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Sunday 21 September 2014

Pay cuts, job losses on cards at ESB as redundancy plan stalls

Published 12/11/2012 | 05:00

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THEY are among the best-paid semi-state workers in the country, with basic salaries of around €70,000.

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But ESB staff now face the prospect of further job losses and pay cuts after the company failed to reach its target of 700 redundancies under its voluntary severance scheme.

The company received around 1,000 applications from workers under the voluntary severance scheme -- however just 600 agreed to leave the company once they got their offer.

Some 150 staff have already left in the last few months, however the speed at which workers exit will escalate in the coming weeks, with another 450 employees due to be gone by December 31.

The company had set a target of shedding 700 jobs as part of a major cost-cutting plan aimed at saving €140m in its payroll bill. It confirmed that it will now be looking at earnings and staff numbers again.

The voluntary severance package on offer to the company's 6,000-strong workforce was not as generous as in the past.

Following the shortfall, the generation side of the business -- which includes power stations and employs some 800 workers -- will now be targeted to deliver €5.3m in payroll savings. Basic salaries at the ESB average around €70,000.

The payroll cost base agreement between management and unions sets out targets for how much must be saved each year from 2012 to 2015.

An independent review by Grant Thornton found that the networks and supply sections had both met their targets for this year, however generation had a shortfall of €5.3m.

A six-week process of negotiation to deliver these savings has now begun.

If this fails to deliver the necessary savings, then the matter will be referred to the ESB Industrial Council -- the ESB's equivalent of the Labour Court -- for a binding decision.

Brendan Ogle, head of the ESB Group of Unions, told the Irish Independent that he did not expect to see compulsory redundancies and said workers could be offered voluntary severance again.

Exits

"Whatever the solution is, it will be in generation. I don't see any scope for compulsory redundancies. It will either be through additional voluntary exits or some form of pay adjustment," he said.

"To get 600 out of a 700 target isn't bad. All the other business units reached their target."

A spokesman for the ESB said: "In the event of a shortfall in the number of agreed exits, the comprehensive payroll cost base agreement includes a mechanism to address any verified shortfall in annual saving targets.

"Under this mechanism, the company and unions will seek to reach agreement on additional payroll savings."

The company has already cut overtime and expenses payments this year, and confirmed it would not be targeting these areas for further cuts.

Irish Independent

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