- Observatory: EurWORK
- Published on: 28 Listopad 2012
Disclaimer: This information is made available as a service to the public but has not been edited by the European Foundation for the Improvement of Living and Working Conditions. The content is the responsibility of the authors.
This annual review considers Irish industrial relations and working conditions developments in 2011. Irish industrial relations have been negatively affected by the gravity of the country’s financial and economic crisis. Many workers are experiencing unemployment or erosion of pay and working conditions, and there has been a marked rise in emigration, with demand for labour being sucked out of the economy. A number of significant political, legal and industrial relations developments were evident during 2011,notably the election of a new government, changes to sectoral wage regulations, and ongoing restructuring affecting the banking and finance sector. Economic, labour market and industrial relations policy has been shaped by an austerity-driven agenda, fuelled by a mix of domestic and external contextual conditions (notably factors associated with the financial ‘bail-out’ by the troika of the EU-European Central Bank-International Monetary Fund).
1. Political and economic developments (200 words)
Please give very brief details of:
- The government (s) in office during 2011
- Any general or significant regional/local elections held in 2011
- Any other significant political events which took place in 2011
- Any forthcoming national or important regional/local elections or significant political events
- Any major economic developments which are likely to impact upon employment and industrial relations.
If a new government took office during the year, briefly summarise the implications for policy on employment and industrial relations.
There were a number of highly significant political developments in Ireland in 2011, notably a general election and the related political repercussions of the fact that Ireland required a financial ‘bail-out’ from the troika of the European Union-European Central Bank-International Monetary Fund due to the parlous state of its finances following the failure of its banking system and the bursting of a massive property bubble.
A general election took place in Ireland on February 25th, 2011. It culminated in a major defeat for the Fianna Fail-Green Party coalition, which was replaced in government by a strong majority Fine Gael-Labour Party coalition. The election was notable because Fine Gael replaced its historic rival, the centre-right Fianna Fáil party, for the first time since 1927 as the largest party in the Irish parliament (the Dáil). Fine Gael leader Enda Kenny was elected as Taoiseach (Prime Minister) with Eamon Gilmore was appointed as his deputy (Tanaiste).
In November 2010, mounting debt problems forced the previous Irish Fianna Fail-Green government to apply for a €90 billion bail-out from the troika of the EU, European Central Bank and the International Monetary Fund. The last government then announced a four year ‘National Economic Recovery Plan’ on November 24th 2010, approved as part of this EU/ECB/IMF financial support for Ireland. Therefore, the policy choices open to the new government, including what it can and cannot do on the industrial relations and employment front, is circumscribed because most issues must have reference to that arrangement. The ‘Economic Recovery Plan’ incorporated a cut in the national minimum wage (NMW) of €1 per hour to €7.65 per hour (however, the new government subsequently reversed this decision, see 2 below). The plan also proposed a review of legally binding sectoral wage agreements, regulated by Registered Employment Agreements (REAs) and Joint Labour Committees (JLCs) (details of this review in 2 below). Other proposals in the plan include: annual savings of €1.2 billion in the public sector wage bill, a 10% reduction in pay for new entrants to the public service, who will also start on the minimum point of the scale. The big change at the top in the public sector is a salary cap of €250,000. The overall aim is to bring the country’s deficit below 3% by 2014. With this in mind, politicians have since imposed austerity related legislation and budgets to achieve cuts.
2. Legislative developments (300 words)
Please give brief details of important legislative developments with implications for industrial relations and working conditions, where these are not covered in other sections of your response. For example, this might include new or amended legislation on issues such as employment rights, working time, pay and conditions of employment, termination of contract, equality, social security (with implications for the employment relationship), training, new forms of work, the labour market, health and safety etc.
