IAC rules in favour of Singapore Refinery Company in pay dispute with staff

The Industrial Arbitration Court (IAC) has ruled in favour of Singapore Refining Company (SRC), in an 18-month dispute over salary structure and service increments between the company and its staff. 

The judgment for the Singapore Refining Company Employees' Union (SRCEU) case was delivered by the President of the IAC, Chan Seng Onn, on Friday.

The union wanted service increments for 2011 to increase by 5.5 per cent and an additional S$38. 

The IAC decided on 5 per cent plus $15. 

As for the salary range increase, the union asked for an increase of 5 per cent. 

The IAC ruled that the increase will be 3 per cent. 

However, the IAC ruled in favour of locking in 6.5 months bonus as a fixed component for the total annual package of SRC workers, even though it did not order the base wage to increase as submitted by the union during the hearings. 

For the union, this means greater clarity in the size of the bonus for rank and file workers, in both good and bad times. 

In addition to this 6.5 months, workers are still entitled to a variable bonus opportunity of up to another 6 months. 

The IAC supported the union's submission to have more fixed and less variability for rank and file workers. 

It also affirmed to give the workers who have reached the ceiling the entire amount of the increment for the year in the form of a one-off lump sum payment. 

Mr Patrick Tay, Director of Legal Services Department of the National Trades Union Congress expressed disappointment with the IAC decision on the increment amount and salary range increase. 

But he said the fixing of 6.5 months (Annual Wage Supplmemt inclusive) into the workers' fixed annual package is a great win. 

He described it as a strong signal to other companies to bear in mind the imperative to maintain a higher fixed portion (70 per cent fixed, 20 per cent variable and 10 per cent monthly variable) for the Rank and file workers. 

Workers are also entitled to a variable bonus opportunity of up to 6 months. 

Mr Tay said another positive outcome is the ruling to pay out in the form of a once-off lump sum (the entire increment package) of those who reached the salary ceiling, with some 28 per cent affected if nothing was done. 

He said this case also highlights the need for companies to work closely with their unions and be transparent and open in sharing information so that there'll be greater trust and collaboration between union and management. 

General Secretary of SRCEU, Mr Nicholas Loke, said the union is disappointed with the ruling as a whole. 

He said SRCEU, which represents about 300 employees, is greatly concerned with the transparency between the company and the union. 

"The company claims that the total compensation policy is fair and generous, but this is not easily verifiable to the Union and its members as there is no open sharing of information. The company seems to keep withholding data and information and this in turn prevents the union from paying a bigger role in collective bargaining with regards to wage increase and bonus payments. The company needs to be more forthcoming in its wage negotiations with the Union, and cannot go about conducting industrial relations as a whole unilaterally and arbitrarily by keep the Union out the planning and decision making process," he said. 

"The company has won this case, but it is fast losing the hearts of the workers," he said.