REPRESENTED BY IBEC) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION TECHNICAL, ENGINEERING AND ELECTRICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Ms Cryan Worker Member: Mr McCarthy |
1. Pension Issues.
BACKGROUND:
2. The case before the Court concerns a dispute between the Employer and the Unions in relation to pension issues. The Company's Defined Benefit scheme is currently experiencing a significant funding deficit which the Employer is not in a position to fund. There is an urgent requirement for the pension trustees and the Employer to make a funding proposal to the Pension Authority to fund the current deficit. Management recognises that the funding proposal results in a significantly higher level of contribution required from members however it is not in a position to maintain the costs of the scheme in its current form. It is the Union's position that while it accepts the current situation of the pension issue, the current funding proposal is unacceptable to its members and is seeking a revision of the funding proposal in its totality.Following lengthy discussions 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 9th December, 2014, in accordance with Section 26(1) of the Industrial Relations Act, 1990. Labour Court hearings took place on the 14th of January, 2015 and the 11th March, 2015.
RECOMMENDATION:
The Court considered the submissions made by the parties in the course of two hearings and has also had the benefit of meeting with all parties in side sessions for the purpose of exploring various aspects of the dispute more fully.
The Court accepts that for all of the reasons outlined in the course of the hearings there is no viable alternative to the Company pension proposal. However, the Court is satisfied that the impact of the proposal on members of the scheme is capable of some amelioration. With that in view the Court makes the following recommendations
1.Retirement Age
Except where individuals opt to remain in employment to that age, the proposal to fix normal retirement age to 66 should be deferred for five years, at which time the situation should be reviewed in light of the circumstances then prevailing.
2.Pension Contributions / LCR 20106
It is noted that, by agreement, the 2.5% pay increase recommended by the Court in LCR20106 was to be used to provide additional funding to the pension scheme. However, that arrangement has resulted in certain anomalies which have become more pronounced in the context of the current proposal.The Court recommends that the 2.5% increase should now be paid to all employees encompassed by Recommendation LCR20106 with effect from the date of acceptance of this recommendation and that with effect from the same date the mandatory member’s contribution be increased by 2.5% of pensionable pay (making a total mandatory members contribution of 7.5%). The Court does not recommend any change in the Company’s proposal concerning the optional additional 1.5% members’ contribution. The additional cost of implementing this recommendation should be absorbed by the Company.
Signed on behalf of the Labour Court
Kevin Duffy
27th March 2015______________________
SCChairman
NOTE
Enquiries concerning this Recommendation should be addressed to Sharon Cahill, Court Secretary.