The future of social partnership remains in doubt after employers and unions failed to break the deadlock last night in talks on a new national pay deal.
Differences between the sides over several issues, including the duration of any new deal, were holding up progress when the parties decided to adjourn the talks at 10.30pm. Negotiations are expected to resume at Government Buildings today.
It had been hoped that substantial progress towards a deal would be made when the sides returned to the negotiating table yesterday afternoon after a five-day break.
It is understood the employers' body Ibec was continuing to insist that any agreement should run for close to three years.
Union leaders have been seeking a shorter deal because of uncertainty over inflation, and as talks resumed yesterday afternoon a two-year agreement had seemed the most likely outcome.
The failure to bridge the gap on this issue alone was indicative of the difficulties the parties face in securing a pay deal.
An agreement on pay would form part of an overall 10-year social partnership programme which would succeed Sustaining Progress, with the pay element to be negotiated at intervals.
By the time talks adjourned last night, however, there had been no movement on critical issues, including pensions, employment standards and the unions' demand for a special flat rate increase for the low paid.
A package of measures designed to underpin employment standards has been largely agreed, including a trebling of the number of labour inspectors to 90. Legal and technical issues, however, have hampered efforts to complete agreement in this area.
On pensions, the unions are seeking measures that would force employers planning to downgrade occupational schemes to have their plans subjected to an independent assessment to test if their plans are justified. It is understood the Bank of Ireland's decision last week to scrap its defined benefit pension scheme for new staff members has forced this demand to near the top of the unions' agenda.
Agreement on basic pay increases was also proving elusive.
The Irish Congress of Trade Unions was understood to be seeking increases of at last 5 per cent a year for the 600,000 members of its constituent unions.
Ibec has insisted from the outset that any increase would have to be restricted to "low single figures", taken to mean of the order of 3 per cent.
Taoiseach Bertie Ahern urged the parties last Friday to use some "imaginative thinking" in their efforts to bridge the gap.
This was interpreted by the parties as a request to look at how the phasing and timing of pay rises could be arranged to meet both sides' objectives.
It is understood one scenario being considered was that a pay deal be stretched from the two-year duration sought by unions to one of 27 months. This might enable unions to secure the overall 10 per cent pay increase required, but over a timeframe that would mean employers did not have to pay a full 5 per cent per year.
There was no indication last night, however, that even this compromise formula would be acceptable to either Ibec or the Department of Finance given its implications for the public service pay bill.
On the other hand, unions were unlikely to accept a 30-month deal unless something more than a 10 per cent increase could be secured.