Court calls for building staff pay cut

The Labour Court has recommended pay cuts of 7.5 per cent for construction workers following the dramatic downturn in the sector.

The court’s recommendation follows an application by the Construction Industry Federation (CIF) seeking cuts in wages of up to 20 per cent.

Prior to the ruling, CIF said it would seek the cancellation of the registered agreement governing pay and conditions in the building sector if the Labour Court did not approve its call for 20 per cent pay cuts.

In its submission to the Labour Court, the CIF argued that the industry was going through probably the most severe and rapid downturn ever experienced.

It said that more than 200,000 employees had lost their jobs and hundreds of companies had folded. “Without immediate action to arrest the situation the industry is in danger of total collapse,” it said.

However, unions said building workers had already seen their earnings reduced by 40-50 per cent as a result of cuts in bonuses, piece rates and overtime.

A CIF spokesman said today the federation’s executive body would consider the Labour Court’s recommendation and determine the CIF’s response.

"It would not be appropriate to pre-empt the outcome of this process," he said. "The concern is that the recommendation does not go nearly as far as the CIF had sought given the huge challenges facing all sectors of the construction industry and all options will be on the table for discussion and decision when our members meet’.

Speaking to RTÉ's News at One, CIF director general CIF Tom Parlon said there was "a fallacy out there" that construction workers were badly paid. The entry rate in construction was higher than the Garda rate, the nursing rate and the rate for a State solicitor or even a graduate engineer, Mr Parlon said.

“The rates have grown way ahead of anything else as a result of the explosion in construction activity in the years leading up to the downturn,” he said.

He insisted construction workers were the only sector of workers in the country which had not taken a pay cut.

“It was made clear to the Labour Court that if we didn’t get a realistic wage cut, the CIF would consider withdrawing from the existing registered employment agreement,” Mr Parlon said.

But Ictu's Fergus Whelan said the Labour Court recommendation came as a “kick in the teeth” to workers who had already suffered a raft of cuts in terms bonuses and overtime.

Mr Whelan  claimed the CIF's “real agenda was to get rid the existing employment agreement”. There will be great difficulty in accepting this recommendation on the trade union side, he said.

In its recommendation, the Labour Court said the CIF’s claims came before the court “against the background of what is acknowledged to be the worst downturn in construction activity and employment levels that the industry has experienced in recent times.”

It also noted that the basic rates in construction had increased faster than the corresponding increase in industry generally, due primarily to the applications for “catching up increases”.

“Accordingly the court recommends that the basic rate of craft workers should be reduced by 7.5 per cent with effect from a dater four weeks after the date of acceptance of this recommendation,” it said.