Construction unions likely to press for 4%+ pay rise

Employers and unions seem set to clash over plans for a revision of pay and conditions for more than 50,000 workers in the construction sector.

Trade unions are expected to look for increases of more than 4 per cent – potentially about 4.2 per cent – annually as part of a new three-year deal. However, it is understood that construction employers are envisaging increases of about 1.6 per cent, starting from next April.

The Labour Court has invited submissions by the end of July for a review of pay and conditions on foot of an application by five trade unions for a new sectoral employment order (SEO) for the general construction sector.

Such an examination of pay and conditions could lead to a recommendation going to the Minister for Enterprise, Trade and Employment, Leo Varadkar, regarding a new SEO, which would set out minimum levels to apply in the future.

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In a landmark case last month, the Supreme Court upheld the constitutionality of provisions in the Industrial Relations Amendment Act 2015 for the making of SEOs.

Representatives of trade unions in the construction sector are to meet this week to consider their submission to the Labour Court as part of the new process. Sources said the unions are likely to press for increases of just more than 4 per cent annually as part of a new three-year SEO.

It is expected that the unions will want any new increases to come into effect from October.

Inflation rate

Employers in the construction sector are understood to believe that, while a pay increase is more than likely inevitable as part of the new process, it should be pitched at around the rate of inflation.

Construction employers are concerned at the impact of Covid-19 on the sector in terms of delays and uncertainty surrounding projects. Employers also point to inflationary pressures, particularly in relation to cost of materials, which are having to be absorbed.

Construction employers are expected to argue that there should be no increases in pay this year and that a rise of 1.6 per cent – in line with the current rate of inflation – should come into effect in April 2022 . A similar increase would apply in April 2023.