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Careful with that axe, Richard. The intriguing rhetoric of employment ‘reform’. June 9, 2011

Posted by WorldbyStorm in Economy, Irish Politics.
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There’s a bleak entertainment to be had in the ‘debate’ over the ‘reform’ of the JLCs and attendant entities. It’s not so much the specifics which almost incredibly [I say almost, almost…] appear now to be establishing a two tier labour structure at that level with new entrants paid at lesser rates than those already in stream (though this will be no surprise in areas of the public sector), but in the language used itself.

The avoidance of the terms wage cuts, or lowering wages, or reducing pay is evident throughout.

Consider some examples:

MINSTER FOR Enterprise and Jobs Richard Bruton has said his controversial proposals for reform of wage-setting mechanisms would create opportunities for employment in sectors badly hit by the recession.

Speaking yesterday he again signalled his proposed changes could see lower pay rates for new staff. However, he said existing personnel would be protected by their current contracts. “Over time, rates and patterns may change. If we are to create jobs we have to adapt and change patterns.”

By the by, note his no less entertaining though fallacious logic when he appears to implicitly blame JLCs for job losses:

Mr Bruton said in some areas where terms and conditions were covered by joint labour committees, more than 25 per cent of jobs had been wiped out. There were huge opportunities for sectors such as tourism or retail if reforms allowed them to win new business.

That these sectors are particularly hit by a global recession, that in parts they were the product of misguided state support and private sector bubbles, appears to elude him as does the point that the picture is rather more mixed than he would portray it, for more on which see Michael Taft’s analyses].

Anyhow, Bruton continues:

It was important businesses were allowed to be sufficiently flexible to seize opportunities provided by the Government through initiatives such as cutting the VAT rate in the tourism sector, reducing PRSI and scaling back the travel tax.

Uh-huh. But unfortunately there’s no way to entirely sugar the pill…

He argued that if the existing legally binding joint labour committee rates were reformed, existing staff would still have their own contractual relationship with their employers. However, lower rates could be applied for new staff.

In another report there was similar carry-on from him:

“In reality, the proposals are likely to have the greatest impact on new employees, and thereby create an incentive for employers to hire,” he said. “However, it is important to be open and acknowledge that this may, over time, have the effect of causing an adjustment to the terms on which some workers are employed.

Yes, but never upwards. Curious that.

And Stephen Collins, is equally in thrall to this dynamic:

What was striking about the reaction to Richard Bruton’s proposed changes in weekend working rates was not that a number of Labour TDs opposed the plan but that their opposition was clearly sanctioned and even encouraged by the party leadership. This was evidenced by the fact that the Labour press office issued a raft of statements from TDs opposing the Minister’s scheme. Normally government TDs who want to disagree with a minister in public have to issue their own statements and incur the wrath of the party whip for doing so.

And…

There is a case for announcing the changes in rates for the low paid at the same time as the long awaited reforms to reduce costs and eliminate restrictive practices among well paid professionals. However, there is an urgency about getting the decisions made to show everybody that the Government is serious about getting the public finances in order and creating the conditions for new job opportunities.

No mention of the reality that the proposals reduce wages there. And Collins seriously over eggs the pudding with the following:

The Government has to implement reforms in both cases. They are vital pieces of the jigsaw required to bring the economy back to health and they are also conditions of the EU-IMF programme.

The idea that the JLCs are so pernicious is simply not supported by the facts, but on a broader question, are the IMF really troubled by the JLCs? Really? Truly?

By the way, this trope about achieving some sort of balance between costs and restrictive practices among ‘well paid professionals’ is a crock, and linking two very different issues together in this entirely artificial way is purely a cosmetic feint to put a more positive gloss on measures that affect tens of thousands of low paid workers [Michael Taft says more than 200,000 are covered by them]. We saw the same trope trotted out yesterday in the Irish Times.

RADICAL PROPOSALS to cut payouts to lawyers involved in long-running medical negligence cases have been made by Minister for Enterprise and Jobs Richard Bruton.

The plan might also assuage the concerns of Labour backbenchers, some of whom have attacked Mr Bruton in recent weeks for seeking to cut wages for low-paid workers in regulated areas rather than going after the “sheltered sectors”.

Mind you, Collins is back banging the old TINA drum and casting his net wide to do so. So, no change there.

Comments»

1. Michael Taft - June 9, 2011

Unfortunately, it gets worse when one burrows down into the Minister’s proposals. For instance, he proposes that the ‘reformed’ JLCs should only negotiate the ‘basic adult rate’. Many may be unaware that there are numerous sub-categories to the basic rate. For instance, in the retail sector the basic rate is €9.48 per hour (yes, I know – these rates are threatening our very economic survival). However, there are three sub-categories. Under-18 years: €6.64. First year of employment (over-18 years): €7.58. Second year of employment (over-18 years): €8.54. It’s only in the third year that the basic rate becomes obligatory.

All these sub-categories are negotiated at JLC level. However, under the Minister’s proposals none of the sub-rates would be subject to the JLC – which means they are in danger of falling to minimum wage rates. Under-18: €6.06. First year: €6.92. Second year: €7.79.

So even if the basic rate could be maintaned under the Minister’s new JLCs, these sub-categories could experience pay cuts of up to 9 percent. It should also be noted that JLCs categories above the basic rate (experienced workers, higher skilled occupations, etc.) would also be removed from collective bargaining thus putting downward pressure on them. The fact is that a high proportion of workers in the JLC sectors are on rates other than the basic.

Let’s call this for what it is – a massive transfer of income from the lowest paid to employers. It is about dismantling whole institutions of protection (minimal protection) for workers that have existed for decades and which survived the recessions of the1950s, 1970s and 1980s. Clearly, the Minister is not someone to waste a good crisis.

