Private sector protocol will help local wage talks

A private sector protocol between the Irish Business and Employers’ Confederation and the Irish Congress of Trade Unions has been renewed for 2012 and 2013. The agreement will mean the continued use of basic ground rules for local pay bargaining in the private sector. The protocol has applied since the demise of national level social partnership in late 2009. Although there is some optimism that its renewal will ease wage negotiations, many firms were still planning a pay freeze.

Background

The private sector National Protocol between the Irish Business and Employers’ Confederation (IBEC) and the Irish Congress of Trade Unions (Congress) agrees the terms of basic rules for industrial relations and local pay bargaining.

The two sides have agreed to renew the deal, which is largely identical to a previous protocol, for 2012 and 2013. The protocol is intended to ensure that both unions and employers in the private sector abide by agreements and use state dispute resolution bodies such as the Labour Court and Labour Relations Commission.

The newly-signed document also commits both organisations to maintaining sustainable employment and taking economic circumstances into account in local bargaining.

The social partnership in Ireland formally ended in December 2009. The first National Protocol – and now this revised version – have meant that in the absence of the 22-year-old social partnership process, unionised companies and trade unions have informal rules to help them manage disputes.

Possible ‘rebirth’ of social partnership

Under the protocol there is room for the creation of a new social partner-led ‘troubleshooting’ body. This would be similar to the old National Implementation Body (NIB) that operated during the social partnership agreement years. The NIB was also an informal arrangement, operated by leading government officials, two IBEC executives and two leading ICTU trade union officials.

If it were to be revived in accordance with the protocol, this body would also have a tripartite nature, rather than simply being made up of private sector and trade union members.

Under the revised protocol, the parties say they will try to achieve common ground on the reform of labour market institutions – employment rights and industrial relations bodies – and support the manufacturing sector. This support would be in line with the 2008 Report of the High Level Group on Manufacturing (604Kb PDF), which advocated the encouragement of enterprise-level innovation.

Working together

IBEC and ICTU said the revised protocol was for the ‘orderly conduct of industrial relations and local bargaining in the private sector’. They have agreed to ‘work together to facilitate economic recovery through agreed strategies within their sphere of influence’ and are ‘committed to preserving stability by ensuring that industrial relations are conducted in an orderly manner and to serve the primary purpose of protecting jobs’.

Specifically they say the parties will:

  • promote meaningful and timely engagement at local level on disputed issues, ensuring that discussion is undertaken in a spirit of making every effort to reach agreement at the earliest stage;
  • encourage their members to abide by established collective agreements, ensuring that local negotiations take place when existing agreements on pay expire, and that negotiations take place in accordance with any procedures agreed at enterprise level for the resolution of disputes;
  • use the machinery of the State – the Labour Court and Labour Relations Commission (or other agreed machinery) – to resolve disputes.

No strikes deal

Both IBEC and ICTU said they recognised that they were operating in a context without a formal agreement on pay determination. But the protocol states:

...bearing in mind the shared commitment to maximising the sustainability of employment, it is accepted that the economic, commercial, employment and competitiveness circumstances of the firm are legitimate considerations in any discussion of claims for adjustments to pay or terms and conditions of employment. It is not the intention of the parties to alter their historical approach to dealing with normal ongoing change.

The two organisations say they are committed to ensuring that their respective members do not engage in strikes, lockouts or other forms of industrial action:

...in respect of any matters covered by this protocol where the employer or trade union concerned is acting in accordance with its terms.

They go on to say:

This protocol remains effective for 2012 until the end of 2013 and the parties will meet before the end of 2013 to discuss arrangements to apply thereafter. Otherwise, the parties will meet as required to review the operation of this protocol, to oversee the delivery of industrial peace, stability, good industrial relations and to consider any procedural matters where difficulties arise.

Commentary

The revamped protocol comes in advance of a report by IBEC which forecasts that 39% of its members expect to increase pay in the private sector in 2013 by an average of 2%. Across all of the 370 IBEC member companies surveyed, however, a majority (58%) were still expecting to maintain a pay freeze.

The weekly specialist magazine Industrial Relations News (IRN) says that freezing pay:

...has been the pay policy response of a consistent majority of employers since the economic crisis began in 2008, with many companies facing into their fifth year of a pay freeze.

However, the 39% figure in the latest IBEC survey for those expecting to increase pay is the highest since 2008.

IBEC Director Brendan McGinty said most employers were still not in a position to award general pay increases but added: ‘Encouragingly, 2012 labour cost estimates from Eurostat show that Ireland is heading in the right direction.’

Recently, the Technical Electrical and Engineering Union (TEEU) became the first union for some time to announce it would lodge pay claims of around 5% for employees working in profitable companies.

The newly-revised protocol can be expected to help companies and unions manage any mild rise in pay expectations.

Brian Sheehan, IRN Publishing

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