Deputy Tomás Mac Giolla sought to raise on the Adjournment the dispute at the Semperit Tyre Factory in Ballyfermot and the matter is in order. We have lost a little time, so the Deputy will have about 18 minutes.
Estimates, 1989. - Adjournment Debate: Tyre Plant Industrial Dispute.
Thank you. This is a matter of great importance to very many people in Ballyfermot, Walkinstown, Crumlin, Drimnagh and Inchicore from where there are 600 people employed in Ballyfermot. These people have seen very many industries shut down over recent years. Neither the people of the area nor the workforce want to see another shutdown.
In 1986 there was a similar threat of shutdown in Semperit and this caused an enormous scare in the area. The workforce were looking for compensation for changes in work practices and so on, but as a result of the threat of closure they accepted everything the company suggested. They had no option at that time. They accepted a major restructuring deal which meant job losses, changed work practices and changed working conditions at the plant. The workforce understood that if they carried out the programme schedule set down by the management, the company would be safe and that they would have a secure future. They kept their part of the bargain and increased productivity by an unprecedented 25 per cent in two years. For that increased productivity the workforce got nothing although the company had a huge gain in profits, sales and so on.
In February of this year the Tánaiste, Deputy Brian Lenihan, who is a Deputy for the area, at a reception and press conference in Semperit, announced on behalf of Semperit the great news for the workers in that company and also for the people of Ballyfermot, that an expansion in investment would lead to the creation of an additional 152 jobs by the end of this year. The funding for this expansion plan was to be from the company itself, the IDA and Fóir Teoranta but we were not told how much each contributor would put in. The investment was to be about £25 million. All we were made aware of was that the IDA were to contribute approximately £7 million. We were not told of any other conditions attaching to this expansion programme. Since then the board of the parent company of Semperit have sought major changes in the working conditions of those employed at the plant in Ballyfermot. Under the plan, production at the plant would increase from 50,000 to 85,000 tyres per week. To achieve this the workers would have to change from a three-cycle shift system over five days to a four-cycle shift system over seven days. That would make enormous changes in the lives of workers not alone because they would be working at night but because they would be working at weekends, on Sundays and so on. This would mean a change of lifestyle for the whole family.
Despite reports to the contrary in the media, especially the reports being hyped up by the IDA that the employees refused to accept the new shift system, I would emphasise that the workers did not refuse to accept the need for a new shift system. They understood the proposal and what it would do for the company and they were prepared to negotiate this new shift system. They simply sought adequate compensation for the enormous disruption that such a fundamental change would cause to them and their families, having got no compensation for previous changes in work practices which led to a 25 per cent increase in productivity. The original compensation offered by the company was a lump sum of £75, a sum that would probably not pay for the average lunch for a couple of Semperit executives. The negotiations proceeded and the matter went to the Labour Court which effectively acknowledged that the company's offer was totally inadequate. The Labour Court recommended major improvements on the company's offer. The workers felt that the Labour Court recommendation was a significant advance, but they thought that it did not go far enough for them. In particular they sought an increase in the shift premium of up to 11.25 per cent to compensate them for the disruption and changes that would be caused in their lives and for the huge increase in productivity which would arise from these changes in practices.
Up to this, the normal industrial relations process had operated. In recent months there were numerous meetings of the workers, unions and management. At all times the workforce knew what was happening and they were aware of what management were offering. The company were seeking major changes in work practices and the workers were looking for adequate compensation for the changes sought. This is a process that is gone through in scores of companies all over the country every day of the week, month and year. It is normal practice to look for compensation when changes are sought in work practices and productivity.
However, the position deteriorated prior to last weekend when the company resorted to what I can only describe as the gun to the head school of industrial relations which has developed in recent years in many companies around the country — the threat of closure when workers look for anything — but this was the second time it happened in this company. The threat was accept our offer or not only will the development plan not go ahead, but it is likely that the whole plant will be closed down and the existing workforce of 600 workers will lose their jobs. This was an unnecessary threat and a response out of proportion to the matters still in dispute. It was unhelpful that the threat was made just as the workers were about to go on their holidays.
Another unhelpful development over the weekend was the extraordinary intervention of the IDA into what is an industrial dispute. The IDA admitted that it was virtually unprecedented for them to intervene in an industrial dispute, yet despite this, the authority's chief executive, Mr. Padraic White, barged in with a series of partisan statements that can only be described as crudely pro management and hostile to the workers. Industrial relations is an incredibly delicate area and Mr. White has no competence or expertise in this area as his statements most clearly show. There was a time not too long ago when the IDA seemed to recognise the advantage of an organised workforce and the positive role the trade union movement could play when dealing with multinational companies setting up here. They have played a tremendous role in many of those companies over many years and those companies are very happy with the role the trade union movement and their workforce have played in enormously increasing their profits which they are now repatriating at increasing rates. At present almost £2 billion is repatriated each year and this figure is expected to reach £4 billion during the coming five to six years.
