Tuesday 12 December 2017

Disputes and pay deals: it's simply a case of 'déjà vu'

Agreements, misunderstandings, protests and strikes. Gerry McMahon charts 45 years of industrial relations

In Larkin's footsteps: A PAYE protest march along O’Connell Street in the early 1980s. Photo: Independent Newspapers Ireland/NLI
In Larkin's footsteps: A PAYE protest march along O’Connell Street in the early 1980s. Photo: Independent Newspapers Ireland/NLI

For seasoned observers of the Irish ­industrial ­relations system, the current impasse ­between gardaí, teachers and the ­Government is a case of 'déjà vu'. We've seen it all before and - if spared - we'll see it all again.


The first government intervention in recent history in national pay determination came to pass in 1970. This was in response to real fears about the damage being wrought on the economy by strikes and sizeable pay awards. As a result, the Fianna Fáil government threatened to neutralise unions and employer bodies, by setting the level of pay rise via statute law. Frightened at the prospect of having their 'raison d'être' removed, unions and employers hammered out the first in a series of seven national wage agreements (NWAs), running from 1971-79.

Realising that their members' standard of living was determined by more than just pay rises -and in partial response to the massive PAYE protests in 1979 - unions negotiated more broadly based packages in 1979 and 1980, labelled 'National Understandings'. However, like their NWA predecessors, these 'understandings' were quickly re-named 'misunderstandings', as unions used the pay provisions as a springboard in pursuit of further pay rises, rather than accepting them as the pay ceilings that they were intended to be.


Eventually, employers' dissatisfaction with the national pay agreement and understanding-type arrangement heralded a new era in pay determination. This involved a discrete pay deal for the public sector, while private sector employers did their own thing at local level.

Faced with economic disaster, the new Fine Gael-Labour government took a tough line on 'special claims' that were lodged outside of the prevailing public-sector pay agreement. This even included a (failed) attempt to squash an arbitration award to teachers in 1986. Notably, this bitter dispute - which saw all three teacher unions take to the streets and fill Croke Park in a national day of protest - was subsequently identified by some cabinet members as the main reason that the government was not returned to power in 1987.


Still faced with severe economic problems, the new Fianna Fáil government - with Charles Haughey and Bertie Ahern to the fore - called in the trade unions and employer organisations to hammer out the first in a series of seven 'Social Partnership' agreements.

The first such agreement - covering a host of economic and social issues - entailed a trade-off between modest pay rises and job-creation commitments. This deal was appropriately named the 'Programme for National Recovery'. It was widely adjudged to be a success, as unions adhered to its pay provisions and the economic recovery got under way. Indeed, so successful was the arrangement that six successive similar (pay, economic and social) type agreements came to pass up to 2009:

* Programme for Economic and Social Progress (1991-94)

* Programme for Competitiveness and Work (1994-96)

* Partnership 2000 (1997-2000)

* Programme for Prosperity and Fairness (2000-03)

* Sustaining Progress (2003-05)

* Towards 2016 (2006-16)

However, the first cracks in this 20-year social partnership practice started to appear in 1997. With the economy showing signs of improvement, nurses threatening strike action secured a settlement (in an election year) that was over and above the terms of the prevailing pay agreement. Thereafter, a spiral of repercussive pay claims followed - including the infamous 1998 garda 'blue flu' - as the tradition of converting pay ceilings to pay springboards came back into vogue.

With the Celtic Tiger in full swing, the economy seemed capable of sustaining this pay-rise pattern. It even extended to most public-sector workers winning an increase of almost 9pc under the first Benchmarking exercise (in 2002 - yet another election year). Benchmarking was the official response to public-sector workers' complaints that they were being bypassed by private-sector workers enjoying the benefits of the economic boom.

Ultimately, when the cold winds of the economic recession kicked in, employers cried halt to the social-partnership experiment and opted to go their own way on the pay front in 2009.


With private-sector employers now doing their own thing, the Government was forced to take the bull by the horns and from 2009 onwards, a series of measures were devised to put the country's finances in order. These included the introduction of the Universal Social Charge, public-sector pension levies, pay cuts, reduced terms and conditions of employment etc. The cost-cutting initiatives were unprecedented in the history of the State and were facilitated in the form of public-sector deals via the Croke Park Agreement (2010), the Haddington Road Agreement (2013) and the controversial Lansdowne Road Agreement (2015-18).

Gardaí and Teachers

The current garda and teachers' pay disputes are unlikely to produce a clear winner. But they have the potential to produce lots of losers. With mounting pressure to accelerate pay restoration, the Government finds itself in an unenviable 'damned if you do, damned if you don't' position. The dreaded knock-on effect of concessions is at the heart of their reluctance to put more money on the table.

With the public-sector wage bill already at €15bn, pay restoration across the board could cost up to another €2bn - with significant implications for the budget and EU regulations. Having mainstream party political support, alongside the 20 other trade unions that have accepted the deal, strengthens the Government's case.

Assurances about the potential and pace of the new Public Services Pay Commission are likely to comprise part of the solution to the current confrontations. However, false promises that peddle a 'live horse and you'll get grass' line may not sway all gardaí and teachers - especially in the face of good Exchequer returns and economic growth figures. Furthermore, the fact that the Commission is only 'advisory in nature' and that its reference terms ensure it's not going to be a re-run of the 2002 benchmarking bonanza, will make it difficult to sell without an 'up-front' type payout.

Gardaí and teachers are also conscious that the terms enabling breakthroughs in the recent LUAS and Dublin Bus disputes went well beyond what would be required to keep them at work.

However, most interested parties are hoping that 11th-hour proposals will see the scheduled actions deferred in favour of consultation with the membership. There's no doubt but that in time, the key long-standing characteristics of the Irish industrial relations system - creativity, conciliation and compromise - will resolve the current disputes. But time - like resources - is in short supply right now.

Dr Gerard McMahon is a lecturer/consultant in HRM/industrial relations at the DIT

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