Management at Eason & Son met employee and trade union representatives yesterday to discuss how to reduce its cost base by €2.5million.

The retailer outlined plans for savings under six different headings, including reducing its top rate of hourly pay from a maximum €14 to €12 and scrapping the traditional Christmas bonus of an additional week’s pay.

Eason, which employs 1,000 people, also said it wanted to freeze all increments for five years and introduce a pay cut for salaried staff of between 2 per cent and 5 per cent depending on pay grade. Sick pay entitlements for hourly paid staff as well as changes to holiday entitlements and Sunday work rates are also being considered by Eason.

The retailer confirmed a "consultative process" was ongoing but declined to comment further. Trade union Siptu is understood to be considering the proposals.

Eason made a profit of €2.6 million in the year to the end of January 2013 compared with a loss of €5.3 million in the previous 12 months after reducing its annual cost base by €6.1 million between 2011 and 2012.

The company is understood to have told its unions that further cuts were required because of challenging trading conditions in its core categories of books, newspapers and magazines. Management told its union that it hoped to avoid store closures and redundancies if it can achieve the savings.