Local bargaining trends show degree of employer flexibility
Published: 27 July 1998
Ireland's current economic and social pact, /Partnership 2000/ (P2000) agreed in early 1997, provides for a total private sector pay increase of 9.25% over the lifespan of the 39-month agreement - a settlement broadly similar to that for public services. A total of 7.25% is payable in four phases in the form of basic pay increases, while a further 2% is available through local bargaining in the second half of year two of the agreement. A similar provision is contained in the public service agreement, but is payable at a later date, with payment related to the achievement of change.
An early analysis of private sector agreements on the 2% local bargaining element of Ireland's current three-year national pay agreement was published in July 1998. It reveals that almost half of the companies surveyed are paying the increase on a date earlier than they are obliged to.
Ireland's current economic and social pact, Partnership 2000 (P2000) agreed in early 1997, provides for a total private sector pay increase of 9.25% over the lifespan of the 39-month agreement - a settlement broadly similar to that for public services. A total of 7.25% is payable in four phases in the form of basic pay increases, while a further 2% is available through local bargaining in the second half of year two of the agreement. A similar provision is contained in the public service agreement, but is payable at a later date, with payment related to the achievement of change.
A "minute of understanding" agreement between the Irish Business and Employers Confederation (IBEC) and the Irish Congress of Trade Unions (ICTU) - agreed after P2000 was negotiated - notes that payment of the local bargaining 2% in the private sector "will not operate on an exceptional basis". This wording was aimed at alleviating trade union fears that tight restrictions which applied to the local bargaining clause in the 1991-4 national agreement, the Programme for Economic and Social Progress (PESP), would be imposed in the context of P2000.
New research, carried out by Dublin-based Industrial Relations News and published in July 1998, analyses 96 agreements on the P2000 local bargaining clause. It reveals that almost half of the companies surveyed are paying the increase on a date earlier than they are obliged to. The study also shows that about of a third of the companies surveyed have agreed to pay more than the total of 9.25% which is formally available under P2000.
The survey indicates that employers in a tightening labour market, where there is evidence of some degree of skills shortage, are prepared to bring forward payment of the 2% by between six and 18 months. Of the 96 companies surveyed, 36 agreed to pay the 2% six months early, four have paid it 18 months early while, in five other cases, the early payment varies by between three and 12 months. In all, 36 are paying the 2% on the "due" date, nine are to pay it on a phased basis and just one is to pay it "late".
Eurofound recommends citing this publication in the following way.
Eurofound (1998), Local bargaining trends show degree of employer flexibility, article.