There were a significant number of industrial relations and working conditions related legislative developments in Ireland in 2011, some of which have resulted in legislation and some of which may eventually result in legislation.
a.The Protection of Employees (Temporary Agency Work) Bill 2011 The new draft legislation to transpose the EU agency workers’ Directive into Irish law is not only retrospective back to December 5, 2011, but also raises issues around identifying host company workers as comparators for agency workers, the mutual obligations of hiring employers and agencies and the possible inclusion of some self-employed contractors, among others. The Protection of Employees (Temporary Agency Work) Bill 2011 was published just before Christmas 2011, following the failure of the social partners to agree a derogation that would exempt agency workers on shorter assignments from the equal treatment provisions of the EU Directive from day one. Therefore, Ireland was compelled to adopt the default provisions in the Directive. Just before publication of the Bill, the Minister for Jobs, Enterprise and Innovation, Richard Bruton, had signalled that the basic working conditions on which agency workers will be entitled to the same treatment as comparable permanent workers were pay, annual leave, public holidays, night work and rest period and breaks. However, working conditions that are not included are sick pay, occupational pension schemes, benefit in kind, financial participation payments and bonus payments.b. New legislation on sectoral wage-setting mechanisms This is one of the commitments in the EU-ECB-IMF troika agreement referred to in 1 above. The new Irish legislation for sectoral wage-setting mechanisms includes temporary exemptions from sectoral minimum wages, easier enforcement options and detailed procedures for establishing, varying and cancelling sectoral wage orders. Many of the items in the Industrial Relations (Amendment) (No.3) Bill, 2011, were set out in a previous announcement on wage-setting mechanisms by the Minister for Jobs, Enterprise and Innovation, Richard Bruton, in summer 2011, such as a reduction in the number of rates and the exclusion of Sunday premiums. However, the new Bill provides much more detail on the procedures to apply in the case of establishing, varying and cancelling both Registered Employment Agreements (REAs) and Employment Regulation Orders (EROs). It also sets out for the first time a detailed process by which individual employers can seek temporary derogation from the sector-level minimum pay and conditions set by both REAs and EROs, on grounds of financial difficulty/inability to pay. These are more wide-ranging than the individual employer exemptions under the National Minimum Wage Act 2000, which had hardly ever been used. The derogation provisions are identical for both EROs (which cover lower-paid sectors) and REAs (which cover more skilled workers and tend to have higher pay rates). An exemption is to be for a maximum of 24 months and a minimum of three months, with employers barred from seeking exemptions if they have already been granted an exemption in the case of the same workers in the previous five years.
In a related legal development in July 2011, the High Court ruled that the issuing of EROs under the 1946 Industrial Relations Act, setting minimum pay and conditions for workers in lower-paid sectors, was unconstitutional. The case arose from a challenge taken by the Quick Service Food Alliance (QSFA) group of fast food operators – a group which includes Subway, Burger King, Supermacs, Abrakebabra and others – against the catering industry ERO for areas outside Dublin. The new legislation above on sectoral wage regulation takes this ruling into account.
c. Reversal of the National Minimum Wage cut
The cut in the national minimum wage from €8.65 down to €7.65 implemented in December 2010 by the previous government as part of the EU/ECB/IMF troika agreement was subsequently reversed by the current Fine Gael-Labour government in early 2011 (this was a pre-election pledge).
d. Commitment on collective bargaining
The new government has promised to implement new rights to engage in collective bargaining after it was widely held that a 2007 judgment by the Supreme Court annulled the original Industrial Relations Acts (2001 and 2004) which regulated procedures on union representation rights for union members in non-union workplaces. In view of this, the Fine Gael and Labour Government, in their joint Programme for Government, state:
“We will reform the current law on employees’ right to engage in collective bargaining (the Industrial Relations (Amendment) Act 2011), so as to ensure compliance by the State with recent judgments of the European Court of Human Rights.”
