FULL RECOMMENDATION
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : IRVING OIL WHITEGATE REFINERY LTD (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - UNITE DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Murphy Worker Member: Ms O'Donnell |
1. Claim for local bargaining increases in addition to merit pay.
BACKGROUND:
2. This dispute could not be resolved at local level and was the subject of a Conciliation Conference under the auspices of the Workplace Relations Commission. As agreement was not reached, the dispute was referred to the Labour Court on the 17th June, 2017, in accordance with Section 26(1) of the Industrial Relations Act, 1990. Labour Court hearings took place on the 19th of October, 2016 and the 28th March, 2017.
UNION'S ARGUMENTS:
3.1. The outstanding element of the Aylward Report should be implemented and the rating of those who participated in limited industrial action in 2014 should be reversed with the relevant pay adjustments applied.
2. Pay increases applied to members should be revised to ensure that they have all received a minimum pay increase of 2% per annum for each of the years 2014 to 2016 in line with the established agreement.
3. Future pay agreements from 2017 should include minimum cost of living increases at the level agreed for other employees of the organisation.
EMPLOYER'S ARGUMENTS:
4.1. The Hay Agreement replaced the previous collective bargaining arrangements.
2. The issue has been the subject of evaluation by an agreed third party. The Union are now seeking to revisit the terms of a collective agreement already reached between the parties.
3. From 2010 to 2014 Unite members have enjoyed increases totalling 14% while over the same period inflation has run at roughly 3.7%
RECOMMENDATION:
The matter before the Court concerns the Union’s claim that for the years 2014 to 2016 the employer had failed to adhere of the terms of a Pay Agreement negotiated and agreed in 2000 which replaced the previous collective bargaining system.
The 2000 Pay Agreement introduced a Hay reward system to measure the gap between the Company’s salaries and those of similar industries in Ireland. This arrangement took account of national wage agreements in measuring the budget for pay increases each year which were applied on a merit system. With the demise of national wage agreements in 2010 the gap has been dealt with entirely by merit.
The Union submitted that a certain number of its members should have received a minimum of 2% salary increases per annum to reflect cost-of-living increases in the years 2014 to 2016. The employer disputed the Union’s contention and held that there was no justification for further pay adjustments as the increases paid were in accordance with the provisions of the 2000 Agreement.
In March 2015, with the assistance of the WRC, the dispute between the parties was the subject of expert evaluation by an agreed third party, Dr Brian Alyward. He found that the Company applied salary increases in line with the Agreement for the years 2011 to 2014. In respect of the issue of a decrease in the bonus payable in 2014 as a result of industrial action he recommended that as a gesture of goodwill that the employer make the appropriate adjustments to the rating and payment of the Variable Cash Incentive Program (VCIP).
The Court notes that there have been extensive discussions on this dispute and the remaining issues at this point relate to (i) implementation of the above recommendation by Dr Alyward regarding the outstanding payment in respect of the VCIP; (ii) pay increases for the years 2014 to 2016 where a certain number of employees did not receive a minimum payment of 2% per annum for each year; and (iii) the mechanism for future pay increases.
Having considered the submission of both parties the Court recommends that (i) the recommendation of Dr Alyward should be implemented and the employer should pay the gesture of goodwill payment on acceptance of this Recommendation; (ii) without prejudice to the terms of the 2000 Pay Agreement and in recognition of the transition from national wage agreements to merit only, the employer should pay those Union members whose pay increases were less than 2% for each of the years 2014 to 2016 a payment to bring those increases up to 2% for each of those years; and (iii) for the future the parties should apply the Hay Merit System process as per the 2000 Pay Agreement.
The Court so Recommends.
Signed on behalf of the Labour Court
Caroline Jenkinson
31th March 2017______________________
JKDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Jason Kennedy, Court Secretary.