It seems that there has been a big shift in the IDA's attitude to the trade unions. They have now adopted an anti-trade union position. Certainly if Mr. White wanted to antagonise the workforce he could not have done better. All his criticism was directed at the workers. There was not a word of censure for the threat made by the chairman of Semperit (Ireland), Dr. Klaus Roeker, who said that if the company did not get its way it would stop every penny from Germany. He is also quoted as saying that if the workforce want to kill their jobs, okay, this is it. I know, and the IDA should know as should Dr. Roeker, that the workers do not want to kill their jobs — far from it. They have no intention of killing their jobs. They want to maintain them. It is only Dr. Roeker who spoke about killing the jobs and the closure of the factory. What the workers want is secure, reasonably paid jobs for themselves and for as many others as possible.
I do not accept that the doomsday scenario painted by some sections of the media is accurate. The parties are not that far apart. The Labour Court recommendation with some adjustments could provide the basis for a solution. Unfortunately, however, the matter is now deadlocked. The workforce are on holiday and the management have gone back to the parent company in Hanover from where the statements about the killing off of jobs were issued. Their more recent statement indicated that they were placing their offer on hold. That was a very welcome development and should be capitalised on. I presume this means that it is okay until the workforce return from their holidays and can deal with the trade unions and that there is no immediate threat of closure.
Now is the time for the Minister for Labour, who has shown his skill in a series of major political negotiations in recent weeks that must have seemed far more daunting to him than the Semperit dispute, to intervene. I think his presence at this stage is absolutely essential. With a little give and take on both sides I believe the dispute can be settled, the future of the plant secured and the jobs of the workers guaranteed. I can assure the company that their profits can also be guaranteed. They have an outstanding workforce who will return five-fold any investment put into the plant. All they require, all they have been negotiating for and all they have been working for in recent months is a reasonable return for the extra work and productivity they will achieve and from which the company will gain an enormous increase in profits — an increase from the current production of 50,000 tyres per week to 85,000 tyres per week. Out of those profits the workers want a reasonable rate of return for themselves.
I appeal to the Minister to intervene and to bring the sides together to commence further discussions. I am confident a solution can be found because they are not far apart. The Labour Court recommendation could provide the basis for a solution. I ask the Minister to ask his colleague to whom Mr. Padraic White of the IDA is answerable to call him off. Let him stick to the job he is paid to do. He should be told never to intervene in an industrial dispute because all he has done is to hype it up to the stage where it could have disastrous consequences for the workers and the plant in Ballyfermot. I ask the Minister to ensure that Mr. White never intervenes again in an industrial dispute. I appeal to the Minister for Labour who has shown his expertise in finding solutions in other disputes in the past to exercise his mind on this one and to intervene as early as possible.
I wish to thank Deputy Mac Giolla for raising this issue and giving us an opportunity to have some discussions on it prior to the Dáil recess.
First, I wish to express my grave concern that this major and important investment and expansion programme planned for the factory is now under threat. It appears also that should the planned investment not take place the future of the existing operation, as Deputy Mac Giolla has said, will also be placed in jeopardy. I need hardly emphasise the disastrous consequences, particularly in terms of the employment implications of such an eventuality, which none of us would like to see happening. Deputy Mac Giolla has given an outline of the case with which I would not disagree on factual matters.
I do not want to go into any great detail, other than to say that early in the year an investment expansion plan was announced involving the investment of £25 million and the creation of a very welcome 152 additional jobs. The plan would increase the output from 50,000 tyres to 85,000 tyres a week involving a change from a three-cycle shift system over five days to a four-cycle shift over seven days. The proposed change in the shift system was resisted initially by the workers because of the disruptive effect on their social life. I would agree with the comments made by the Deputy that that is disruptive of people's social life.
The initial decision to reject the new system was revised in the second ballot following on the announcement that the investment plans would be dropped and the plans scaled down, but the arrangements were not implemented. The acceptance in principle of the four-shift system enabled negotiations to begin on the terms for its introduction. It is now accepted on all sides that if the investment plan is to go ahead it will be necessary to switch from a three-cycle shift to a four-cycle continuous system and the problems which have arisen some people think are with regard to the cycle, as Deputy Mac Giolla said, but it centres around the offer to the workforce in return for agreement to the introduction of the new system.
