Eircom and unions agree 5% pay rise for staff over next four years
Bonuses and other payments to be put in place in return for changes to work practices
Apax Partners, CVC Capital Partners, and KKR are reported to be among the private equity groups that have been approached to form a consortium to acquire Eircom.
Eircom staff are in line for a 5 per cent pay increase over the next four years following a deal struck by the company and its unions. Bonuses and other payments are to be put in place also for certain grades of staff in return for changes to work practices.
The deal was agreed through the Labour Relations Commission with workers to be balloted on the proposals this month.
Under the deal, staff will receive a 2.5 per cent pay increase with effect from July 1st next year. An additional 1.25 per cent will be paid a year later followed by the same percentage increase on July 1st 2017.
Both sides have agreed that there would then be no further pay increases until July 2018.
Voluntary departuresA pay freeze has been in place at Eircom since 2008. The company is now in the final stages of a voluntary leaving scheme that will reduce its headcount by 2,000 to about 3,500.
In addition to the pay rises, all graded employees will received a once-off, non-pensionable productivity payment of €875 this month. Bonuses of up to 3 per cent are also to be made available to certain grades of employees, based on the delivery of certain cost-saving measures.
These include more flexible cover arrangements for customer appointments. Agreement on the further implementation of global positioning systems by the company is also being sought, and there will be a review of the daily subsistence rates in line with guidelines from the Revenue Commissioner in order to reduce costs.
Separately, Apax Partners, CVC Capital Partners, and KKR are reported to be among the private equity groups that have been approached to form a consortium to acquire the company. Discussions with private-equity firms are at an early stage, according to Bloomberg.
Eircom has appointed Goldman Sachs, Morgan Stanley, and Rothschild to advise it on its strategic options. Irish stockbrokers Davy and Goodbody have also been engaged. It is known to be considering an IPO but has not ruled out a private sale of the company.