Tic Tac maker Ferrero Ireland says overtime claim would cost €1.1m
At the Labour Court, the Cork-based Ferrero Ireland Ltd said the company has lost orders and has had to action a headcount reduction. In the case, 24 craft workers - represented by the Connect union - are seeking that overtime be paid at shift rate rather than basic rate.
In its argument before the Labour Court, Ferrero Ireland stated that it is not in a financial position to implement the change requested by the union as this would significantly increase labour costs across the site at a time of decreased demand.
The company - represented by Ibec at the Labour Court - argued 'that they cannot jeopardise the overall site by bringing about significant costs'.
The most recent accounts filed by Ferrero Ireland Ltd show that pre-tax profits increased by 27% to €3m as revenues rose by 13% from €35.5m to €39.9m in the 12 months to the end of August last.
The company paid out a €2m dividend last year and this followed a €6m dividend in the prior year. Average numbers employed last year stood at 317. Staff costs totalled €19.2m.
On behalf of Ferrero Ireland, Ibec stated that while only Connect are making the claim there is another union on site who have placed the company on notice that they will be seeking this change as part of the next collective agreement.
Ferrero Ireland stated that its review of what the change would cost showed it would add an additional overtime cost of €1.1m, based on the current quantum of overtime.
In response, Connect submitted that it is the industry norm that overtime is paid at shift rate of pay and not basic rate.
Connect stated that Ferrero Ireland has sought to rely on a no cost increasing clause in the overall pay agreement despite having agreed to this issue being processed outside of the pay agreement.
Connect stated that it is their belief that paying overtime at shift rate is standard practice in the industry and they cited various examples from the food and drinks sector who are applying it.
The union also stated that having agreed to separate out the issue of shift payment it was not acceptable that the employer was now trying to hide behind a clause in the agreement they had sought to extract this claim from.
Connect stated that overtime within the plant is at the discretion of management so they can control the cost to the business.
In response, deputy chair at the Labour Court, Louise O'Donnell recommended that the parties have further local engagement on the issue and identify possible savings that could be off set against the cost of the change, with a view to finalising this issue as part of negotiations for the next pay round.
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