Reversal of entry level wage cut bad for jobs, says Ibec

EMPLOYERS’ BODY Ibec has criticised the Government for reversing the cut in the minimum wage.

It has also urged the Government to abolish the controversial Joint Labour Committee (JLC) mechanism for setting wages in a number of sectors rather than simply reforming the system.

Addressing Ibec’s employment law conference in Dublin yesterday, its director of industrial relations, Brendan McGinty, said the restoration of the national minimum wage meant it would be 28 per cent higher than the UK rate.

He said this differential was even more significant – at about 37 per cent – in sectors where pay and conditions were governed by the JLC system. Mr McGinty said this differential was “unsustainable” and represented a barrier to job creation.

“The Government should reflect on the needs of businesses affected and take bold and decisive action to abolish the JLCs and bring our regulated employment agreement framework into the 21st century.”

Mr McGinty also warned the Government against introducing mandatory trade union recognition or compulsory collective bargaining. He said that this was a “red line issue for employers on a par with the 12.5 per cent corporation tax rate”.

He said Ibec welcomed comments by Minister for Enterprise and Jobs Richard Bruton that there was nothing in international law which required Ireland to revise the existing legislative provision with regard to collective bargaining. He said it was up to the Government to bring speculation on this issue to an end.

Mr McGinty also called on the Government to introduce reforms to legislation governing bullying and harassment in the workplace.

He said that for every employee who was “a victim of an overzealous manager or vindictive colleague, there is a worker who responds to being managed or being given reasonable direction with an allegation of bullying”.

He said that while Ibec welcomed the Government’s jobs initiative, it believed the levy on private sector pensions to pay for the programme would add to the very serious problems already facing pension schemes.

He warned that the introduction of the levy could represent a tipping point that could force the closure of a number of defined-benefit schemes or could leave employers and employees having to pay higher contributions or accepting lower benefits in the future.

Meanwhile, director of the National Employment Rights Authority Ger Deering told the conference that last year it had prosecuted 143 employers for breaching workers’ rights – and secured convictions in 32 cases.

He said it had carried out inspections in over 5,000 workplaces during that period – and that €48,000 had been secured in fines from non-compliant employers.