It seems that IBEC and the Labour Relations Commission (LRC) are both calling for some kind of new centralised national wage/income agreement to control pay, as some would put it, in the ‘national interest’. The two leading figures from these organisations (Danny McCoy and Kieran Mulvey respectively) have all in recent weeks made noises about the possibility of a national agreement between union, employers and the Government on pay and income with the Sunday Business Post going as far as suggesting informal discussions have already commenced on this.
Is this signs of a tip in class power or is this a cynical move to manage and control growing worker militancy, when it comes to wage claims, in the ‘national interest’ – defined broadly as not allowing wage increases outpace inflation? When the claim for wages is accompanied with a suggestion to put in place a dispute resolution mechanism it would worryingly suggest that claims over and above the decided % will be met with opposition from State institutions and this new mechanism.
We have to ask ourselves in whose interest would this kind of agreement be and why are big business calling for a national agreement now when they wanted nothing to do with one previously? What is the political economy of such a move?
Business and Government want to suppress pay. Suppressed pay boosts profits. Profits are often made directly at the expense of workers’ wages. Profits from outsourced services largely come from pay cuts or pay stagnation. Wage stagnation supports the profits of exporting companies. This covers both the interests’ of big business multi nationals operating a variety of outsourcing contracts both private and public sector and also big Irish business engaged in exporting. Wage stagnation is also required by EU economic regulations and its public finance straight jacket. Wage claims are class struggle at a very basic and local level.
It is clear business and the Government are worried about growing union and worker militancy on the wage front. They may also be concerned that recent union wins on pay, particularly for the low paid in the retail sector by Mandate trade union, may have an inspiring effect on workers and lead to increased demands and mobilising efforts. SIPTU, and Jack O’Connor, have made it clear in recent times that they are pushing for pay increases in the private sector and this is welcome news for these workers. Other union are also making positive noise in this direction.
IBEC, however, have also stated that they expect both income tax and social welfare to be looked at in conjunction with any agreement and the said dispute resolution mechanism. Meaning they will seek income tax reductions for the wealthy and also a reduction in social welfare for the unemployed.
What does the union movement need to be conscious of? The class interests of big business in coming to an inflation based flat rate national agreement that is actually harmful to wage claims arising from organised militant workers. Putting claims over and above any set national rate into a negotiating mechanism removed from direct negotiations. Removing wage struggles from the workplace damages local union organisation and worker militancy and also disincentives union organising. It breeds an attitude of ‘we all get this anyway’ and ‘isn’t this a Government pay increase’ both damaging to union strength and leverage. But most importantly it is likely to make it even more difficult for the lower paid to win pay increases above inflation, increase their standard of living and reduce inequality.
