Congress advises private sector unions to seek baseline pay increases ranging between 3.5% and 4.5% in 2020

3 Dec 2019

Public Sector Bulletin, Winter 2019

The Congress Private Sector Committee (PSC) is advising unions in the private sector to seek baseline pay increases ranging between 3.5% and 4.5% in 2020.

Congress General Secretary Patricia King said that “despite the fact that average yearly earnings increased by 4.7% year- on- year in the private sector in Q3 2019, all the indicators demonstrate that Ireland remains a low pay economy.  According to EADS (Earnings Analysis CSO), median weekly earnings (2018) stood at €592.60 per week or €30,815 per annum. 

Furthermore, in the Accommodation and Food sector, 68.1% of workers earn below €400 per week. In addition, 43.9% in Wholesale and Retail earn less than €400 per week. The position of female workers is even more stark, with the median weekly wage being €523.25 or €27,209 per annum. Low pay is also endemic amongst young workers”.

Congress advocates that the statutory wage-setting mechanisms currently in place have been rendered useless by an effective veto exercised by the employers through non-participation in the Joint Labour Committees (JLC’s) system. Congress has been calling for legislative reform to ensure that the system of JLC’s can function more effectively. Structured collective bargaining is one of the most effective means of eliminating low pay and Government must act to support the functioning of collective bargaining.

Mandate General Secretary John Douglas said that “the retail and hospitality sectors are an example of the kinds of employment where employers need to engage with unions in terms of wages and conditions. It is time to call out employers and it was time that workers in low paid sectors were treated fairly”. 

Dr.Tom McDonnell, of the Nevin Economic Research Institute, (NERI) said “while poverty and deprivation were falling, one in six people are experiencing deprivation and can only manage to pay for basic essentials, for instance, some may have to do without new shoes or clothes. He said “Ireland has a very high level of market inequality before tax and therefore social welfare payments have to compensate, this in effect subsidises low pay.

Dr.McDonnell said, “in terms of our labour market performance he said we are a mid-level performer but our performance relative to other EU countries is a long way behind unemployment figures in Germany, Poland and the UK”.

Read the full bulletin here.