Luas operator Transdev has indicated to staff that if the current wave of strikes continues, the company may have to look at cuts to expenditure rather than pay rises.
In a letter to its workforce on Thursday, the company said there was no more money available either from within the company itself or from any other source to provide higher pay.
Transdev said it would not be pulling out of its contract to operate the Luas system and urged employees to lower their demands.
“If we are to avoid a long and protracted dispute, reality must now prevail and expectations must be substantially moderated,” the company said. “You must understand that we have a diminishing pool of financial resources that reduces with every additional day of industrial action. If the action persists then not only will we be unable to deal with a claim for pay progression but we will have to initiate discussions with staff to align our existing cost base with available resources.”
Standstill
The light rail system is set to come to a standstill again this weekend as Luas workers stage two more days of strike action as part of a campaign for improved pay and conditions.
Nigel Stevens, the company's chief executive for UK and Ireland, who visted Dublin this week, said in the letter that Transdev would not "stand idly by while our already challenging financial position (which has been independently verified) is further eroded".
“This is not what we want to happen but we are resolute that the current demands are untenable and will not be countenanced regardless of the nature and extent of industrial action that is notified to us,” he said, adding that the pay demands by staff were “totally unaffordable”.
Mr Stevens said Transdev was prepared "to conclude a fair and balanced agreement" that was fully in line with current norms in the private and public sector with essential cost offsetting measures.
He said the company was “100 per cent committed to the fulfilment of the current contract up to 2019 and hopes that its role in the Irish market can extend long beyond this”.
‘Coercive’
Mr Stevens told staff in the letter: “You now have a choice to engage constructively with the local management team and conclude an agreement that is within the limits of current available resources. The alternative is for the campaign of coercive industrial action to continue over the coming weeks and months, for our customers to be further inconvenienced and for us to be left with no option but to take action in relation to our operating costs to protect our financial position.”
Siptu, which represents Luas workers, said it was “dismayed” that Mr Stevens did not meet worker representatives during his visit to Dublin. This suggested Mr Stevens did not view the workers or their representatives “as being key stakeholders worthy of meeting”.
Organiser John Murphy said “the implied threat” in Mr Stevens’ letter to staff that there will be cutbacks if the industrial action continues did “not assist in bringing this dispute to a conclusion and we ask him to withdraw it”.
The National Transport Authority (NTA) on Thursday welcomed Transdev's statement that it was committed to fulfilling its current 2014-2019 contract for the provision of Luas services.
NTA chief executive Anne Graham said: "The Authority, too, is firmly committed to this contract, which extends to 2019. Luas operations, under Transdev (previously "Veolia") from the outset, have run extremely well, until the recent industrial relations disruptions. "
She said planned strikes on this (Saturday and Sunday would “only add further inconvenience to the strong customer base that Luas has built up over the years”.
Two more days of strikes by Luas staff, who are represented by Siptu, are also scheduled for later this month.
The pay proposals which were rejected last week by staff would have involved increases in earnings for many drivers of up to 18 per cent over three years.
Staff at Luas initially sought pay rises of up to 53 per cent. They subsequently revised their claim down to about 27 per cent. They have also sought improvements in conditions of employment.
