Minister for Enterprise Richard Bruton has said the Government is committed to reforming the mechanism setting rates paid to people working in the hotels, restaurants and retailing sectors.
Speaking today after reports that the EU and IMF were concerned the Government was backsliding on goals linked to the bailout, Mr Bruton said he was confident wage-setting mechanisms could be reformed and that he intended to move quickly on the matter.
Officials from the EU and IMF last night said anything which raised any doubt about the Government's determination to proceed with the rescue plan was very unhelpful.
"I think reform will never satisfy everyone 100 per cent but I think what we will do is bring forward a package of reform to Government and I'm confident we will see quick reform in this area," Mr Bruton said.
"I believe it's important because there are job creation opportunities by reforming here, we've been told that by experts, and it's something I believe strongly myself."
The Department of Enterprise is currently engaged in discussions with unions, employer representatives and the EU-IMF about his proposals to alter the wage-setting mechanisms. Those talks are due to end today and Mr Bruton is to bring proposals to Cabinet by June 21st.
Irish Congress of Trade Unions president Jack O'Connor said the comments from Ireland's international backers were “deeply concerning and suspicious”.
He described the remarks as "more than coincidental just as the Cabinet is about to discuss the issue. The intervention is clearly designed to leverage pressure in favour of the wage cutting agenda".
Mr O'Connor said the "Memorandum of Agreement with the Troika does not specify such wage cutting. It merely provides for a review of the relevant statutory mechanisms".
Mr Bruton denied that reforming the mechanisms, which apply to around 200,000 lower paid workers, was simply a means to reduce pay. Members of the Labour Party have shown resistance to the proposal which has been described as an attack on the State's most vulnerable workers.
The Minister said workers had protections in their contracts and that reforming the sector was a move he hoped it would lead to job creation which would help to lift people out of poverty rather than drag them into it.
"What we're changing is the law that sets standards, so by changing that obviously there's opportunity immediately for new recruits but to change existing terms, employers would have to negotiate change with their employees," he said.
"So what we're doing is pulling away some of the elements of statutory control that make the system too inflexible to respond to changed opportunities."
Separately, Mr Bruton declined to comment on comments by RTE director general Noel Curran suggesting high earners at the broadcaster would face substantial pay cuts before 2013.
However, he did say companies had to respond to challenges arising in the current straitened times.