Union `insiders' to sale of Eircell as ballots start

Key union officials at Eircom have been made "insiders" to the proposed sale of Eircell while making plans to organise strikes if they don't like the terms of the deal.

The Eircom Employee Share Ownership Plan Trustee, which owns 15 per cent of the company, has agreed to become an insider to the negotiations under way between Eircom and Vodafone. Under stock exchange regulations, becoming an insider means that the ESOP can be given confidential information about the talks but in return it cannot sell shares or disclose the information given to it in confidence. Two of the members of the trustee board, Mr Con Scanlon and Mr Shay Cody, are respectively the general secretary and national secretary of the Communications Workers' Union (CWU) and IMPACT, the two largest trade unions at Eircell.

Along with the two smaller unions, the Civil and Public Service Union and the Public Services Executive Union, they are conducting "precautionary ballots" of their members this week over strike action if they are not happy with the implications for their members of the deal. The CWU, which is the largest union at Eircom, is expected to know the result of its ballot by Thursday. The other unions will take longer to complete their ballots. Members of all four unions are being asked to give their leaders a mandate to take industrial action - including strike action - to protect pay as well as the terms and conditions of members' employment in light of the developments. "It would be foolish not to have a lawyer in this situation. From the point of view of a trade union, having a mandate in your back pocket is the same thing," said Mr Cody yesterday. Eircom is in talks with Vodafone to dispose of its mobile business for €5.1 billion (€4 billion). A number of issues need to be resolved, including Eircom's ambitions in the mobile business after any demerger, but both sides are optimistic that the problems can be overcome.

A separate €2.25 billion for the fixed line business has been tabled by Mr Denis O'Brien, but serious negotiations are only just getting under way. The deal with Vodafone will require shareholders' approval, which will necessitate the calling of a general meeting of shareholders to vote on the deal. The ESOP Trustee will be balloting its past and present Eircom staff members who are its beneficiaries and will be voting according to the outcome, said Mr Cody. It should be possible for the ESOP to ballot all its members in the three-week notice period that is required for a general meeting.

The board of Eircom meets on Thursday to review progress in both sets of talks.