Group seeks 20% paycut for construction workers

THE Construction Industry Federation (CIF) is to seek a further 20% cut in the legally binding pay rates for up to 50,000 site-based workers in the industry.

The rate, set by a registered employment agreement (REA) for the industry, was cut by 7.5% in February last year, and at that point it was agreed that it would be reviewed every year.

While the federation has not publicly stated a figure, it is understood it will be looking for a cut of 20% to reflect what it sees as the continued loss of momentum in the sector and unprecedented unemployment. It believes the total employed in construction-related areas could fall from 100,000 at present to 75,000.

The CIF believes existing rates under the REA are creating a “rampant black economy” in certain sectors and are encouraging contractors from the North to flaunt the agreement here.

In last year’s Labour Court ruling on the REA, the court said the 7.5% reductions should be regarded as a “temporary measure of derogation from the current REA rates and their continued application should be reviewed in January 2012”, and each subsequent year.

“Those reviews should have full regard to the prevailing circumstances of the industry and other relevant considerations,” it said.

The CIF made a detailed submission to the Duffy Walsh review group set up to look at the operation of Joint Labour Committee and REA wage agreements. It said it was underwhelmed by the draft reform legislation announced before Christmas by Enterprise Minister Richard Bruton.

It is understood that the CIF raised these concerns with the troika when they met yesterday.

The CIF delegation included its director general, Tom Parlon, president Matt Gallagher, and its current director of communications, Martin Whelan, who is leaving the organisation to take up a role as a Government liaison within NAMA in mid- February.

The federation has previously argued that “termination dates” should be inserted in such wage agreements to prevent sectors, such as construction, from becoming stranded indefinitely with uncompetitive wage rates.

The CIF has also argued that future wage agreements in Ireland should be guided by expert independent analyses of wage trends elsewhere. It said it believed negotiating wages needs to be about more than just finding a compromise between two parties, but rather should be driven by the needs of the economy.

“There is no secret that the CIF views existing wage levels in the sector as a major barrier to the necessary competitiveness adjustment,” said a federation spokesman.

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