Pay in a time of turmoil
Another morning, so is there another news bombshell? With Ireland’s small open economy operating in a global context, the only question is whether the next test is on the international front or the home front, or even both!
Part of working through the current turmoil and uncertainty is for us as a HR profession to stay focussed – what are we trying to achieve in our workplaces to create better working lives. What does your team and your organisation control and influence, and is that being delivered with excellence? Are supports in place to help individuals, managers and teams deal with the uncertainty?
In Ireland, we have a low corporate tax regime, yes, matched with companies in the main paying the headline rate of tax. But Ireland is much more than that, valuing and investing in educating and developing a flexible workforce.
We are recognised as being in the top league for our educated workforce, international competitiveness, the flexibility and adaptability of our people and openness to foreign ideas, all of which make us an attractive place to invest and work (IDA, 2016).
We need to work off these strengths and not be distracted by the deliberations of those who seek to emulate our competitive advantages. We must avoid damaging our credibility by not managing our labour cost competitiveness, industrial relations and social issues.
The growth in the economy and increase in employment, are serving to exacerbate claims for pay increases and a renegotiation of the Lansdowne Road Agreement. All aspects of society have taken a hit during the recession, with a reduction in income and welfare payments. Ultimatums from both public and private sector unions for pay increases are unhelpful when our level of indebtedness as a country is still very high, and we have serious problems to address in our housing and social services.
At this point in time pay restoration should concentrate on addressing the inequities which exist in the workforce. While we have limited capacity to deal with pay claims, these should focus on the lower paid and removing current inequities. This will require a mature approach on all sides, and will need to be dealt with in a constructive and orderly fashion.
We can’t control the external winds of change, but let’s make sure we improve practices in people management that will benefit not only individuals but also the economy and society as a whole.