Irish postal service faces major industrial relations challenge

Significant cultural barriers inhibit the development of a positive industrial relations climate in An Post, Ireland's state-owned postal company, according to a highly confidential report which became publicly known in December 1997.

A confidential interim report into industrial and employee relations in An Post, Ireland's state-owned postal company, highlights the adversarial nature of its industrial relations structures and practices and how these are inhibiting the development of a more customer focused business. The report, which was submitted to the company's chair, Stephen O'Connor, in February 1997 was carried out by a subsidiary of the Irish Business and Employers Confederation (IBEC) - Employee Relations Services (ERS). It was featured in the industrial relations weekly, Industrial Relations News, in December 1997.

The ERS report highlights the hierarchical approach adopted by central management and the ability of the trade unions to maintain traditional stances. It proposes radical changes such as ending access to the state-operated conciliation and arbitration (C&A) pay machinery, new communications initiatives and key changes at management level.

An Post has a monopoly on letter-post services. It also has an extensive retail network, offering many services and products to business and consumers, such as savings accounts and gilt-edged state-guaranteed investment plans. It employs around 7,500 full-time staff and became a commercial semi-state company in 1984, having previously been run directly by a government department. Employees who were employed prior to that date retain their former, pre-1984 status as civil servants.

The company went through a cost restructuring programme after reaching agreement with its trade unions in 1994, which included the closure of its former central letter-post sorting office in "Dublin" City centre. The sorting office - a centre of militant trade unionism - was moved to a new suburban location, the Dublin Mails Centre, which has easy access to newly developed road systems.

In a short statement, the company noted that the ERS report followed on from two earlier reports, a broad and wide-ranging review carried out by consultants, Price Waterhouse, and a report by the Labour Relations Commission (LRC) into industrial relations problems in the new Dublin Mails Centre. The company said the ERS report "is consistent with the views expressed both in the Price Waterhouse and Labour Relations Commission reports, both of which are being implemented".

ERS found, through interviews and discussion at various levels, "significant elements or barriers which are inhibiting the development of a positive climate of employee relations". The barriers were summarised as follows:

  • the 1984 establishment legislation and its political side effects;
  • the trade union ethos;
  • management culture and style;
  • the industrial relations system; and
  • the absence of an "employee relations" agenda.

The report says that as long as pre-1984 staff continue to be employed, the 1984 legislation will continue to have a major bearing "as the trade unions are unlikely generally to countenance a two-tier structured approach to employment security or conditions, with inferior conditions being applied to post-1984 personnel." Propositions for change become "fertile grounds for suspicion". There is also the illusion of immunity from competition, with the exception of An Post's Special Distribution Services (SDS) division, which the trade unions have generally excluded from threats of industrial action.

Trade union ethos

The ERS report says that the unions have an exclusive public sector background which means that their approach to issues of competitive change is "very loosely conditioned by commercial criteria...". Union structures also "carry with them barriers to normal relations" and there are "power factions" which have been a particular problem in the Dublin area.

The annual electioneering process for internal trade union posts can involve "a quasi-political approach to the conduct of industrial relations; whereby the An Post employee is involved in preparing his election campaign and vote-getting capacity for up to an initial six months." This contributes to what ERS describes as "industrial relations gridlock".

Management style

The report notes that the overall management style has been described as "confrontational, preoccupied with industrial relations and also highly directional and overly centralised in a hierarchical sense". These comments are "substantially true", according to the report, which favours measures "now being taken" to change management style by driving the "ownership" of key business issues down to business-unit level.

The report observes that the level of employee involvement in An Post is extremely low but notes that the style of management is not conducive to developing effective involvement strategies. What involvement there is, is primarily indirect (ie via staff representatives and worker directors). The communications process, however, is "almost entirely controlled by the trade unions" and they would be likely to resist attempts by management to launch any new initiatives in this area.

Commentary

The ERS report is consistent with earlier reports in highlighting how difficult it will be to re-cast industrial relations in An Post along partnership lines. On the evidence of past disputes, management appears to have been as comfortable with traditional adversarial relationships as the unions are.

The challenge for the two sides is to see the report as an opportunity rather than a threat. They could look to other state-owned companies, such as Telecom Eireann, ESB or Aer Rianta as models to follow

At this point in time, however, it is difficult to be optimistic about An Post in this regard, in contrast to the aforementioned organisations. The competitive circumstances of its letter-post business in particular are significantly different, being largely insulated from market pressures. In such circumstances, there may be little incentive for management and unions to reshape industrial relations in a significant way.

The Department of Public Enterprise, which oversees An Post's operations, is keenly aware of cost-competitiveness issues. To date, however, it has not prioritised the development a "new" model of industrial relations which the semi-state companies under its control could use as a template. (Brian Sheehan, IRN, and John Geary, UCD)

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