In setting out their commitment in this way the current government seems to be placing considerable store in key judgments of the European Court of Human Rights, such as Wilson and Demir. However, union representation rights in Ireland are complicated by the existing legal position that, under the Irish constitution (1937), the right of association (which includes the right to join a trade union) is, in effect, seemingly cancelled out by the right of en employer not to recognize a union. To circumvent this, the new government may attempt to introduce legislation which gives effect to the right of workers to bargain collectively, but this would not imply any right on the part of employers to recognize a trade union. The 2011 Industrial Relations Act grants workers the right to representation and to bargain collectively, but does not provide for union recognition as this would, most legal experts agree, be unconstitutional. This suggests that the government may decide to draw up rules that provide for worker representative bodies to be sufficiently independent from undue employer influence. This would allow for a form of collective bargaining without the need to amend the Irish Constitution, and yet satisfy trade union calls for the right to collective bargaining to be enshrined in a practical manner in Irish law. Any move toward full union recognition rights is seen as highly unlikely, due to the Constitutional blockage referred to above – and because Irish employer organizations and the state’s job creation agencies would be strongly opposed to any measure that might hinder inward investment by non-union multinationals, especially those originating in the United States.
e. Merging of Employment Rights bodies
The Minister for Jobs, Enterprise and Innovation, Richard Bruton, announced in July 2011 his intention to reform and merge the State’s various employment rights and industrial relations institutions. A key aim of the Minister’s proposals is to create a “new integrated two-tier structure” to replace the five existing employment rights bodies. It is envisaged by the Department of Jobs, Enterprise and Innovation that reform of the existing employment rights bodies will be completed by the end of 2013 and may include an overhaul and consolidation of all employment legislation.
f. Public service pension legislation
New public service pension legislation published in September 2011 is far-reaching, will cut the long-term pension bill by over a third, but will have little effect in the short-term. Just over half of the 35% saving on public service pensions that will eventually arise from the proposed new public service pension legislation would be derived from the career averaging system. Overall, official sources expect that while continuing with the current system would lead to a public service pensions bill of €5 billion in 2050 (in 2010 euro terms), implementing the changes in the Public Service Pensions (Single Scheme) and Remuneration Bill, 2011, will result in a bill in 2050 of €3.2 billion (in 2010 euro terms). Of the €1.8 billion saved, €1 billion would be from moving from a final salary to career average basis, €300 million would be from increases in the pension age and €500 million would be from changing the indexing of pensions to the consumer price index, from the current ‘parity link to existing staff.
3. Organisation and role of the social partners (300 words)
Please provide brief details of any major changes in the organisation and role of the social partners in your country during 2011. This might include trade union or employers’ organisation mergers, changes to social dialogue structures, or changes in membership levels and representativeness.
The collapse of Ireland’s centralised social partnership model in late 2009/early 2010 has resulted in a considerably diminished role for the social partners. Much of the substantial tripartite architecture of social partnership that had been built up since 1987 is in the process of being dismantled. In particular, one of the most long-established social partnership bodies, the National Economic and Social Council (NESC), is set for abolition. Since its seminal 1986 report, which underpinned the first tripartite pact, the Programme for National Recovery, NESC had issued consensual reports that preceded each of the subsequent eight national-level agreements. The plan to shut down NESC is contained in the public service reform plan launched in November 2011, which lists 48 bodies for rationalisation, amalgamation or abolition in 2012.
The new government also favours the concept of social dialogue, rather than social partnership, and apparently has no intention of returning to tripartism/national pacts. Moreover, the Department of an Taoiseach (Prime Minister) no longer exerts the sort of authority over policy it did during the social partnership years (1987-2009) (notably when Bertie Ahern, a strong advocate of social partnership, was Taoiseach). Rather, the Department of Finance exerts a firmer grip on policy nowadays; as do the EU/ECB-IMF given the external bail-out.
A number of bi-partite social partner arrangements are in place in the public and private sectors, which have implications for the role of the social partners, in the sense that they have had to become accustomed to dealing with the new government on a bilateral basis (after over twenty years of tripartism) . The most significant bi-partite arrangement in the public sector is that pay and reform is governed by the ‘Croke Park Agreement’ (CPA) between government as employer and public service unions, concluded in 2010.