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WorldbyStorm - June 9, 2011

This is astounding stuff really, isn’t it? It’s a godsend for the right and as you say, they’re using it.

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2. make do and mend - June 9, 2011

Aren’t we in the long run talking about a lower pay rate for everyone, especially in the retail, leisure and tourism sectors cited? These jobs, bar maybe management positions, are fairly easy replaced. What’s to stop employers letting seasoned employees go at their higher rates of pay and replacing them with the new lower rate employees? I seem to remember a ferry company doing that a few years ago, and the food industry is a revolving door of employment.

We’re not too far off when the unemployed will be compelled to work for shite wages and increasing, vastly, the number of working poor in this country. They’ll be offered pay day loans at @>2000%+ p.a. as a security safety net.

As M. Taft points out, it’s just a simple transfer of wealth from the workers to the employers.

The unemployed, the working poor and those with Bruton’s sword swinging over their empolyed necks would do well to unionise. The vast majority of labour are now in the same boat. And, by all that’s unholy and fickle in Ireland Inc., it’ll be a slip-shod vessel when the vampire squids are finished their machinations.

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WorldbyStorm - June 9, 2011

+1

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3. CMK - June 9, 2011

The unions need to shut this country down for a couple of days to give the state and employers a taste of things to come if the latter continue with this war. All of the excellent and credible critiques of the various attacks on workers amount to nothing unless there’s serious wide scale industrial action to back it up. The employers need to be reminded, forcefully, that they can’t function without employees and they can’t function without reasonably contented and well paid workers. The last thing we need is David Begg intoning ‘there is a better, fairer way, blah, blah, blah….’.

In one sense the attacks on JLCs should be welcomed on the not particularly sound grounds of ‘the worse, the better’, as it might spur workers to organise and resist to the extent that IBEC, ISME and the rest of them end up hammering at the doors of the Dept of Enterprise demanding that JLCs and REOs be re-instated.

Added to that it appears clear that the European Union has now institutionalised as a clear policy aim and practice an unrelenting attack on wages and pensions – all in the name of competitiveness. See pages 16-18 of the new Euro Plus Pact document:

Click to access 120296.pdf

Fair play to Hugh Green who has covered this latter issue in recent days.

http://hughgreen.wordpress.com/

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4. Chet Carter - June 9, 2011

‘The resistance movements across Europe must co-ordinate themselves to build an alternative model of society based on left principles. And to do all this we must concentrate in reversing the present relation of forces, dedicating our energies to finding points in common among the “multiple lefts” and abandoning the always horrible sensation that we like having enemies more than having friends’.

Words of wisdom. The multiple lefts in Ireland should unite around an agreed candidate for the Presidential election who will campaign to repudiate the debt.

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5. Joe - June 9, 2011

http://www.mandate.ie/Constituency/Constituency.aspx

Don’t know if the above link will work. But anyway Mandate has a good lobbying campaign going on this. Go onto their home page and click on where it says click here to defend your rights or some such. Then send the email to your local TDs.
I must say the 4 Dublin Central TDs have slick operations – I got detailed email responses from them all pretty much immediately. My response to their responses encouraged them to take from the rich and redistribute. My SF TD gave me concrete examples of their proposals in this regard. Cue grudging admiration… what’s wrong with me?!!

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6. Captain Rock - June 9, 2011

The link to Mandate works.
I don’t agree with the comments of CMK: these attacks are not encouraging resistance, they are encouraging despair. I’m afraid the ICTU are hoping to sit out the recession and somehow come out the other end intact.

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CMK - June 9, 2011

I actually agree with you, the trade union leadership so obviously want this to blow over and everything to go back to ‘normal’ (i.e. Social Partnership) as soon as possible. My point was that there is a floor in any reasonably advanced society below which living standards can fall without undermining social order; we’re approaching that point, in my view, and the attacks on JLCs and REOs are hastening things.

Despair far outweighs resistance, for the time being. But despair won’t stop the attacks but will actually sustain them. One thing is in abundance is time as conditions don’t look like they’ll improve any time soon and that’s before a default etc.

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7. irishelectionliterature - June 14, 2011

Johnny Fallon had a good article on the JLCs
http://johnnyfallon.blogs.ie/2011/05/30/jlc-reform-be-wary-of-promises/

One part being particularly relevant with regard to job creation was about the previous reduction in the minimum wage.

From a political point of view let me go back to one more example of this. The Minimum wage. Throughout last year there was a chorus of calls for a reduction in the minimum wage. We were told that it was blocking jobs and employment opportunities. Indeed I remember TV reports where employers suggested they had work waiting to be done but couldn’t afford it due to the minimum wage. So last December the Finance Minister took them at their word and reduced the minimum wage. In the general election that followed Fianna Fail took a major hit on this issue as other parties promised to restore the wage. Now wouldn’t it have been perfect for FF if all those who had suggested that they had work to give but the barrier was the minimum wage had come out and offered that work as soon as the wage was reduced? Why didn’t FF simply demonstrate the practical and immediate effects that the minimum wage reduction had? Why didn’t they show even the anecdotal evidence of a stirring on employment? Why? Because it wasn’t there….

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8. tomasoflatharta - June 17, 2011

The United Left Alliance will be putting a motion to the Dáil on Wednesday 22nd June. Come to the protest at the Dáil during the debate and vote at 6:30pm

http://tomasoflatharta.com/2011/06/17/keep-sunday-pay-and-overtime-rates-support-dail-motion-wednesday-june-22-6-30pm/#more-505

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