TALKS BETWEEN the social partners on a new national agreement were still deadlocked early today with a large gap remaining between employers and unions on the issue of pay.
The employer's body Ibec was resisting union pressure for annual pay increases of around 5 per cent to compensate for the rise in inflation.
Ibec circulated a document last night proposing an initial pay freeze for 12 months as part of a 21 month pay deal with a 5 per cent increase after that. It also called for some of the more vulnerable sectors of the economy to be exempt from any pay increases at all.
A senior union negotiator described the talks as the "most difficult ever" because of the speed of the economic downturn. "That's what people are saying and they are not saying it lightly and that's to do with the times we live in," he said.
He added that the unions were putting the issue of collective bargaining aside so they could deal with pay and the Ibec proposals. "We'll be responding to that as it emerges."
A proposal by Government for a flat rate increase which would disproportionally benefit lower paid workers did not appear to find favour either with the Irish Congress of Trade Unions or with Ibec.
The employers argued that flat rate increases would damage businesses already in difficulties and only lead to more unemployment.
The Taoiseach, Brian Cowen, joined the talks late last night in Government Buildings, with the Tánaiste, Mary Coughlan.
The union delegation, led by Ictu president Patricia McKeown, expressed strong opposition to an Ibeca proposal which would widen the scope of the inability to pay clause of the current agreement in any new deal. With the various sides at loggerheads the union leaders warned of an immediate return to collective bargaining at the level of individual employers in the event of a collapse and a return to the industrial unrest of the 1980s.
Sources close to the talks suggested that the unions were, nonetheless, anxious to keep the structure of social partnership in place even if there was no agreement on pay.Government sources were adamant, however, that if a pay deal could not be achieved the groups involved in the partnership process could not continue to have the benefits of involvement in decision making on a wide range of issues.
Under the terms of social partnership as it has evolved since 1987 the various groups involved have a structured access to decision making and their concerns are taken into account in the framing of the budget, particularly with regard to tax and social welfare changes.
Aside from pay the Government presented written compromise proposals on a number of issues which have dogged the talks for months.
The employers were refusing to budge on granting better representation rights for unions, arguing that the Supreme Court had made a clear decision on the issue. The unions were equally firm in insisting that the pay and conditions for temporary agency workers should be the same as those of other workers.