In the private sector, despite the collapse of formal wage bargaining under national social pacts, there was a continuation of a voluntary national social partner protocol covering wage bargaining in 2011, with a view to coordinating future private sector pay claims on a more informal basis. The national private sector protocol dates back to March 2010, when the Irish Business and Employers Confederation (IBEC) and Irish Congress of Trade Unions (ICTU) “agreed tripartite structures under a rotating chairmanship to include Government”, which would oversee issues arising under the protocol. The voluntary protocol provides negotiators with broad pay guidelines, using criteria for issues like competitiveness. It set out agreed priorities, such as maintenance of employment and the need to take commercial and economic factors into account when considering pay ‘adjustments’ (wording that covers both pay increases and pay cuts). Member employers and unions of the social partner bodies are committed to using existing procedures and the State dispute resolution institutions for dealing with pay disputes.
4. Developments in collective bargaining and social dialogue (350 words)
Please give details of the number of collective agreements negotiated in 2011 by level (eg. national, sectoral, company), compared with numbers of agreements negotiated in 2010. Outline any trends/shifts between levels of bargaining, or changes in bargaining coverage.
- To what extent are there derogations from collective agreements? Describe any trends in terms of derogations.
- If there have been any major bipartite or tripartite initiatives at national level, please provide details. (Do not include initiatives which deal specifically with the economic situation as these should be covered in question 5)
Ireland’s former centralized national system of tri-partite collective bargaining has been replaced by new bargaining arrangements in the public and private sectors. In the public sector, the government as employer and the public sector trade unions negotiated a national bi-partite deal on public service reform in June 2010 in exchange for a promise of no pay cuts prior to 2014 – which was called the ‘Croke Park agreement’ (CPA), as noted above. Employer associations were not party to the agreement. The four-year agreement, which potentially covers over 250,000 public servants, incorporates a four-year pay freeze, and commitments by the government not to implement compulsory redundancies. In return, unions signed up for a ‘transformation’ programme, expected to yield major productivity improvements and efficiencies – as well as a broad commitment to maintain industrial peace. Some of the major reform agendas in the CPA include provision for redeployment, acceptance of significant workplace changes and changed working hours. The CPA serves as a sort of ‘enabling agreement’ for the new government’s public service reform agenda, the implementation of cutbacks, etc – and is linked to the requirements of the EU/ECB/IMF troika agreement.
In the private sector, local collective bargaining is governed by the aforementioned private sector protocol, but its rules are voluntary and informal. For the first time since 1987, 2011 has seen the emergence of decentralized local pay bargaining, albeit only on a very limited scale. Industrial Relations News (IRN) has identified some limited local pay bargaining increases in 2011, mostly in the relatively profitable pharma, medical devices and food multinational export sectors. But, according to IRN, this can be seen not so much as a ‘free for all’ but rather a much more restrained ‘trend bargaining’, with pay increases averaging 2% per annum in a few profitable sectors. IRN collated details of 54 private sector pay settlements in 2011. In the pharmaceutical and medical devices sector, which accounts for 21 of the 54 deals, the median pay increase per annum was 2% and the average annual increase was 1.9% (including single-year and multi-year deals). More generally across the private sector economy, however, the pay bargaining norm is primarily one of pay freezes and, to a lesser extent, pay cuts. Given the depth of the current economic crisis, with a sharp rise in unemployment to 14.4% and pay cutting in a significant minority of private sector firms, an old-style bargaining ‘free for all’ was not really on the cards. Rather, concession bargaining is a much more common occurrence, in the sense that many employees are having to make concessions on pay and other conditions of employment to employers where deemed necessary.
- Other conditions of employment (these might include training and skills, job security, occupational pensions, equal opportunities and diversity issues)
The breakdown of the social partnership model has meant a sharp diminution of national bargaining on other conditions of employment, such as training and skills, and pensions. A notable exception is that the ‘Croke Park Agreement’ provides an element of job security for public servants, in terms of guaranteeing no compulsory redundancies in the public sector.
Information on developments in pay and working time in the course of 2011 is being collected in the Annual Updates on working time and pay, and therefore does not need to be reported here.
