As Tesco prepares to spearhead a new price war in the retail trade, 9,500 of its staff are to begin balloting for strike action at its 75 supermarkets in the Republic. Low pay, particularly for staff in rural areas, is being cited by unions as the reason for the strike threat.
A spokeswoman for Tesco expressed surprise last night at "the precipitate action of Mandate and SIPTU in proposing a ballot for possible strike action. Such action represents an affront to existing agreements and established industrial relations procedures."
She added that the current agreement, concluded in October 1999, was not due for review until October. The Labour Court had advised "all parties to engage in discussions under normal procedures" and the company remained available to continue talks on pay and related issues.
The decision to ballot for strike action was taken at a meeting of over 100 shop stewards on Sunday. Yesterday Mandate industrial officer Mr John Douglas, who represents about 9,000 of the staff involved, said the unions supported the shop stewards because of lack of progress in talks.
"Tesco is falling more and more behind other multiples in its rates of pay," he said. According to Mr Douglas the starting rates at Tesco's Dublin stores of £4.85p an hour is 20p to 25p an hour lower than in competitors' outlets.
Scales are also longer at Tesco. At Dunnes Stores, staff can reach the top of the scale, £7.50p an hour, within three years, but at Tesco it takes five years to reach a maximum of £7.12p an hour.
The other grievance is that Tesco staff in rural areas earn significantly less than those in major urban centres. "There is no difference between packing shelves in Bray and Greystones, three miles down the road, but staff in Greystones can earn £15 to £20 a week less."
SIPTU represents about 500 staff, mainly in the midlands and north-west. It is also balloting for industrial action. Both unions want "substantial" increases in the existing rates.
They argue that Tesco is the most successful retailer in Europe and the only one ranked among Europe's top five companies. Last year sales increased by 12 per cent to £22.8 billion. Profits rose by 13 per cent to £1.17 billion. In the past year Tesco has also increased its share of the Irish supermarket trade from 22 to 24 per cent.
Besides pay, Mr Douglas said the unions want other issues addressed such as profit-sharing schemes and shift allowances in line with concessions granted to Tesco's UK employees.
The company says it has paid the full terms of the Programme for Prosperity and Fairness, including the 2 per cent cost-of-living increase due this month. This brings total pay increases so far this year to 7.5 per cent.
But Mr Douglas said the pace of progress in talks on pay had been "extremely slow" and "no real engagement" had taken place. "Tesco staff want action on low pay and they want it now."
However, it will take most of May to ballot staff and strike action is unlikely before June, at the earliest.