Siptu has served two weeks' strike notice on Irish Ferries after the company wrote to workers on its Irish Sea routes offering them a choice between redundancy or lower pay.
The company, part of Irish Continental Group, is seeking 543 voluntary redundancies on its services between Dublin and Holyhead and Dublin and Rosslare.
It is offering workers a voluntary redundancy package of up to six weeks pay per year of service as well as the statutory two weeks pay. Workers have until October 2nd to accept the package, which the company said was subject to "no threat of or actual industrial action of any sort happening".
It warned that if the offer wasn't accepted or if workers threatened or took strike action, "we will have no option but to completely exit the operation of ships on the Irish Sea". It added that it would then have to issue compulsory redundancy notices.
Under the terms of the Irish Ferries offer, those who choose to remain with the company face lower pay and revised working conditions, although Irish Ferries is offering compensation packages for loss of income and time off. The company plans to replace the departing workers with cheaper labour, contracted from an outside agency employing EU personnel.
Irish Ferries's two main unions, Siptu and the Seamen's Union of Ireland reacted with shock and anger to the company's move.
Siptu branch secretary Paul Smith described it as "a lesson in corporate greed" and said that the union was left with no choice but to issue strike notice given the company's rejection of the recommendations in an independent consultants' report that would have preserved jobs.
"We have already agreed to €3.5 million in cuts and the company is holding its market share but it seems intent on using loopholes in the labour laws created by flags of convenience to recruit cheap labour abroad."
Irish Ferries blamed the move on the need to ensure its survival in the face of increased competition from low-cost sea and air operators and higher costs, including rising oil prices. Although the group is profitable, it says it will be loss-making by the end of the 2007 season if it does not cut costs to improve its competitiveness.
"To continue operations on the Irish Sea, we must reduce the cost base by €15 million a year. Another €5 million per year must come out of shore-based costs," chief executive Eamonn Rothwell said in a letter to staff. "If action isn't taken, Irish Ferries will go the way of B&I except that this time, there'll be no bail out by the Government."
Robert Carrick, general secretary of the Seamen's Union of Ireland, which represents about 60 per cent of the 543 workers affected by yesterday's announcement, said it had immediately requested a meeting with the Irish Congress of Trade Unions, which will take place this morning.
Minister for the Marine Pat "the Cope" Gallagher, who recently commissioned a report on State aid for the sector, said he was "disappointed the company felt the need to resort to such extreme measures". He hoped it would delay implementation of its plan until the Government considered recent proposals for additional tax breaks for the sector.
