FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 13(9), INDUSTRIAL RELATIONS ACT, 1969 PARTIES : AER LINGUS - AND - A WORKER (REPRESENTED BY SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION) DIVISION : Chairman: Ms Jenkinson Employer Member: Ms Cryan Worker Member: Mr Shanahan |
1. Appeal of Rights Commissioner's Recommendation R-147307/147308-IR-14/RG.
BACKGROUND:
2. The case concerns a claim by the union on behalf of two employees concerning the non-payment of a Long Service Increment (LSI) having completed 20 years service.
- This matter was referred to a Rights Commissioner for investigation and Recommendation. On the 3rd February 2015 the Rights Commissioner issued the following Recommendation:-
- 1. Red Circling is a common feature in any industrial relations environment. It has two basic concepts - (i) it protects the current salary of the employees which is usually higher than equivalent employees doing the same or similar work and (ii) it restricts progression through the incremental pay scale by the red-circled employees until such time as their peers in the same or similar grade and service have attained the red-circled salary of the protected employees.
2. Both Claimants are currently on an annual salary of €40,879, after 20 years service. The Maximum of their current Operative C Grade after 35 years service is €41,606 per annum.
3. Essentially what the Claimants are seeking is that because they have completed 20 years service with the Company they should be paid an LSI, which would effectively bring them over the Maximum point of their current Grade of Operative C. This would defeat the whole basis of red circling which in the first instance is to protect the employees who are red-circled and ensure that their salary is protected but also it restricts progression through a salary scale until such time as their peers of similar grade and service have caught up with their red circled salary. Red circling does not provide that red-circled employees continue to progress on the salary scale or receive increments the end result, which would be that their peers would never catch up with them.
On the basis of my findings above I do not recommend that the two Claimants should be paid an increment after 20 years of service.
- 1. Red Circling is a common feature in any industrial relations environment. It has two basic concepts - (i) it protects the current salary of the employees which is usually higher than equivalent employees doing the same or similar work and (ii) it restricts progression through the incremental pay scale by the red-circled employees until such time as their peers in the same or similar grade and service have attained the red-circled salary of the protected employees.
A Labour Court hearing took place on the 23rd April, 2015.
WORKER’S ARGUMENTS:
3. 1. Both Workers were entitled to their 20 year LSI in 2010.
2. LSI's are an award for service and operate independently of pay scales. A Worker does not have to be at the top of the scale to receive an LSI.
3. The Workers do not know when they will receive an LSI.
COMPANY'S ARGUMENTS:
4. 1. When the Workers had their pay red circled in 2005 it was agreed that their salaries would be frozen until such time as the salaries of their peers were brought into line with their own.
2. As the Workers are in receipt of salaries in excess of the relevant 20 year LSI rate they do not have an entitlement to the LSI.
3. When the Workers have 35 years service they will receive the appropriate LSI rate for 35 years service.
DECISION:
This is an appeal by the Union on behalf of two named employees against a Rights Commissioner’s Recommendation which found against their claim for application of a Long Service Increment (LSI) having completed 20 years’ service.
The Claimants were transferred from the Cargo Department to Loading Section in October 2005 to an Operative A position however, they retained their higher Cargo Agent 111 grade salary scale on a ‘red-circled’ basis. Subsequently they progressed to the grade of Team Member C with their salaries benchmarked with the Operative C grade. They claimed payment of the LSI appropriate to the Operative C grade when they had completed 20 years’ service. Management rejected the claim on the basis that they were already in receipt of salaries above the rate paid to their grade and service peers in Ground Operations.
The red circling agreement reached in 2005 on behalf of the Claimants stated that there would be no change in their current basic salary on the Operative A scale, which was at the time above the 22ndpoint of the scale. Therefore it stated as follows:-
- “As your salary is above those of Operative staff with equivalent service, it will be frozen until such time as these salaries are brought in line with your own.”
The Union submitted that the Claimants were entitled to receive an LSI having completed 20 years’ service as both were at the maximum of the scale when they were red circled and now that they have aquired 20 years’ service they were entitled to the LSI as it contended that LSI’s operate separately from pay scales.
Having considered the submissions of both parties the Court understands that red circling has a meaning whereby the protected employee ‘marks time’ until his/her peers catch up. In this case both Claimants’ salaries are within the Operative C scale, just below the 35 years’ service LSI point. When they reach 35 years’ service they will be paid the appropriate rate for an LSI after 35 years.
In support of its contention, the Union referred to a third employee who similarly transferred in October 2005 and included in a similar red circling agreement, who was paid an LSI after 20 years. The Court notes that when he was red circled he was at a point within the scale, which was below the 20 years’ service LSI point and therefore on achieving the 20 years’ service he was eligible for the LSI.
The Court finds that as the Claimants are already in receipt of a salary above the value of the LSI after 20 years’ service on the Operative C scale that they have no entitlement to the LSI, and accordingly rejects the appeal and upholds the Rights Commissioner’s Recommendation.
The Court so Decides.
Signed on behalf of the Labour Court
Caroline Jenkinson
COR______________________
11th May 2015Deputy Chairman
NOTE
Enquiries concerning this Decision should be addressed to Clodagh O'Reilly, Court Secretary.