Trade union leaders and Government officials have reached an agreement on public sector pay and widespread reform of the public service following lengthy talks chaired by senior officials of the Labour Relations Commission.
Under the deal, which was agreed at 3am this morning, the Government has given a commitment that there will be no further cuts in public sector pay until 2014 at least.
The trade unions, for their part, have agreed to implement extensive reforms in work practices and conditions of employment throughout the entire public service.
The Labour Relations Commission said that most if not all unions had agreed to its request to move immediately to consider a cessation of industrial action that is currently underway.
The deal, which now has to be presented to union members in ballots, does not contain specific guarantees on reversing pay cuts that were put in place in the Budget last December.
However there will be a review of public sector pay in spring of next year and in each subsequent years. These will take account of “sustainable” savings generated as a result of the implementation of the reform programme and determine if there is any scope for the re-imbursement of pay cuts.
It is unclear the proportion of lost pay that would be re-imbursed and over what timescale.
The agreement says that in the event of “sufficient” savings being identified in the review to be carried out in early 2011 that priority will be given to public servants with pay rates of €35,000 or less.
The savings produced as a result of the implementation of the reform programme are to be independently verified by a new Implementation Body which is to be established.
The deal says that the issue of how pension increases for current staff and those who have already retired are determined - whether they will continue to be based on rises awarded to serving personnel - will be considered in the context of the review of pay policy next spring.
In the meantime the current position whereby pay cuts introduced in the Budget are not counted in calculating pension entitlements will continue for another year.
The deal says that the Government intends to introduce a significant re-structuring and re-organisation of the public service in the coming years.
It states that the new agreement on the public sector will allow the numbers employed “to reduce substantially over the coming years in accordance with a new public service numbers policy which will facilitate a progressive reduction in staff numbers across the public service by end-2012 and will be implemented by employment control frameworks”.
It says the current Government moratorium on recruitment and promotion will continue to apply until numbers employed in each sector have fallen to the levels set out in these new employment control frameworks.
The deal also says the Government may offer voluntary measures for staff to leave the public service but that there will be no compulsory redundancies in the public service subject to the compliance with the terms of the agreement and in particular to the new provisions on flexibility and re-deployment being implemented.
The deal says flexible re-deployment of staff is necessary to sustain the commitment to job security within the public service. It says the parties have agreed to the re-deployment of staff, within and across each sector.
“If it is not feasible to re-deploy within the sector, cross-sectoral re-deployment may take place, within a geographic area where possible, having regard to the arrangements agreed in respect of non-commercial semi-State bodies," it says.
The deal says that to maintain the delivery of public services at the same time as reducing numbers, the parties accept “efficiencies will need to be maximised and productivity in the use of resources greatly increased through revised work practices and other initiatives”.
It also maintains the Government will move to dismantle barriers to the development of a unified public service labour market and, to the greatest extent possible, there will be standardised terms and conditions of employment across the public service.
“In that context, the parties have agreed to review and revise contractual or other arrangements or practices which generate inflexibility or restrict mobility," it states.
The deal says in the future merit-based, competitive promotion will be the norm and promotion and incremental progression in all cases will be linked to performance.
The deal also contains an industrial relations peace clause. The parties have agreed that no cost-increasing claims can be made for improvements in pay or conditions for the duration of the agreement while strikes or other forms of industrial action in respect of matters covered by the deal will be banned.
However the deal says the implementation of the measures set out in the document is subject to there being no unforeseen deterioration in the Government’s finances.
Welcoming the outcome of the discussions, Taoiseach Brian Cowen said the agreement will “provide confidence and stability in the public service to meet both current and future challenges”.
Mr Cowen said both sides had made “very significant efforts” during the “complex” negotiations but he felt the deal will result in “greater efficiency, better services for the citizen and more satisfactory working conditions for public servants".
He said: “We now have an agreed shared vision for transformation in all sectors of the public service, and an agreed path on how it is to be achieved.
“This agreement will ensure that together we can create a public service of which we can be proud and a public service which we can afford.”