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Trade Unions: Giving beards a bad name?
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Exchanges between the TEEU’s Eamon Devoy and the CIF’s Tom Parlon became heated on the Pat Kenny show this morning. Devoy taunted Parlon that the TEEU have “closed down all your businesses and they won’t open again until we say so,” or words to that effect, which was enough to make Kenny draw in his breath and suggest that perhaps the pair might go off and have a cup of coffee. Given the mood they were in, that not might not have been the wisest course of action to advise, unless one notified the burns unit of the nearest hospital in advance.
Parlon has dubbed the TEEU ‘lunatics’, which doesn’t help things much either. Jack O’Connor of SIPTU has offered the full support of his union to their strike. The head of the Labour Relations Commission, who spent a long hard day last Saturday trying to bang heads together, was evenutally forced to concede there is no basis for talks at the moment. So the strike went ahead on Monday, as planned, and already Diageo have secured an injunction to prevent picketing at Guinnesses; Cadburys are applying for a similar injunction and no doubt there will be more firms queuing up for a Judge’s signature on their applications before the week is out. Or else, they may be closing their premises and letting workers go; some of whom may not be taken back when the conflict, which had nothing to do with them is the first place, is finally resolved. As for the big construction projects throughout the country, building firms stand to lose millions if the dispute closes down their sites or delays completion of work to agreed contractual deadlines.
So far, public reaction to the strike has been divided, but more inclined to outrage against the unions and the parallel universe they are deemed to inhabit than support for their cause. Listening to Jack O’Connor on the radio earlier in the day and watching Eamon Devoy on Vincent Browne late last night neither man appeared capable of articulating a case that rose above sectional self-interest, prompting the idle and despairing thought that these men are giving beards a bad name. And that has to be difficult, especially when it’s teh CIF you’re up against.
It’s a complex dispute, but at the centre of it lies the registered employment agreement for electricians pay. The union claims electricians have not received a pay increase under the terms of the REA, to which they are bound, for over two years and that an increase already sanctioned by the REA for 2007 has not been paid. The employers argue that the increase agreed in principle with the union for 2007 was not registered with the Labour Court because a court case intervened – taken by a breakaway group of employers challenging the right of the Labour Court to register an REA setting pay rates for their entiire employment sector – and that by the time they all got back to it, circumstances had changed and the construction bubble had burst. So the union claims an 11% plus pay rise, about half of which relates back to the 2007 missed payment, whilst the employers are demanding a 10% wage cut on existing hourly rates of pay for electricians.
Registered Employment Agreements are an anachronism. Relatively few of them exist and they are mainly confined to pay and pensions in the construction sector. That was not the intention when they were first brought forward as a mechanism by Sean Lemass as part of the Industrial Relations Bill establishing the Labour Court in 1946. Lemass and his fellow legislators envisaged REAs having a major role as part of a new voluntarist model of industrial relations in Ireland. REAs would encompass a wide range of employment groups throughout the private sector, it was hoped. Representative groups of employers and registered trade unions would arrive at an agreement in a Joint Industrial Council that, when formally registered by the Labour Court, would then be legally binding on all employers and unions throughout that employment sector. At the time it was viewed as an alternative to undesirable government intervention in setting pay rates for workers in private employment. For its time, it was a progressive and innovative concept.
It was also a trap – because once you were covered by an REA there was no way out of it, for employers or workers. As a mechanism, it has also long been overtaken by events like national wage rounds and social partnership.
Thus the TEEU are fighting for more than a pay claim. From their perspective, the REA, which sets minimum hourly rates for all electricians throughout the country, is a bulwark against employers seeking to eliminate that basic rate and either drag it down, or even have the REA model collapse entirely. This also appears to be on Jack O’Connor’s mind – if the electricians’ union loses this dispute then other workers in the construction sector will be next in line and wage rates under their own REA might ultimately deteriorate to minimum wage levels.
For the government, the stakes are evn higher than for the parties immediately involved. The dispute has potential to cause huge economic damage, especaially in the productive sector which has been holding its own against the worst effects of the recession, thus far at least. Anything that casts doubt on the stability of industrial relations in Ireland is also bad for the country’s already shaky international credit ratings. And with some very difficult terrain ahead, in terms of cuts in public spending, public service reform, and all the other unpleasantnesses that have to be dished up in the autumn, this dispute may prove to be a taste of things to come.
So the employers agreed to a pay rise schedule, a subset of the employers challanged that unsuccessfully, and when that was done and dusted the employers said they couldn’t pay the pay rise – even though the electricians are pointing out that the employers were charging higher fees for work done to account for the pay rises agreed to but not handed out.
And now the electricians are being blamed because they’re a bit miffed at being done out of 10% of their wages for two years and then asked to take a 10% pay cut by people who were creaming the 10% pay rise money off the top for those two years?
Or did I read all that wrong?
