VIEWED FROM a trade union perspective, the structures underpinning social partnership are creaking under the weight of corporate avarice. The sense of common purpose that informed the initial partnership agreements from 1987 onwards has been sundered gradually by greed.
"There's a real difficulty in Irish society. We need to develop a sense of common purpose, but it's missing because society is so unfair," the general secretary of the Irish Congress of Trade Unions (Ictu), David Begg, said yesterday, launching its Economic Outlook 2008.
Talks on a new national pay deal commence tomorrow. But Begg says that, in the absence of any shared sense of social purpose, "it would not be the worst thing in the world if there were no agreement".
Even allowing for an element of pre-talks posturing, trade union anger at what is seen as a widening earnings gap in Ireland is palpable.
So what is the evidence? Central Statistics Office data shows that, on an economy-wide basis, earnings in Ireland averaged €38,000 in 2007, with average industrial earnings coming in somewhat lower, at €33,000.
The ground is far less firm in the case of executive pay. Judging from the Irish Management Institute's (IMI) annual survey of executive salaries, management remuneration is good but not great in Ireland. The IMI found that in 2007, the median remuneration packages for chief executives ranged between €134,000 and €312,000.
Lower down the executive ladder, middle managers were receiving pay packages of between €59,000 and €86,000 in 2007, according to the IMI. Its survey included 150 companies and covered 6,200 managerial salaries. However, the response rate to its survey was low.
Separately, executive selection consultants Merc Partners found that, when it comes to publicly-quoted companies, while it may be tough at the top, it's also exceptionally well-paid. Analysing the annual reports of the top 20 publicly-quoted companies in Ireland, Merc reported in January 2008 that: "Last year the average base salary for a CEO in this group of companies was €714,000 with a performance-related award of €586,000 and a total remuneration of €1,348,000. This was approximately 13 per cent up on the prior year."
Thus, the average remuneration packages granted to the top 20 chief executives of Irish public companies are 35 times higher than the annual income of the average employee.
Moreover, chief executives were not the only beneficiaries of large remuneration packages. Merc found that executive directors at the top 20 publicly-quoted Irish companies received average base salaries of €375,000, bonuses of €316,000 and total remuneration of €756,000, a rise of 12 per cent on the previous year.
Further indications of a widening earnings gap were provided by the report of the Review Body on Higher Remuneration in the Public Sector, published last October. This report ensured that the pay advances secured by top managers in the private sector filtered through to the cream of the corps of public sector managers.
The review body retained Hay Group Consultants to survey the pay of industry chiefs. It then awarded increases to 1,600 top public sector managers sufficient to close the pay gap with the lowest quarter of comparable managers in the private sector, having subtracted 15 per cent for the value of "superior" public sector pensions.
On foot of these findings, the review group recommended that the Taoiseach's annual salary be raised from €271,822 to €310,000 while proposing that the pay of Ministers be lifted from €214,344 to €240,000. These proffered increases have been deferred.
Other significant awards were also made by the review body. The salaries of heads of universities were increased from €226,895 to €270,000, while it also recommended increases of more than €45,000, to €247,000, for the chief executives of the State agencies Fás, Enterprise Ireland and Forfás.
The balance of the evidence thus suggests a widening gap between salaries at the top of the corporate tree and wage rates on the shop floor. In this, Ireland is mirroring an international trend.
However, there is a twist in this earnings tale. The benchmarking of top managers' pay in the public sector to the pay of senior executives in the private sector has imported these growing earnings disparities into the public sector pay structure.
For the trade unions, the increases recommended last autumn for public sector chiefs are the unkindest awards of all.
Paul Tansey is Economics Editor