Around 150 workers at Dublin-based packaging firm Smurfit Kappa Dublin are to receive a pay increase after a Labour Court recommendation.
Last January, the firm failed to provide the 2% increase to workers in spite of an agreement in place that the award would be made.
The firm told the Labour Court that it was no longer in a position to pay.
At the Labour Court hearing, Smurfit Kappa said that the withdrawal of the percentage rate increase by the company is regrettable but unavoidable given the market circumstances.
The firm told the Labour Court that since the economic downturn in 2008 volumes at the plant have reduced by 18% and this was in spite of the consolidation and rationalisation of other Smurfit Kappa facilities and transfer of work to the Ballymount plant.
However, unions in the dispute, SIPTU, the TEEU and UNITE pointed out that in 2009, the company withdrew from the T2016 Pay Agreement with 6% outstanding.
The unions secured agreement from the members to postpone their 6% expectation in order to secure a guarantee of no pay cuts for 2011/11 and a similar proposal was agreed in 2012.
When the 2013 agreement came up for negotiation the union members agreed to defer a rise on foot of a guarantee of 2% on January 1, 2014.
That increase was not implemented and the dispute went to the Labour Relations Commission (LRC) before being referred to the Labour Court.
The Labour Court found “that agreements freely entered into should be upheld save in exceptional circumstances,” adding “in this case, while the circumstances have changed, they have not changed to the extent that would justify the setting aside of the pay agreement freely entered into by the parties”.
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