herald

Sunday 11 December 2016

600 workers at Irish Water to get average salary hike of €1,500 before the year ends

John Tierney
John Tierney

IRISH Water was today branded an out of control “super quango” after pay rises totalling almost €4m were awarded to 600 workers.

Staff at the controversial utility are to receive annual hikes averaging €1,500 each after a bonus payment scheme was suspended by the company late last year.

The move comes after workers’ unions took a case to the Labour Relations Commission (LRC) following a decision by the utility’s parent company, Ervia, to suspend the so-called ‘bonus’ payments last November following a public outcry.

Targets

The LRC ruled that the payments should not have been suspended, and that from January 2017, all workers should be entitled to earn between 2.75pc and 19pc of basic salary if they achieve specific targets.

Fianna Fáil Leader Micheál Martin lashed the Government for what he described as “yet another inevitable mess” at the troubled quango.

“The return of bonuses is an inevitable consequence of the decision to set up Irish Water the way they did,” he said.

“The Government has enabled a bonus culture at a utility that is squandering taxpayers’ money, racking up serious debt and actually investing less than before on bringing our water infrastructure up to scratch.

“It is very clear now the Government is willing to stand over a bonus culture at Irish Water, despite all the promises it made last year. This Government simply cannot be trusted on water reform.

“At every turn, Alan Kelly and his Cabinet colleagues have gone out of their way to shroud the activities of Irish Water in secrecy and attempt to pull the wool over all our eyes.

“Rather than admit that they were wrong, they are continuing to do everything they can to protect a deeply flawed Super Quango that is clearly out of control, at huge expense to the taxpayer,” Mr Martin added.

The payment structure was introduced in 2013 and came after Ervia told the Government in January the previous year that it would use a so-called High Performance Utility Model if it was awarded the contract to operate Irish Water.

This involved incentivising workers by linking performance with higher salaries, and no objections were raised by the coalition prior to the contract being awarded.

The LRC recommended that the performance-related pay model will be applied to Irish Water staff from January 2017, but that in the meantime an “interim arrangement” will be put in place where Irish Water employees are paid annual increments, backdated to January 2014 and paid until the end of 2016.

The payments will range from 1.5pc for some 200 workers earning between €23,800 and €47,700 per year. A higher rate of 3pc will apply for 400 workers on higher salaries.

The most recent figures show that some 29 staff earn more than €100,000, and are in line for an annual payment of €3,000 or more.

Managing director John Tierney, who earns €200,000 per year, does not qualify.

The money must be paid before the end of the year, and will cost Ervia €1.3m per year. The company has accepted the LRC’s proposals.

Anna Perry, deputy director of conciliation services, said the decision to suspend the scheme was “regrettable”.

“It is regrettable that the company chose to unilaterally resile from what had been agreed in 2012 and introduced in 2013, particularly given its ongoing position that the pay model introduced in 2013 is the correct one for the company,” she said.

She said the pay model should be implemented in full across the Ervia group, with modified proposals for Irish Water.

Outcry

The pay model led to a public outcry with senior ministers, including Environment Minister Alan Kelly, insisting he would not stand over a “bonus culture” at the utility.

A report on the pay structure in Irish Water reveals that the decision to suspend the performance-related pay model had a “hugely demotivating impact” on some workers.

The ‘Pay Model Review Report’ from consultants AON noted that the past 24 months had been “tumultuous for Ervia and Irish Water in particular”, and the decision by management not to award the performance-related payments had “impacted staff both financially and in terms of confidence”.

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