5. Responses to the economic situation (200 words)
With regard to the current economic situation, please give brief details of:
- cross-sectoral and sectoral level initiatives, the responses of the social partners in your country, with a focus on any bipartite or tripartite initiatives to tackle any economic problems;
The breakdown of Ireland’s tri-partite social partnership model has more or less halted engagement between government and social partners with regard to dealing with the economic downturn. Instead, politicians have primarily implemented unilateral austerity measures to respond to the economic crisis, notably public spending cuts. This has been influenced by the perceived requirement to repair Ireland’s failed banking system, and the cost burden to the public this entails. Plus, the stringent conditions set by the EU-ECB-IMF ‘bail-out’ are influencing austerity-oriented government responses to the recession. This deflationary approach, together with a contraction in employment and demand for labour, has seen unemployment rise rapidly from just over 4% in 2008 to 14.4% in December 2011. The surge in unemployed people seeking unemployment benefits has shifted state funding towards passive labour market policy during the crisis, and away from active labour market policy. There is little evidence or possibility of politicians constructing a large-scale coordinated labour market stimulus to address the jobs crisis (with or without the social partners). Policy instruments have been too fragmented and small-scale to make a significant impact on stimulating the economy, though the new government launched what has been termed a multifaceted integrated ‘jobs initiative’ in May 2011 - details of which are in the following link: http://www.finance.gov.ie/documents/pressreleases/2011/mn018jobsinit.pdf Some of the main economic policy instruments in the new jobs initiative include: i) general instruments by national and regional development agencies to continue to attract foreign direct investment by multinationals; ii) explicit instruments to assist redundant apprentices and workers in the ailing construction sector; iii) from July 2011, a new National Internship Scheme providing 5,000 work experience placements in the private, public and voluntary sectors. This will be a time-limited scheme and will provide work experience placements for interns for a 6 to 9 month period. A weekly allowance of €50 per week on top of the existing social welfare entitlement is payable. The National Internship Scheme is aimed at graduates and other categories of young people not in employment, education or training (NEET).
Yet the sheer scale of Ireland’s crisis, debt, and austerity response, greatly restricts the policy focus and resources the new government can direct to serious labour market problems, notably the very high proportion of young people classified as NEET.
- government responses to the economic situation with an impact on industrial relations and on labour law;
- and any significant effects of the economic situation on the industrial relations system.
The impact of the economic situation on industrial relations has been covered in previous sections above, notably the ramifications of the agreement with the EU-ECB-IMF troika as a condition for the financial bail-out. Effects on industrial relations have included legal reform of sectoral wage regulations, and the replacement of social partnership with new wage bargaining arrangements in the public sector (the ‘Croke Park Agreement’) and private sector (decentralized local bargaining/concession bargaining).
6 Developments in working conditions (550 words)
Please report the most important developments in the field of working conditions and quality of work and employment during 2011 in your country. The following topics should be taken into consideration:
- career and employment security – including job security, income, information, consultation and participation and equal opportunities;
- health and well-being of workers – including health problems, risk exposure, impact of changes in work organisation, and violence, harassment and discriminations;
- developing skills and competences – including qualifications, skills and competences, career prospects and training opportunities
- work-life balance – including issues such as working time, time management at work and social infrastructures.
For answering this question, please make use of all national sources of data on working conditions such as national surveys, quantitative and qualitative research and administrative reports (for example, from the labour inspectorate or health and safety authorities). Please report also on policies, programmes or initiatives implemented at national and regional/local levels by public institutions and social partners. Please make sure you are not reporting the information already provided in question 2.
Under the career heading above, figures published by Ireland’s Central Statistics Office in August 2011 indicate that the unadjusted gender pay gap in Ireland was 12.8% in October 2009 compared with 12.4% in October 2008. The National Employment Survey 2008 and 2009 found that, in October 2009, men were more significantly represented in higher earnings brackets than women and a far higher proportion of female employees worked part-time than male employees. The latter partly explains the gender pay gap, the CSO suggest.
