Unions, employers have many hurdles to clear

Employers and unions are at odds over key issues as partnership talks begin, writes Chris Dooley , Industry and Employment Correspondent…

Employers and unions are at odds over key issues as partnership talks begin, writes Chris Dooley, Industry and Employment Correspondent.

After a protracted period of sparring, the social partners today finally begin the serious business of attempting to negotiate a new national agreement.

Like motherhood and apple pie, the objectives of two of the main players - unions and employers - would surely command unanimous support.

After all, few would argue that decent employment standards are not a good thing. And do we want a competitive economy in order to keep the boom rolling? Of course we do.

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These broad-brush targets, however, mask fundamental differences which will make a seventh partnership agreement perhaps the most difficult to achieve.

Throw in the diametrically opposed views of the parties on other issues such as local bargaining, pay and mandatory pensions and it becomes even clearer that the negotiators have their work cut out.

But it is in the arena of employment standards that the first major battle will be fought.

The plan is that in the initial stages of the talks employers, unions and the Government will devote afternoon sessions to the thorny issue of labour market regulation and enforcement.

The Irish Congress of Trade Unions (Ictu) view is that now that Ireland's labour market of two million is open to 70 million EU workers, strong measures are needed to prevent a "race to the bottom" in employment standards.

Ictu wants stronger regulations and better enforcement of labour laws to ensure that increased competition for jobs does not cause a downward spiral in wages and conditions.

Employer bodies say they have no problem with measures ensuring compliance with existing standards, but they warn that increased regulation could scare away foreign investors currently attracted by Ireland's flexible labour market.

Significantly, Taoiseach Bertie Ahern offered strong support for this view when he attended the formal opening of talks at Dublin Castle on Thursday.

"We know from other countries that the more you are regulated in a statutory way, the less well you do," he told reporters.

After citing France and Germany as examples of countries overburdened by regulation, he added: "If you regulate employers out of existence, who loses? Workers, ordinary people, so it is in nobody's interests to come up with conditions and circumstances that force investment out of this country."

But Mr Ahern was nothing if not even-handed. The issue of employment standards had been "flagged" by Ictu, he said, and was an important one for the country.

"We do not want to see people building competitive advantage based on poor wages, casualisation of labour, low health and safety standards or other poor compliance practices."

All parties to the talks, however, recognise that turning the twin objectives of the employers and unions on this issue into a mutually acceptable reality will be extremely difficult to achieve.

Even if they manage it, further potential logjams will have to be negotiated.

Among the trickiest could be the unions' demand for some kind of local bargaining element to be included in any new agreement, which could be a make-or-break issue.

The unions' logic on this one is simple: the most recent partnership programme contained an "inability-to-pay" clause for employers who could not meet its terms.

Why then, should there not be an "ability-to-pay-more" provision for highly profitable enterprises who can afford it? Why should bank officials, for example, have to live with modest pay rises drawn up to suit hard-pressed manufacturing companies?

The frustration of some private sector workers in this regard is compounded by a perception that they are becoming the poor relations of their public sector counterparts.

With a new benchmarking pay- out on the way for public servants, securing a local bargaining clause has become a priority aim of private sector unions.

Employer bodies, however, are implacably opposed to the idea. In a response that matches the logic of the unions' argument, Ibec director Turlough O'Sullivan says unions, in effect, want to have their cake and eat it.

"We don't want the worst of both worlds. Either we have a national agreement or we have local bargaining - we can't have both," he suggests.

And all of this is without reference to perhaps the most thorny issue of all: pay rates and the duration of any new deal.

While there is agreement that a new partnership programme should run for longer than the traditional three years, Ictu wants the pay element negotiated every two years, while Ibec and Mr Ahern want a three-year pay deal.

Unions will want pay increases of up to 5 per cent a year, while Ibec says they should be lower than the current inflation rate of below 3 per cent, if Ireland is to restore lost competitiveness.

The talks are due to last six weeks. A bumpy ride is in prospect.