Staff at bailed-out banks want pay rises
Published 09/06/2014 | 02:30
PAY talks are set to begin at the country's two largest banks after a five-year wage freeze for thousands of workers.
The Irish Bank Officials Association which represents 6,000 staff at Bank of Ireland, said pay increases were back on the agenda after the bank's return to profitability. It is carrying out a review of pay at the bank, though no pay claim has yet been lodged.
The IBOA is expected to begin similar negotiations at AIB, where it represents 6,500 staff, and which is also back in profit.
The union is the latest to seek wage improvements following a series of pay increases in other sectors, as the economy shows signs of recovery.
Employers including Tesco, Boots, Brown Thomas, Debenhams, Dunnes Stores, Marks & Spencer, Glanbia, and Medtronic, have already agreed to wage rises in the region of 2pc to 3pc.
In March, bailed-out Bank of Ireland became the first major bank to return to profit since the financial crash, following pre-tax losses of €569m last year.
It has now repaid to the Exchequer more than the amount of state funding provided to the bank as part of the bailout.
The last pay increase at Bank of Ireland was at the end of 2008 and the last increase at AIB was in 2009.
Although bank staff did not suffer pay cuts during the banking crisis, their union says remuneration fell as bonus and productivity payments were axed, increments frozen, and pensions cut.
IBOA general secretary Larry Broderick said bank officials "are not fat cats enjoying the rich cream".
He said the vast majority earn less than €45,000 a year, while senior executives who caused the crisis "floated away to retirement on their golden parachutes of pensions and other rewards".
The IBOA said it had engaged in preliminary discussions with Bank of Ireland, but expected the wide-ranging review to take some time.
"The rapid transformation under way in Irish banking since 2008 has resulted in significant changes in the nature of the work performed by many bank workers, who have been required to take on different roles and additional responsibilities," said IBOA spokesman Seamus Sheils.
"The talks which have just begun in Bank of Ireland will, therefore, consider the need for a new approach to remuneration – rather than simply increasing existing rates by a particular amount."
He added that pay increases are coming back on to the agenda as the financial institutions return to profitability.
"In most cases, staff have had a freeze in their pay for a number of years," he said. "Bearing in mind the return to profitability, the staff who have contributed to that recovery should be rewarded for their role and contribution in bringing that situation about."
He said a formal pay claim has not been lodged at Bank of Ireland, but a general discussion about remuneration has begun.
Mr Sheils said a "comprehensive" review of salaries was agreed after the union signalled it would seek improvements in rewards for members.
"The union has engaged in preliminary discussions with management on this issue, but this wide-ranging review is expected to continue for some time," he said.
The editorial of the latest edition of the union magazine 'Spectrum' outlines how pay is back on the agenda.
"The issue of pay and reward is once again a key priority on the union's bargaining agenda with most, if not all, of the employments where the staff are represented by IBOA, after a number of years of pay stagnation in light of the economic downturn," it says.
"With many financial institutions expecting either to continue in profit or to return to profitability by the end of 2014, our claim for appropriate recognition of our members' contribution to this recovery has renewed substance."
It noted that the leader of the trade union movement, David Begg, said increases should be pursued where they can be afforded.
The last pay increase at the financial institutions was in 2009.
However, a lump sum productivity payment, worth 4pc of pay, was paid at AIB last year after staff agreed to pension changes and an increase in hours.