Call for pay rises above 5.5% from unions likely as inflation bites

The Irish Congress of Trade Unions (Ictu) is likely to update its guidance on pay claims in the private sector for the third time in a matter of months as rising inflation hits workers in the pocket, a union conference heard on Wednesday.

The most recent guidance, issued to trade unions by its umbrella body in early in February, suggested that pay rises in the range of 2.5 per cent to 5.5 per cent would be appropriate as that was in line with the level of inflation anticipated then but estimates have generally been revised upwards in recent weeks.

In its most recent quarterly economic survey, the ESRI said inflation could peak at 8.5 per cent this summer before averaging out across the year at 6.7 per cent.

"In the face of high and persistent inflation, Ictu's private sector committee has twice upgraded its advice on private sector pay aspirations since the end of 2021. And I think that they will have to do so again," Ictu president Kevin Callinan told delegates at the Siptu biennial conference in Sligo,

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He said the sudden rise in inflation had pushed the issues of pay and job security to the top if the unions’ agenda.

“We cannot ignore the impact of inflation on living standards. It hits the poorest first and hardest. And we must utterly reject the narrative developing in some quarters that compensatory pay increases will fuel inflation.

‘Cause’

“Let’s be clear: workers are not the cause of inflation, they are its victims. But we also know that, against today’s uncertain background, the protection of employment must remain as big a priority for our movement as confronting the cost of living.”

He said that unions find themselves "operating in a fast-changing situation with nobody able to predict the wider effects of the war in Ukraine with certainty. "What is certain is that we will all feel the impact – definitely in terms of further increases in the cost of essentials like food and fuel, and possibly in the form of a new and potentially deep recession."

Strong unions asserting their members’ rights in collective bargaining was an essential element in countering this threat but Mr Callinan, who is also the general secretary of Forsa, suggested the Government must also engage with unions, employers and others in order to address the current uncertainty.

“Using the LEEF (Labour-Employer Economic Forum) as the main vehicle, unions, employers and Government quickly and effectively tackled huge issues like maintaining incomes and employment through State supports, and collectively agreeing an effective approach to workplace health and safety during a pandemic.

“I have consistently argued that we should deploy the same approach to big-ticket issues like climate change and the just transition, expanding the role of the State, dealing with structural economic shifts like automation and changing patterns of work organisation, and creating world-class public services in the post-pandemic era. Clearly, the economic and geopolitical impact of the war in Ukraine needs to be added to that list,” he said.