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Thread: Electrician's dispute - can it be scuppered by the NECI?

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    Politics.ie Member DaveM's Avatar
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    Default Electrician's dispute - can it be scuppered by the NECI?

    Electricians suspend strike after pay rise proposed - The Irish Times - Mon, Jul 13, 2009

    The National Electrical Contractors of Ireland (NECI), a breakaway employers’ group which is not part of the negotiating process, said it was “in complete dismay of the Labour Court’s recommendations”.
    Chief executive Denis Judge, said that “in a judgment on February 29th, 2009, after the longest hearing ever held in the LC, the Labour Court rejected a proposed increase of €1.05.” The economy had substantially worsened since then, he said but now “the Labour Court has recommended a 4.9% increase”.
    He added that if the decision was ratified “it is nothing other than a black day for the Irish industry”, where the black market would thrive and dole queues will increase. The association’s members would be balloted on the issue.
    Mr Devoy said that it was irrelevant what Mr Judge’s “outfit” decided because they too would have to adhere to the agreement.
    Earlier this year the NECI began a legal action against the electricians’ payment process because it was not party to the negotiations.
    When reading the front page article in the Irish Times this morning I was left wondering whether this settlement will be the end of the dispute even if the ECA and the AECI sign up to it. The NECI were excluded from negotiations again and in doing so is this simply setting the scene for a high court challenge to the REA itself? That's something that would have implications reaching far wider than just the electricians themselves.

    I got the impression that the fundamental issue for the unions in the dispute was the principle of the REA continuing to be the basis by which pay and conditions were set in the sector and that pay was a secondary (although not insignificant by any stretch of the imagination) consideration. The pay settlement on the table falls quite a way short of the TEEU's initial demands so does that support the idea that the protection of the REA the ultimate issue?

    So why exclude the NECI? Was there no chance of their signing up to any kind of agreement if they were allowed to the table? Was it the ECA and AECI that forced their exclusion in order to protect their own patch? Were the TEEU willing to talk to them? The quotes from Eamonn Devoy seem to suggest that the TEEU are of the opinion that the NECI will be bound by the agreement or is he just maintaining a positon knowing that the field is merely being narrowed so that there is only one employers body left outside the tent?

    I just get the impression that, even if the ECA and AECI sign up to the deal which is far from certain, this one may rumble on for quite a while yet.

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    Obviously the unions want REAs to continue as they make all employers in the sector pay the same as the top tier. I don't think all employers want REAs to die as might suit top tier as ensures small players have to match their rates...

    If only they had REAs in IT they could go to Micosoft, Google & others so that all employers would have to match their pay.

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    Politics.ie Member Munion's Avatar
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    The unions are killing the concept of direct employment as we know it.

    All small and medium contractors in the construction industry will soon only employ lads on a C35 (ie. subcontractors) on a fixed price basis.
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    Politics.ie Member DaveM's Avatar
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    I suppose the fundamental question is, were the NECI to take a case to the high court, on what grounds would it be decided? I don't think there is any precedent for a case like this. What is the tipping point? What proportion of employers, represented by a body excluded from the process by which terms, conditions and pay were set, can then be bound by whatever was agreed?

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    Politics.ie Member DaveM's Avatar
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    Quote Originally Posted by Munion View Post
    The unions are killing the concept of direct employment as we know it.

    All small and medium contractors in the construction industry will soon only employ lads on a C35 (ie. subcontractors) on a fixed price basis.
    We're well down that road already. And when the sector starts to pick up and lads are being taken back on again this process will only accelerate.

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    Quote Originally Posted by DaveM View Post
    We're well down that road already. And when the sector starts to pick up and lads are being taken back on again this process will only accelerate.

    The deal should be scuppered by the Competition Authority. Why should electrical contractors who lives, and works in Dublin on high tech projects be paid the same as a Derry based one working in a factory in Donegal?
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    Politics.ie Member Munion's Avatar
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    Quote Originally Posted by DaveM View Post
    We're well down that road already. And when the sector starts to pick up and lads are being taken back on again this process will only accelerate.
    Two years ago we decided to change the business model of our small contracting firm from direct employment to nearly exclusively subcontractors.

    We've been taking the financial hit of redundancy packages by letting lads go in dribs and drabs as the opportunities arose and to avoid the suspicion of the unions.

    We're nearly thru this process and our standing labour costs are a fraction of what they were. We now only have to hire subcontractors as we need them for what little work we are getting.

    When the economy picks up we will be in a very strong position to capitalise.

    This is not without its downsides. We realise that when times are good again we will have to compete with our rivals to hire the better quality subcontractors and we will no doubt hire a good few wasters but overall it provides us with the flexibility that we need.

    That word, flexibility, that's the key one.
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    Politics.ie Member DaveM's Avatar
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    Quote Originally Posted by Munion View Post
    Two years ago we decided to change the business model of our small contracting firm from direct employment to nearly exclusively subcontractors.

    We've been taking the financial hit of redundancy packages by letting lads go in dribs and drabs as the opportunities arose and to avoid the suspicion of the unions.

    We're nearly thru this process and our standing labour costs are a fraction of what they were. We now only have to hire subcontractors as we need them for what little work we are getting.

    When the economy picks up we will be in a very strong position to capitalise.

