Industrial relations

Ireland: Latest developments in working life Q3 2019

A new policy to boost collective bargaining launched by ICTU, trade union membership statistics, increases in allowances for the defence forces, growing unemployment among young workers and data highlighting the gender pension gap are the main topics of interest in this article. This country update reports on the latest developments in working life in Ireland in the third quarter of 2019.

ICTU aims to harmonise collective bargaining laws

The Irish Congress of Trade Unions (ICTU) launched a new policy on collective bargaining at its biennial conference in July. [1] The new policy focuses on the adoption of an EU Directive to ‘harmonise the laws of EU Member States on collective bargaining and thereby establish the right to bargain in Irish law’. [2]

This directive is in line with Article 28 of the Charter of Fundamental Rights of the European Union, which guarantees the rights of workers and employers to engage in collective bargaining. The new congress policy document suggests that relying on this article and harmonising with EU law could help to overcome the potential constitutional impediments to national legislation on collective bargaining.

Women union members in the majority

A majority of the members of unions who are affiliated with the ICTU are women, according to figures published by the ICTU in 2019. Total female membership of ICTU affiliates stands at 54.5%, with 67.4% of women in the public sector and 32.6% in the private sector. However, overall union membership across both sectors is down by 1.5% from two years ago, despite the recent economic recovery.

Across the whole of Ireland, a majority of the members of unions affiliated with the ICTU work in the public sector (52.5%). In the Republic of Ireland, a majority work in the private sector (52.2%).

Increase in allowances for defence forces

The Public Service Pay Commission published a report on recruitment and retention in the defence forces in July, which recommended increasing several allowances immediately. The report’s main findings were accepted by the government and Paschal Donohoe, Minister for Public Expenditure and Reform, announced a €10 million package of measures to improve the allowances of the defence forces. [3]

The proposed amendments include a 10% increase in the Military Service Allowance paid to most personnel, with a minimum increase of approximately €350 per year.

Given that military allowances represent about 20% of the Defence Forces pay bill, a 10% increase to most allowances would mean about a 2% increase in the expenditure on wages, over and above the basic increases under the current Public Service Stability Agreement.

The commission also proposed to reverse the cuts that were made to other allowances under the 2013 Public Service Agreement. These included the Security Duty Allowance (Patrol Duty in the Naval Service), the Overseas Peace Support Allowance, and the Overseas Armed Peace Support Allowance.

Private sector pay analysed

Figures published by the Industrial Relations News (IRN) Journal show that in the first half of 2019 private sector pay bargaining saw an increase in annual percentage outcomes. Almost one-quarter of the 80 deals analysed fell outside the 2% to 3% range, although the average was still around 2.5% a year.

Some sectors averaged close to 3% (for example, pharmaceuticals and construction), while others were closer to 2% (for example, food and engineering). Additional benefits like vouchers, bonuses and service pay were particularly common in the manufacturing sector.

Younger workers struggling in the labour market

The 2008 economic recession led to important structural changes in the Irish labour market. While there has been growth in wages and employment since the crisis, a paper from the Nevin Economic Research Institute (NERI) finds that some sectors and types of worker (such as young and/or male) have been left behind. [4] It also highlights that the overall unemployment rate remains higher than before the recession.

In 2018, there were 36,000 more unemployed people and 23,000 more long-term unemployed people than in 2005. These groups include a significant number of younger people, particularly men. Also, while the female labour market participation rate is around the EU average, it is below the best performing European economies due to the high cost of childcare.

The paper suggests that recent economic growth is threatening to leave younger workers behind. While precarious employment has stabilised, part-time unemployment and under-employment (working part time due to lack of full time posts) are still much higher than in 2007, particularly for younger workers. This widening gap between younger and older workers is particularly prevalent among male workers.

The paper also says that 32% of all employees under the age of 25 were earning equal to or less than the national minimum wage.

Gender pension gap revealed

New research from the Economic and Social Research Institute (ESRI) shows that the average total weekly pension income was €280 for women and €433 for men in 2010, indicating a gender pension gap of approximately 35%. [5]

The study says that this gender pension gap was due to differences in incomes from private and occupational pensions. It found that 55% of retired men received a private or occupational pension, compared to only 28% of women.

For occupational and private pensions, the research establishes that lower relative years of work experience among women increases the gender pension gap.

The study shows that there was a significant difference in the number of years that men and women worked before retiring, with 93% of men working for more than 30 years and only 33% of women doing the same. In contrast, 3% of retired men had never worked, compared to 22% of retired women.

The ESRI says that higher levels of female educational attainment reduced the gender pension gap.


Footnotes

  1. ^ ICTU (2019), Realising the transformative effect of social dialogue and collective bargaining in Ireland , Dublin.
  2. ^ Irish Examiner (2019), ICTU urged to renew effort to secure right to collective bargaining , 2 July.
  3. ^ Irish Times (2019), Government to propose new pay review for Defence Force specialists , 3 July.
  4. ^ NERI (2019), Labour market trends in the Republic of Ireland (2019) , NERI Working Paper Series, No. 62, Belfast.
  5. ^ ESRI (2019), Gender, pensions and income in retirement , Research Series, No. 87, Dublin.

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