Strikes possible if Government or banks unilaterally impose pay

Widespread bank strikes are looming if the Government or banks try to impose pay cuts on bank officials over the next few weeks, Larry Broderick, the general secretary of the Irish Bank Officials Association (IBOA), warned yesterday.

“If any bank or Government tries to impose a pay cut for bank workers on a unilateral basis, then the IBOA will exercise our internal democracy by asking members to consider our response — up to and including industrial action — in order to prevent the further cannibalising of our members’ pay,” said Mr Broderick, speaking at an IBOA conference in Croke Park yesterday.

The Government has asked AIB, Bank of Ireland and Permanent TSB to come back with proposals to cut their payroll and pension costs within the next two weeks. This follows a Government-commissioned Mercer Report into remuneration levels in the sector which was released in March. The Government is looking for pay cuts of between 6-10%.

Mr Broderick argued that the findings of the Mercer Report were flawed because the IBOA was not consulted as part of the review.

“They [Mercer] refused to agree joint terms of reference. They did not engage with the union on any aspect of the report and, indeed, shared their findings with the Boards of each bank and sought approval before issuing the report, and totally refused engagement with the union.

“While the report is helpful in some respects, it is fundamentally flawed in the following areas: The purported average increases for bank staff are not reflective of the fact that, since 2010, IBOA members have received no increases either cost-of-living or contractual. The report fails to identify how it reached its conclusion but, unbelievably, relied upon internal information from the management of the banks, including payments made in promotion, retention payments and bonuses to key senior people in the bank to calculate their average increases.”

They do not make any recommendation on pay but set out optionsto be considered.”

Mr Broderick said the blame for the implosion of the financial sector lay with senior bank executives — many of whom have retired on gold-plated pensions. Moreover, there were a number of executives currently in key roles who are in receipt of exorbitant pay packages, he added.

Bank of Ireland chief executive, Richie Boucher’s salary of €843k drew a huge amount of criticism from opposition parties during the week. Politicians urged Michael Noonan, the finance minister, to vote against Mr Boucher’s remuneration package at the AGM on wednesday.

Taoiseach Enda Kenny said in a Dáil debate that he expected “substantial cuts” in bank executives’ pay when the cost reduction proposals are submitted.