In relation to employee well-being, researchers involved in the National Centre for Partnership and Performance’s (NCPP) 2009 National Workplace Employee Survey suggest that the current economic recession, in terms of experience of staff reductions and the re-organization of the company/organization, has had a significantly negative effect on a range of employee well-being measures – reducing job satisfaction, increasing work pressure, increasing work–life conflict and reducing organisational commitment. For example, the researchers suggest the increase in work pressure/intensity experienced by employees between the first survey in 2003 and 2009 seems to be partly linked to the economic downturn, such as the knock-on effect from staff cuts or increased competition for markets/contracts. Increased work intensity could also arise, they suggest, from new forms of work organization and changing work practices, for example increased responsibility for employees, upskilling and new technology.
On developing skills, the NCPP National Workplace Employee Survey 2009 concludes that despite the strong policy focus on skills, the proportion of employees who had participated in employer-provided training over the previous two years remained virtually unchanged between 2003 and 2009, standing at just under 50 per cent. It places Ireland in the mid-range in international comparisons of the incidence of employer-sponsored workplace training, behind best-practice EU countries in this regard. The profile of worker participation in employee training has remained unchanged in the current economic crisis, as it continues to favour better educated employees and those higher up the occupational hierarchy.
With regard to work-life balance, a new study on workplace equality and flexible working in the recession published in 2011 has found that in 2009, 30% of employees worked flexible hours, including flexitime, 25% worked part-time, 12% regularly worked from home and 9% were job-sharing. This represents a marked increase compared to a study carried out in 2003. The report, ‘Workplace Equality in the Recession? The Incidence and Impact of Equality Policies and Flexible Working’, was written by Helen Russell and Frances McGinnity of the Economic and Social Research Institute (ESRI), and commissioned by the Equality Authority. This study draws on data from the National Workplace Survey 2009, collected after Ireland had entered a recession.
7 Industrial action (200 words)
Please give brief details of strikes and other industrial action during 2011, including:
- statistics on the number of strikes, workers involved and working days lost (absolute number and per 1,000 workers) for as much of 2011 as is available (please indicate briefly what types of action are or are not included in these figures – eg. are only strikes with a minimum number of workers or days lost included, or is only “official” action included?), and how this compares with previous years; and
- any particularly large or significant strikes/lockouts or other disputes;
There was a very low level of official industrial conflict in Ireland in 2011, indicative perhaps that the economic crisis has further blunted the power of workers. Data from the Central Statistics Office shows that six disputes were in progress in the first nine months of 2011, involving 804 workers and resulting in 3,116 days lost. In comparison, 6,500 days were lost to industrial disputes in the first nine months of 2010. This indicates that despite the break-up of social partnership, levels of industrial strife, particularly in the private sector, remain at the relatively low levels experienced over the past decade or so.
Perhaps the most high-profile dispute in 2011 occurred in the non-union Davenport Hotel. A strike by a number of union members at the hotel was triggered over proposed cuts in pay following the initial lowering of the national minimum wage. The dispute ended up being subject to a binding recommendation by the Labour Court. The Court told Davenport Hotel to reinstate five workers on their contracted rates of pay, having concluded that the employer’s actions “were not fair and reasonable” and that the workers should be paid “all the monies” they would have earned. This dispute was particularly important because it happened during the general election campaign. The then opposition had provided assurances that it would reverse the national minimum wage cut in government (which it subsequently did).
8. Restructuring (250 words)
Please give brief details of major and significant incidences of company restructuring and workforce reductions in 2011 and how they were dealt with, especially where these led to important industrial disputes or collective agreements, or had other notable industrial relations implications.
