[BYLINE1]BARRY O'HALLORAN[/BYLINE1]
State-owned energy group, Bord Gáis, has agreed a wage freeze and performance-related pay deal with its 1,100 staff in a bid to save €34 million over the next four years.
The news comes as the group gears up to sell its energy division later this year as part of the Government programme of disposal of State assets.
Bord Gáis confirmed that it recently agreed a new pay deal with its group of unions, made up of Siptu, the Technical, Electricial and Engineering Union and Unite.
Under its terms, staff have agreed to a pay freeze until 2016, and a move away from the traditional incremental pay system to one linked to both performance and the market.
The group said at the weekend that the deal is designed to deliver €34 million in payroll savings over the next four years.
Its last annual report shows that the group’s total pay bill was close to €78 million in 2011, the figures for 2012 are due to be published shortly.
Performance-related pay will apply to all new employees, existing staff who are promoted and any worker who wants to opt into the new system.
The group’s senior managers have already opted for performance-related pay.
[CROSSHEAD]Pension scheme
[/CROSSHEAD]From 2015, the new "market-based" pay system will be benchmarked by agreement between Bord Gáis and the group of unions.
The deal also involves changes to the group’s pension scheme. Existing staff will remain in its defined benefit plan, but new employees will join a defined contribution fund.
Workers voted to accept the deal’s terms recently. The group said it would underpin its financial health in the short and long term.
Commenting on the deal, Siptu sector organiser, Oliver McDonagh, told the union's newspaper, Liberty , that the company had approached workers' representatives seeking payroll savings.
"The new scheme will deliver the savings required," he said. "The union, although dubious about performance-related pay schemes, welcomes the fact that there will be no job losses and no decrease in the earnings of our present members."
[BYLINE1]Permanent jobs
[/BYLINE1]He added that the organisation also welcomed the fact that 58 staff on fixed-term contracts were being made permanent.
The group’s energy division, which supplies gas and electricity to businesses and consumers is up for sale.
The deal is expected to be done by the end of this year. Likely suitors for the group include the world's biggest utility, E.on, British player, Centrica and French giant, EDF.