“the electricians are pointing out that the employers were charging higher fees for work done to account for the pay rises agreed to but not handed out.” as indicated in VB last night that is not precisely true. And the unions haven’t shown it to be the case either. They’ve talked about some hypothetical alright but no specific examples.
When negotiating the contracts with their clients the contractors would have built into the contract that should certain costs (like for new wage agreements, or the price of components) rise that those rises which must be transparent could be passed onto the client. That would be one of the reasons that projects have cost overruns. However, as the increase never came into effect the contractors didn’t pass on the increase to their clients and so didn’t collect extra money. It is not actually easy to go back to clients now for work done in 2007/2008 and which has been long completed and handed over, which are essentially done and dusted and just say, oh by the way we want more money to cover this agreement we’re now deciding to honour. I know if I was a client who had taken possession of a building and was operating in these straitened times and some was coming to me a year or two later looking for money I’d be putting them at the end of the queue compared to paying my day to day running costs.
Also, the problem for the unions is that one of the contractors the bloke on VB last night is saying they never ratified the agreement. It is not unknown for a negotiator to make an agreement but for those on behalf of whom they were operating to reject it. It happens on the union side all the time, so why was it a big deal for Eamon Devoy last night to get his head around? Hell’s bells, Wilson agreed to the formation of the League of Nations but congress stopped the US joining it.
So they’d agreed to the pay rise, charged the clients for the increased cost, then a subset of employers brought a legal challange and lost, and now the electricians want the money agreed upon in the first place, but the employers didn’t collect it from the clients?
Well:
if only a subset of employers brought the challange, why did all the employers act as though the challange was won?
why are the electricians being asked to pay for the employer’s error like this?
why is there so much animosity for electricians looking out for their own interests when it seems self-evident from the facts that nobody else will look out for them?
So they’d agreed to the pay rise, charged the clients for the increased cost
Is there evidence for that?
What I wonder is…
are the union leaders electricians?
when was the last time they were working on a site?
is their salary the rate they are “fighting for” or is it much higher?
how safe is their job?
do they really care of their union members employment?
I’m not saying the demands are not fine, they probably are, but:
a: if they want the arrears, then quite some companies will go out of business.
b: in the current climate, just keeping the wages will probably send out of business quite a few companies
c: keeping the strike for a few days more will certainly close down a few small companies.
No matter what, the electrians will pay the price for all this, and in the meantime the country will just be discarded by international firms because of the high labour costs and how a dispute not related to their business can affect them.
So… nice lose or lose situation… for everybody.
@Mark Dennehy
You ask
“So they’d agreed to the pay rise, charged the clients for the increased cost, then a subset of employers brought a legal challange and lost, and now the electricians want the money agreed upon in the first place, but the employers didn’t collect it from the clients?”
No, that doesn’t appear to be the case. By my understanding the employers had allowed for increases in rates to be passed onto the client if the rate increase came into operation across the sector, if the increase didn’t come in then the client wasn’t charged.
“1. why is there so much animosity for electricians looking out for their own interests when it seems self-evident from the facts that nobody else will look out for them?
2. if only a subset of employers brought the challange, why did all the employers act as though the challange was won?
3. why are the electricians being asked to pay for the employer’s error like this?”
1. Because the electricians looking out for themselves now when people are losing their jobs, when electricians didn’t exactly suffer for the last few years, when they have the ability to destroy what is left of the construction sector, when they have the ability to destroy tens of thousand of jobs indirectly-related to the construction sector, when nobody in the world is getting 11% pay increases, when times have changed massively since the agreement was made – is seen as way, way more selfish than anything that happened in the last few years regards level of self-interest.
2. For reasons related to competition. If you’re tendering for a contract and incorporating the higher staffing costs you’re not likely to win the contract against a rival who is not.
3. I don’t think they are…
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I’d echo Big Fredi’s comment on it being a lose-lose situation, not alone for employers and workers but for the country as a whole.
Reading through the comments leads me to think… if you were the trade union leadership and you wanted to pick an issue to make a stand on against wage reductions nationally, to fire a shot against the bows of the employers and the government, then you wouldn’t pick something as complex as the electricians’ pay claim, now would you? Not smart at all really. As for what it does for beards!
Meanwhile, the government, predictably , has asked the LRC to pick up the pieces and start banging heads together again.
As someone involved in the Electical industry, I can confirm that these increases have been passed on to the client, with the contractors then adding their percentage on top of that again, win/win for the contractors. I also agree that the electricians wages are unsustainable at present but there are several ways that the contractors associations could make symbolic payment for these increases, I’m thinking about time off for training with pay,(I’m sure the government would help fund instead of people going on the dole). New Zealand has put a plan similiar to this, a 9 day woring fortnght with the 10th day spent at a training college upskilling. This would be a win/win/win situation electricians/contractors/goverment