Construction federation seeks to reduce workers' pay by 10%

THE CONSTRUCTION Industry Federation (CIF) will today begin moves at the Labour Court to have rates of pay for building workers reduced by 10 per cent.

The move would involve an alteration to the registered employment agreement which governs pay rates for craft workers and general operatives in the construction sector.

The Labour Court, with which the agreement is registered, will also hear a claim by the Irish Congress of Trade Unions (Ictu) for increases of 6 per cent over 21 months for workers in the building sector. This is in line with the terms of the national pay agreement signed last autumn.

In its submission to the Labour Court, the federation said the reduction was vital to save jobs in the industry given the Government’s demand for lower tender prices for public capital projects, the use of fixed-price lump sum contracts which prevented companies claiming for any pay rises and pressure from private clients for reduced prices.

It said labour costs in construction were “completely out of sync with the requirements of the Irish economy to make itself competitive again”.

“The court should be aware that 55,000 construction jobs are at immediate risk over the next five months due to a lack of demand in the economy for construction services,” its submission said.

Ictu’s submission said by the time the Labour Court made a recommendation and registered a new agreement, employers would have benefited from a 10-month pay pause. It would be wrong to present a picture of a general collapse in construction and claims that a pay increase would put companies out of business were misleading.

“All companies have not collapsed and although tender prices have dropped considerably in the second half of 2008, this must be viewed in the context of a decline from a very high base.

“In addition, construction firms have not had to absorb these declining tender prices in full as they have in part been offset by falls in the price of some construction materials and a pay pause which has now been effective for some eight months.”

Ictu said between 2003 and 2007, wages increased at only one-third of the pace of profit growth.

The federation’s director general Tom Parlon said last night: “Looking for a 6 per cent pay increase when 7,000 jobs are being lost each month beggars belief.”

The chairman of Ictu’s construction industry committee, Noel Dowling, said attempts to dismantle the employment agreement would prove disastrous.