Building body urges wage action to boost job growth

THE Government is coming under further pressure over its plans to reform the Joint Labour Committee (JLC) system as the Construction Industry Federation (CIF) said proposals to overhaul the system were “totally inadequate”.

The CIF said plans announced by Enterprise Minister Richard Bruton to revise pay agreements for some sectors of the economy would not help achieve the necessary competitive gains, or address the construction industry’s financial difficulties.

The organisation, which represents more than 3,000 building firms, criticised the Government’s focus on low-paid sectors governed by the JLC system, which it said would leave the industry “stranded with high costs”.

Under the existing JLC system, there are 68 separate Registered Employment Agreements (REAs) governing many sectors, including catering, construction, printing, retail and electrical contracting.

A CIF spokesman said the Government’s plans for reform of the JLC system would not help increase potential job growth.

He claimed reform of the REA wage-setting mechanism would result in more jobs being created, as construction employers would be able to supply services at prices homeowners and businesses were willing to pay.

“It would also help counter the growing prevalence of the black economy in construction services and enable Irish employers compete against contractors from Northern Ireland, keeping jobs and revenue in the state,” said the CIF spokesman.

The CIF expressed concern that wage costs in the Republic are up to 40% higher than in the North.

“The entry rate for somebody with no prior experience in the industry is €32,000, higher than the average industrial wage, whilst the average, site-based wage under the REA is €50,000,” said the CIF spokesman.

The Labour Court last year recommended a 7.5% pay cut for construction workers under the sector’s REA because of the dramatic downturn in the building trade. The CIF had sought a cut of 20%.