Aviation Authority faces wage rise bill of €4.5m
The case was referred to an independent assessor to establish whether the authority could afford to pay, over 21 months, the 6% wage increase agreed by the social partners last September.
According to Industrial Relations News, assessor Eugene McMahon was told by representatives of the 700 employees that IAA’s revenue increased in 2008 compared with the previous year.
However, management argued that the crisis facing aviation, with falling traffic volumes, meant it had to introduce cost savings and that included delaying payment of the each phase of the national wage agreement for six months.
It claimed profit had fallen between 2008 and 2007, down from €19.2m to €16.9m, and profit this year would be even less.
The assessment of the IAA case came before the Government last week which indicated it wanted to renegotiate how the national wage agreement would be implemented particularly as it has been paid in some companies but not in others.
Until now, it has been the responsibility of the company to prove its inability to pay the increases.
Under the Government’s proposals, where a union argues a company can afford to pay, it must provide evidence to support its claim.
Meanwhile, according to IRN, the Irish Aviation Authority looks set to ask workers to make a contribution of around 9% to their defined benefit pension scheme, which is understood to be in deficit.
The authority is believed to be seeking to link increases in pensioner pay to inflation, rather than to wage rises given to staff members.
The chief executive, Eamonn Brennan, said recently that the company would have to address the issue with both the Department of Transport and the unions.
Mr Brennan has taken a cut of 10% in his pay this year and is reported as saying he would be prepared to make a major extra financial contribution to his own pension.
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