Attack appears to be the best form of defence where the Communications Workers' Union (CWU) is concerned. Far from being fazed by KPN's decision to sell its shares in Eircom, CWU general secretary Con Scanlon says that his members would be keen to take up some of the slack.

He also says his members can raise the money to buy more shares. Such a move would require a change in the deed of trust for the Employee Share Option (ESOP) scheme under which CWU members currently hold 14.9 per cent of Eircom. However, Mr Scanlon believes Eircom will be amenable to such a change.

"We want the ability to buy shares and protect our shareholders," he adds. "We could raise the funds to buy possibly 5 per cent of the company."

The shares could be purchased either through a bid on the market or by buying through a broker at the appropriate time.

The CWU could easily raise the funding required. Its own shareholding is now worth £1 billion (€1.3 billion) but it only has borrowings of £90 million. At the time of the purchase Telecom Eireann, as it then was, was valued at £1.9 billion and the ESOP cost CWU members £285 million.

The Government gave employees in Telecom Eireann 5 per cent of the company in return for agreeing to radical changes in work practices through the Transformation Plan. The Minister for Public Enterprise, Ms O'Rourke, is expected to sanction the handover of the last tranche of these shares before the new year. Mr Scanlon does not anticipate any problems with the handover.

"I don't think our people could have done more. He candidly admits that without Ms O'Rourke's appointment it was unlikely an ESOP deal could have been brokered two years ago. Like other trade union leaders he has little good to say about the Department of Public Enterprise itself, or her predecessor Mr Alan Dukes who resisted any union shareholding above 5 per cent.

Given the level of change demanded, Mr Scanlon says 5 per cent would not have been enough. "We always argued that 14.9 per cent was a great incentive, but it has had an even bigger effect than I ever imagined.

"Not alone are members concerned now to protect their pay and conditions, but their shareholding as well. We now have to operate on two levels as a union and our people realise that." One example is outsourcing. In the past the CWU vigorously opposed contracting out work. It was seen as a threat to jobs. "If it couldn't be done by union members it tended not to be done at all. Now people recognise there is room to outsource if that is the best way of doing something.

"We now have a partnership approach within the company that operates at a strategic level and also business unit level and ground level. That allows for a fast response to competitive threats on the ground.

"In the past, if you got change in the system you had to deal with staff issues as well. Now, if you need change you do it and the people issues won't always be dealt with in tandem." He says, "I could present proposals now to members that would not have been contemplated a year ago."

That shows in the ability of Eircom to survive in increasingly competitive markets. Now valued at £7 billion, it also means that employees will have to pay substantially more for another 5 per cent of the company than they did for the original 14.9 per cent.

Mr Scanlon believes Dutch company KPN's decision to pull out of Eircom was based on a simple calculation that its shareholding would not increase at the same rate over the next three years as it had in the past three. "They may feel if they reinvest the money in central or eastern Europe they will get a better rate of return."

He also believes that companies are more inclined to cash in their shares when they don't have direct management control. This implies Eircom may have difficulty finding another strategic partner and the CWU's interest in acquiring a bigger shareholding is aimed at giving it greater leverage in any future negotiations.

With Telia withdrawing from Eircom because of its amalgamation with Telenor to form Newtel and Eircom's majority shareholding scattered among institutional investors and about 350,000 small shareholders the future looks uncertain, to say the least. But like Eircom's chief executive Mr Alfie Kane, Mr Scanlon believes it has got the basics right.

He also says it is time the telecoms regulator, Ms Etain Doyle, "eased off" on Eircom. Mr Scanlon describes her approach to the company as "grossly unfair" and "Cromwellian". "If the 500,000 investors in the community knew what handicaps competition imposes on Eircom there would be an outcry."

For example, he says that Eircom must publish its prices while its main competitor in the mobile phones market, Digifone, does not. Another example is Ms Doyle's insistence on unbundling local loops to allow in other companies.

"I believe this will be anti-competition in the long run," he says, "because it will provide no incentives for companies to build or maintain their own networks. In the US there is very little unbundling because they recognise it's in nobody's interests."

Other companies were also allowed "to play ducks and drakes with lines", he claims. "If Eircom doesn't provide a line it can be fined up to £70,000." He says the system is open to abuse with rivals demanding a service and then not following up.

Returning to Ms Doyle's role, he says "it is time she took her foot off Eircom's neck. Her approach is very heavy handed and no one is being penalised except Eircom. It might have been necessary at the start, but not now."

He believes the Orange judgement was "a huge indictment" on the regulator and her office. After a lengthy hearing, the High Court ruled that there had been "objective bias" shown towards Orange - which had tendered for the third mobile phone licence - and referred the matter back to Ms Doyle for consideration. Mr Scanlon says Ms Doyle has no credibility left, following the outcome of the licence competition. "What she is doing now is damaging Eircom and its chances of finding a suitable partner," he claims.

Turning to the projected ESOP at An Post, he estimates that a 14.9 per cent shareholding would only be worth between £2,000 and £3,000 per employee, compared with £90,000 to £100,000 in Eircom.

"In my view there is a psychological value when people have shares in a company, but this is a greaser of the wheels in terms of change, no more than that."

As in CIE, An Post relies heavily on overtime to maximise output from relatively low-paid staff. Mr Scanlon sees a need to introduce comprehensive pay restructuring where the union could trade off greater flexibility in return for decent pay rates. He hopes to see a deal concluded by the end of next month.

Mr Scanlon is highly critical of current plans to tackle the problems of declining business at rural post offices by simply putting computers into them. It will not halt the decline in business, 90 per cent of which comes from statutory bodies such as the Department of Social Welfare, RTE, the National Treasury Management Agency and from Eircom, he says.

The 1,300 smallest sub-post offices only generate 14 per cent of the business and these were never intended to operate commercially, even when the majority of the population lived in rural areas. "If the Government and political parties want to preserve that structure they are going to have to decide the State will pay for it."

Given the level of change in the communications sector and the number of jobs shed, the CWU membership has remained at 19,000. This is partly because job losses in Eircom have been offset by extra employment in An Post, and also because of aggressive recruitment campaigns.

The CWU organiser is Mr Chris Hudson, who was awarded an MBE in last year's honours list for his work in the Northern Ireland peace process. The union membership has up to 90 per cent of new staff in Eircell and several hundred members in the private sector.

Its biggest successes have been in the couriers' sector. It has won recognition from a number of companies, including UPS, Parceline and Interlink. It still has not won recognition within Esat, but has a significant membership in its mobile phone subsidiary Digifone and is watching with interest the outcome of the current battle for control with Newtel, which recognises trade unions.

The union has had setbacks, such as the sacking of two new members by TNT in Cork. However this ultimately cost the company £20,000 in compensation to the sacked men and £25,000 in legal costs because the Employment Appeals Tribunal accepted the CWU argument that its members had been victimised.

This week the union launched a new recruitment drive with a target of 4,000 extra members over the next three years.

On the current crisis in the negotiations on a successor to Partnership 2000, Mr Scanlon says that the CWU would prefer to see a new agreement reached. While the CWU would be better placed to protect members in a free for all than some unions on the pay front, he adds that: "This isn't just about pay. There are a lot of quality of life issues which are important to our members, and others as well."