The dispute over the terms for the introduction of the new system has been investigated by the Labour Court which issued its recommendations on 11 July. The recommendation which made a number of improvements on the company's offer was rejected in a ballot by the workforce.
For the information of the House, the recommendation of the Labour Court was as follows:
The Court has considered the submissions made by the parties, and in the light of the urgency with which a decision is needed recommends the following terms of settlement on the issues still outstanding.
In the first instance the Court is satisfied that the overall offer made by the company, in terms of impact upon its production costs, is very close to the maximum sustainable by it, for the time being. The Court therefore recommends:
(1) Payment of the 38 hour week to be the same as for 40 hours, i.e. the hourly rate to be adjusted by 5.26 per cent.
(2) An increase of holidays by 2 additional days.
(3) Shut-down holidays to be 3 weeks subject to detailed agreement on implementation.
(4) Service days to be paid at 12 hours.
(5) The introduction of a sick pay scheme from July, 1991.
(6) The Court further recommends that the Company amend its offer on shift premium to provide for an increase of 6.5 per cent to be introduced as follows:
Phase 1:4 per cent from the commencement of 4 shift working.
Phase 2: 2.5 per cent after 9 months.
(7) As a final amendment to the Company's proposals, the Court recommends that the lump sum offer be increased to £150.
The Court at this stage does not recommend any further changes in conditions but takes the view that when the first stages of the changes arising from the proposed investment programme have been completed that a further review of overall conditions should take place, such a review to be considered an integral part of this recommendation, and subject if necessary to a further investigation and recommendation by the Court. This review should commence in September, 1990 and should incorporate an undertaking by the Company to consolidate a sum of not less than £5 of the 27th Round flat increase into the basic rate at a date not later than 1st February, 1991 as an earnest of their willingness to share the benefits accruing from the changes which will take place.
The Court acknowledges that such a delay in obtaining these benefits may not be as attractive as further immediate improvements in income and conditions but does urge all concerned to take account of the other undoubted advantages deriving from the Company's proposal such as the enhanced security of employment, the additional employment made available, as well as the likely long term direct benefits which will accrue.
Following a meeting of the board of the parent company at the weekend it was announced by management that the terms recommended by the court would remain on offer to the workforce until after the workers' return from their annual holidays on 8 August.
In response to Deputy Mac Giolla and the other Deputies who have remained on in the House for this debate — Deputies Rabbitte, O'Sullivan, Ryan and my colleague, Deputy Lawlor — I would urge both sides to use this intervening period to re-open discussions with a view to securing agreement so that this major investment programme, which all of us in this House do not want to lose, can proceed as planned. I accept that Deputy Mac Giolla and the other Deputies are not only interested in what is there but in additional jobs as quickly as possible coming on stream. I assure the Deputies, and Deputy Mac Giolla in particular, that the services of the Labour Court are available now and will continue to be available and I am prepared to have discussions at any stage. The officers of the court will also be available if their services are required.
I agree with what Deputy Mac Giolla has said, that nobody wishes to be emotive, that we are all in the job of trying to see the creation of extra employment and that sanity will prevail in matters of industrial relations. I welcome the all-party support which I always received in this House. Industrial relations are a delicate matter, not one for shouting over the rooftops. In this House for years industrial relations have been treated on that delicate basis. I appreciate that Deputy Mac Giolla has reiterated the grounds which we follow. On that basis I would take this opportunity of emphasising, in particular, the Labour Court's recommendations that when the first stages of the changes arising from the proposed investment programme have been completed, a further review of overall conditions should then take place. That would be in September 1990. This review gives the parties the chance to evaluate the situation in just over a year from now.
There, I believe, lies the solution to and the grounds for the commencement of discussions and a homing in on the point which the court has raised about this new plan being very close to what is viable for the company but, equally, on the point of the disruptive effect for the workforce. Matters should be allowed to proceed on the basis of the court's recommendations and at the end of the first phase there should be a further review. With the support of the House I would ask both sides between now and 8 August — and sooner rather than later — to recommence discussions. The senior officers of the court are available to assist at whatever hour or day it is wished that discussions be commenced. There should not be any delay. There is not a big difference involved. There are grounds within the recommendations for negotiation, and that opportunity should be used. This debate tonight has been useful in allowing us to appeal to all involved. I thank the Deputies who have remained to listen to this debate and ask both sides to consider what we are saying.
The Dáil adjourned at 9.30 p.m. until 10.30 a.m. on Wednesday, 19 July 1989.