Reality check needed by the JLC
Print16 September 2010
After conducting a survey this month with a number of retailers and suppliers to gauge the general mood of the industry, it was plain to see that there are many issues that need to be dealt with but one of the most pertinent problems and one that keeps rearing its ugly head is the issue of the Joint Labour Committee pay rates. As well as our survey respondents, the Convenience Stores and Newsagents Association (CSNA) and the National Federation of Retail Newsagents Ireland (NFRN) have been very clear that these rate increases need to be abolished rather than delayed. Despite the fact that last month the JLC agreed to postpone the next increase until January 2011, this is not even coming close to understanding the pressure employers are under due to staff costs. Ireland has the second highest minimum wage in Europe at present, a pretty ridiculous fact considering the amount of people unemployed and the sheer size of our mounting debt.
The National Minimum Wage (NMW) Act came into effect in 2000. The hourly rate was then set at IR£4.40 (€5.59) and since then it has increased six times. The current minimum wage rate for an adult employee since 1 July 2007 has been €8.65 an hour which means that Ireland has the second highest national minimum wage in the EU, after Luxembourg.
A Joint Labour Committee pay increase agreed in 2007 was due to be paid originally in October 2009 but was frozen for 12 months following an appeal. At the end of July this year it was agreed that the wage freeze would continue up to January 2011 and that the increase would be split between 1 January, 2011 (1.25%) and 1 June, 2011 (1.25%) which only really serves to delay the pain that is to come. The CSNA has said that it plans to meet with other employer representatives from the JLC’s (Hotel and Catering, Agriculture, Security, Hairdressing) to pursue a joint approach on finding a complete alternative to the present system that is “outdated and inflexible”.
NFRN has also been shouting about the difficult trading environment retailers are operating in and said that employers should be aided in keeping employees on the payroll not put into a position where further redundancies are inevitable. The recession has already caused 24,700 job losses in the retail sector, almost 25% of the current retail grocery workforce.
Yet the retail industry is not the only one to be adversely affected by wage restraints. The restaurant industry has been lobbying this issue for the past year too. The Restaurants Association of Ireland brought out a survey earlier in the year showing that its members were actually in favour of a reduction of the minimum wage from €8.65 per hour to €7.65, and are seeking to abolish JLC rates in order to save jobs. Other industry sectors are also advocating a change to the minimum wage because at present the rates are simply unsustainable for many employers. The question is how can this Government not understand that creating as much employment as possible should be the first step to economic recovery?
Fionnuala Carolan
Editor
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