Minister urged to go further in wage reforms

EMPLOYERS LAST night urged Minister for Enterprise and Jobs Richard Bruton to go further in his controversial plans for reforming wage-setting mechanisms for over 200,000 workers.

At a meeting, employers’ group Ibec proposed that the Minister should not simply reform the joint labour committee system for determining pay and conditions, but rather abolish it completely.

The Construction Industry Federation (CIF) called on the Minister to introduce greater reforms in the area of registered employment agreements than set out in his proposals.

However, at the same time, a group of 36 economists, economic analysts and social scientists expressed concern at Mr Bruton’s proposals, which they said would further shrink demand.

The Minister is expected to meet representatives of the Irish Congress of Trade Unions today. It is likely further meetings will be scheduled before he brings final proposals to Cabinet.

Under the proposals, tens of thousands of workers in hotels, restaurants, retail and other sectors would lose their legal entitlement to special Sunday premium payments. Existing overtime arrangements could also be curtailed.

Ibec said sectors covered by a joint labour committee system had a 37 per cent average premium above minimum rates in the UK.

The CIF said reforms of the registered employment agreement system should include the introduction of termination dates to limit the life of such deals and the streamlining of variation mechanisms so changes in the economy could be reflected.

Separately, the Tasc Economists’ Network, comprising economists, economic analysts and social scientists, said it broadly welcome the findings of the Duffy- Walsh review of the wage-setting mechanisms, particularly the recommendation that the basic joint labour committee framework should be retained.

“Minister Bruton’s proposals, if implemented, would reduce the pay of low earners. These workers by necessity spend a higher proportion of their income on consumption, and consequently cutting their wages will significantly reduce spending in the economy at a time when the savings rate is already very high and domestic demand has collapsed. Any amendments to wage-setting mechanisms should ensure that the incomes of vulnerable low earners are fully protected, and that demand in the economy is not further impaired,” the statement said.