    This is not without its downsides. We realise that when times are good again we will have to compete with our rivals to hire the better quality subcontractors and we will no doubt hire a good few wasters but overall it provides us with the flexibility that we need.

    That word, flexibility, that's the key one.
    Agree completely. It's what we've been doing in the contracting end of our business for years. Excluding the likes of site engineers, we only employ six site personnel (all foremen/supervisors) whereas when you include sub-contracted labour we'd probably have in and around 50 site staff around the country. We've used the same sub-contractors for years and make sure that when times are slow we look after them as much as reasonably possible so when times are good they're more loyal to us. If we employed those people direct we'd be looking at major redundancy costs over the next 6-12 months as our contrating business is has been slowing down rapidly since the start of the year.

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    Default “Fatal Blow To Seal REA’s Fate”.

    Quote Originally Posted by DaveM View Post
    Electricians suspend strike after pay rise proposed - The Irish Times - Mon, Jul 13, 2009



    When reading the front page article in the Irish Times this morning I was left wondering whether this settlement will be the end of the dispute even if the ECA and the AECI sign up to it. The NECI were excluded from negotiations again and in doing so is this simply setting the scene for a high court challenge to the REA itself? That's something that would have implications reaching far wider than just the electricians themselves.

    I got the impression that the fundamental issue for the unions in the dispute was the principle of the REA continuing to be the basis by which pay and conditions were set in the sector and that pay was a secondary (although not insignificant by any stretch of the imagination) consideration. The pay settlement on the table falls quite a way short of the TEEU's initial demands so does that support the idea that the protection of the REA the ultimate issue?

    So why exclude the NECI? Was there no chance of their signing up to any kind of agreement if they were allowed to the table? Was it the ECA and AECI that forced their exclusion in order to protect their own patch? Were the TEEU willing to talk to them? The quotes from Eamonn Devoy seem to suggest that the TEEU are of the opinion that the NECI will be bound by the agreement or is he just maintaining a positon knowing that the field is merely being narrowed so that there is only one employers body left outside the tent?

    I just get the impression that, even if the ECA and AECI sign up to the deal which is far from certain, this one may rumble on for quite a while yet.

    “Fatal Blow To Seal REA’s Fate”.

    The National Electrical Contractors Of Ireland (NECI) today welcomes the outcome of the recent Ballot carried out by Association Of Electrical Contractors of Ireland, where their members have overwhelmingly voted in favour to remove AECI from the Registered Employment Agreement in the Electrical Contracting Industry.

    The AECI has informed the other parties to the REA as well as the National Joint Industrial Council (NJIC) for the industry of the outcome of their members’ ballot issuing notice of their intent to the Chairman Of The Labour Court for their removal from the Registered Employment Agreement.

    NECI believes this mandate has delivered the Fatal Blow to the mechanism which has maintained terms and conditions and wage rates in the industry at unrealistically high levels. This has restricted direct employment and forced employers out of business resulting in employees going onto the dole or becoming sub-contractors.

    At a time when all other sectors implemented restructuring and pay cuts to regain competiveness, the Electrical Registered Employment Agreement maintained wages at a grossly inflated level which had been awarded to electricians during the ‘tiger era’. The unions’ inaction and insulting mantra, “What We Have We Hold,” over a long number of years, did nothing for job creation or for competiveness within the sector. Instead of tackling the issues of the day they seemed to instead be more focused on occupying and enjoying highly paid positions of power on state boards, as was the order of the day.

    This extremely controversial REA was entered into the Register of Employment Agreements on 24 September 1990. It has been the subject of a number of legal cases over the last number of years.

    The whole legality of this REA’s very existence and it registration remains legally questionable.

    NECI and the Unaligned Group sought an order from the court under s.29(2) of the 1946 Industrial Relations Act, to cancel the registration of the REA in its entirety. This application was made by the NECI and the Unaligned Group and opposed by the TEEU, the ECA and the AECI.
    The court applied a three-part test, set out in s.29(2) of the 1946 Act. It decided that all three parts of the test must apply before a decision can be made as to whether the registration of the REA should be cancelled:

    • The court must be satisfied that there have been changes in the circumstances of the electrical contracting industry since 1990;

    • The court must be satisfied that any such changes are substantial;

    • The court must conclude that any such substantial changes make it undesirable to maintain the registration of the REA.

    The court concluded that the sector has experienced substantial change since the REA was
    registered. However, the court concluded that those changes had not made it undesirable to maintain
    registration of the REA. Accordingly, the court rejected the application to cancel the registration of the
    REA.

    NECI is now calling for the immediate cancellation of the Registered Employment Agreement in the electrical contracting industry as there is no question that this new development has categorically satisfied the three-part test, set out in s.29(2) of the 1946 Act. This new development means that only the TEEU and the ECA (an English trade association affiliated to the CIF, with an estimated 40 electrical contractors as members) are now the remaining parties to the agreement. The majority of electrical contractors are now definitely opposed to this agreement. The minority can no longer dictate the terms for the majority.

    NECI believes the cancellation of the REA will achieve a more positive industry where direct employment will immediately reoccur instead of the subcontractor culture which this REA promoted. This will result in better quality and standards for the customer and increased revenue for the state and a reduction of the black market contractors which continues to grow in this sector.

    END

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