German public sector pay deal offers potential model for Ireland, says union leader

A two-year German public sector wage deal that involves €3,000 in tax-free inflation compensation, a €200 flat rate monthly pay increase plus 5.5 per cent could provide a model to progress talks between the Government and Irish unions in the coming months, the Irish Congress of Trade Unions president has said.

Fórsa’s Kevin Callinan, who will lead the union side in negotiations as chair of Ictu’s Public Services Committee, points to the deal agreed recently between German public authorities and Verdi, a union representing 2.5 million workers as having an “interesting” combination of elements “worthy of consideration here”.

The German union had sought pay increases of 10.5 per cent at the outset of a process that included a number of high-profile strikes, including at some that caused disruption at German airports. In the end, they agreed a deal, recently endorsed by the membership, that involves the payment of €3,000 in “inflation compensation” with almost half of it in June and the rest to come in monthly instalments until next February, after which there will be a flat rate pay increase of €200 per month plus the 5.5 per cent.

The one-off nature of the “compensation” element is intended to counter the argument that the payments would be inflationary while the €200 element is intended to particularly help lower-paid workers. The minimum increase will, it is envisaged, be €340 a month compared to the €500 initially sought. Inflation in Germany has been running at over 9 per cent.

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“It’s interesting but not without its downside on the worker side because obviously the portion of it regarded as ‘compensation’ is in a one off payment,” says Mr Callinan.

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“But what I’m saying is, if you could get the combination right, you shouldn’t rule out that being some element of it.”

Mr Callinan has referenced elements of the deal at a number of recent public events. Preliminary talks about a successor agreement to the current national public sector pay deal, which runs out at the end of the year, have been going on for some time with substantive negotiations expected after the summer. The union’s position is likely to be the subject of discussion at this week’s Ictu congress in Kilkenny.

Asked, meanwhile, about reports in The Irish Times this week that a body is to be established to assess the particular need for pay increases for higher paid civil and public servants in order to address recruitment and retention issues, Mr Callinan said that these are issues at all levels and that if high awards are made, lower paid workers would feel entitled to the same.

“If what’s being said here is there should be some kind of process established to deal with the pay of senior people, at one level, that’s just a return to the arrangements that were in place when we had the review body on higher remuneration until 2007.

“But, how are ordinary workers going to look on this when they already see super high wages to a lot of people are at the top end of, not just the public service but business as well.

“And at a time when people are struggling with the cost-of-living crisis, I just don’t see how that makes any sense at all. Certainly, if the message from Government is going to be that ‘we kind of think that there should be more money for top paid people’ then people down at the bottom will, rightly, feel that they should get a similar share the action.”