Union leader backs 7% pay rise

ONE of the country’s main union leaders yesterday gave his full backing to the proposed new pay deal that promises a 7% increase to private sector workers.

Irish Congress of Trade Unions general secretary David Begg said that he believed the proposed terms of the new 18-month partnership deal were satisfactory. However, he warned that more work was needed over the next fortnight before Congress could decide on whether or not to recommend the social agenda of the proposed deal.

"I am pleased with the elements of the social agenda that proposes to raise the minimum wage by 10%," Mr Begg added.

Asked if he was satisfied the proposed 7% pay hike would beat inflation especially when Congress got it wrong on the inflation figures in the last deal Mr Begg replied: "I am satisfied it will beat the forecasted rate of inflation by 0.5% to 1% giving a real rise in the standard of living."

Both unions and employers have an agreed position to do everything possible to dampen inflation over the next 18 months, Mr Begg said.

While the Congress leader accepted that employees in some private companies were prepared to accept wage cuts to save their jobs, he said that the proposed deal was designed to keep the economy on track and protect jobs.

However, it was claimed yesterday the proposed increased redundancy payments would lead to major job losses. It is proposed to increase redundancy payments from a half week for every year worked for those under 41 to two weeks for every year worked for all employees.

However, a top Dublin accountant has already advised client companies to lay off staff sooner to avoid paying out more to redundant workers under the proposed changes.

Furthermore, small and medium sized companies have also warned of increased lay-offs and redundancies because they will not be able to afford the proposed 7% pay increases.

However, the unions rejected the claim that the proposed redundancy payment increases would lead to more job losses.

Mr Begg said that the proposed increases will be a significant benefit to people who lose jobs.

Meanwhile, talks between public service employers and unions on conditions for payments of benchmarking awards for public servants will resume in Government Buildings today.