Eircom workers face a 10 per cent pay cut under a cost-cutting plan which will see the company save €92 million over three years.
The company, which is majority-owned by Singapore Technologies Telemedia, is overhauling the former State-run group whose fixed-line business is in long-term decline.
It warned this week that there was a significant risk it would breach its financial covenants within three to six months.
The main union representing workers at Irish telecoms group Eircom said this afternoon it reluctantly recommended its members back the cost-cutting plan in return for a deal to save the debt-riddled firm.
The plan will now be put to a ballot of union members and the company awaits the outcome of that process.
Commenting on the developments, Eircom chief executive Paul Donovan said: “This plan is a vital next step in the company’s transformation journey to secure the future of the organisation.”
If workers agree to the plan, Eircom shareholders STT and the Employee Share Ownership Trust have agreed to invest in the firm, the Communications Workers' Union said in a statement.
Eircom has said it plans to start talks with its lenders by April after the restructuring vote. STT could not immediately be reached for comment this evening.
The union, which represents the majority of Eircom workers, said it would begin consultations with branches next week, but did not say when a vote would be held on the package.
The three-year deal will lead to a pay cut of 10 percent for workers, who will work nine days per fortnight.
It offers assurances that the workers will be returned to full-time after a wider restructuring. Eircom's net debt was €3.75 billion