Significant restructuring and workforce reductions have occurred in the banking and finance sector in 2011, and this will continue in 2012. For example, a redundancy package was unveiled in September 2011 for employees of the state-owned Anglo Irish Bank staff, following months of deliberations within the Department of Finance. Anglo’s offer was pitched at 4 weeks' base pay per year of service, inclusive of statutory redundancy entitlement, up to a payment cap of €175,000. The package is highly significant, given that several other redundancy plans in the banking industry have effectively been on hold as the industry - and the various trade unions - waited to see what level of payment the Department of Finance would sanction for Anglo. Industrial relations observers expect that the level of job losses across the banking and finance sector, which has been relatively low thus far given the scale of the crisis, will pick up dramatically in the short to medium term. Industry sources suggest that the already-announced 2,000 proposed job cuts in Allied Irish Bank (AIB) could rise to 2,500; Bank of Ireland already plans 750; some 500 are likely to go at EBS; all 1,300 will go at Anglo over time (starting with 130); and perhaps as many as 1,000 could be lost at Permanent TSB, as that organization may be absorbed into a larger bank, such as AIB. The spike in redundancies in this sector has arisen due to the fact that the banks are either state-owned or state dependent, and because of their contributory role in causing the ongoing crisis.
Some major restructuring agreements have been concluded between employers and trade unions in the financial services sector, and have been outlined in Industrial Relations News. Most noticeably, a three-year pay freeze in return for a guarantee of no compulsory redundancies is at the core of an innovative restructuring agreement between FBD Insurance, the Unite union and the Field Staff Association. The agreement also includes the elimination of pay increments and the introduction of new performance measurement standards. Negotiators believe that the deal transforms the competitive outlook for a company that relies on business in the Republic of Ireland, at a time when the economy is being squeezed.
Outside the banking and finance sector, a major restructuring agreement, published in Industrial Relations News, was agreed between management and unions at telecommunications company eircom in spring 2011, aimed at removing €92m from the company’s cost base over a three-year period. The ‘eircom Rescue Plan Framework Agreement’ is broken into two distinct phases. Stage One, dealing with cost recovery measures to be implemented as soon as possible, contains the following key proposals:
- A pay freeze, involving no general pay increases prior to the end of 2013.
- A 10% reduction in working time and equivalent reduction in pay for a period of eighteen months, “commencing as soon as operationally practical”. This reduced working schedule is to be achieved, in general, through the introduction of a nine-day fortnight.
- Measures are being introduced with the aim of placing limits on the accumulation of annual leave. If leave for a particular is not taken in that year, it has to be used in equal phases over the following three years, or it may be forfeited.
- Headcount reductions will be necessary. No figure is being specified. Media speculation has centred on the figure of around 1,000 further ‘exits.’
- The exit/severance package is to be maintained at six weeks’ pay per year of service, plus statutory redundancy.
Under Stage Two, there is a checklist of proposed modernization reforms, which would be subject to negotiation between the parties, with a view to full implementation no later than July 1, 2012. These proposed measures include:
- Immediate review of daily subsistence rates, with a view to cost reduction.
- Immediate engagement with the Labour Relations Commission and Labour Court on the deployment of GPS technology and revised time in lieu arrangements, and a reversion to more traditional overtime arrangements.
- Restructuring of the field force.
- Mechanisms for managing displaced staff, including the examination of a Reserve Workforce model and other possible outsourcing models.
- New attendance models “which reflect the new customer expectations and the need for more flexible cover arrangements”.
- A competency-based system for selection, to include location, skills and experience.
- Discussions on new payroll arrangements, including E-payslips and a move from weekly to fortnightly pay arrangements.
- Compensation for loss of earnings, and acting and ‘on call’ allowances.
- Immediate engagement to explore the establishment of a performance-related bonus scheme for graded staff, linked directly to company financial performance and to individual and team performance.
- Immediate engagement to explore how the recruitment of new skills and the building of new capabilities will be delivered.
- Apprentices/trainees: it is planned to recruit 50 initially by July 2011, under terms and conditions yet to be agreed. They will be the first apprentices to be recruited by eircom since the 1980s.
- The establishment of an ‘eircom university’, in order to “build business critical capabilities and develop employees”.
9. Other relevant developments (150 words)
If there been any other significant developments affecting employment relations in 2011 that have not been mentioned above, please give brief details.
Tony Dobbins (Bangor University) and Brian Sheehan (IRN Publishing)