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    Business lobby wants to freeze low pay until 2018

    Posted on March 26, 2015 by administrator

    The chief of the main small employers’ group has told low-paid workers on the minimum wage of €8.65 that “they are paid what they’re worth”. He wants the pay floor frozen for at least the next three years.

    Five years ago the Small Firms Association (SFA) successfully lobbied the Fianna Fail government to slash the minimum wage by €1 to €7.65 claiming that it was too high and would cause job losses. The rate was restored by the Fine Gael/Labour coalition in 2011 after it emerged that some hoteliers tried to force staff to take compulsory cuts in their minimum rates.

    AJ Noonan, who has run a recruitment agency for the past 25 years, is chairman of the Small Firms Association. In recent years with the recruitment fall-off he has diversified into property development for health centres and care homes. The wealthy company chief told an Oireachtas committee that he was amused by union arguments for considering a ‘living wage’. He called their demand for a review of the current minimum wage rates as “laughable”.

    The business chief said that he had “listened with a certain amount of amusement to the contribution of the previous trade unions delegation and the proceedings at the recent party conferences.[Fine Gael and Labour] ”

    “This is the year of the sheep in China but to many in Ireland, 2015 appears to be the year of the pay rise. Rather than it being the year of increased productivity, tax equality for the self-employed or increased competitiveness, it is the year of the wage increase, for which small businesses and businesses in general are expected to pick up the tab”, he added.

    He complained that “I firmly believe that the low pay commission is but a fig leaf for an increase in the minimum wage, and I have grave concerns about that. It is basically an increase in the cost of production. This is the Government reneging on its responsibility in terms of the redistribution of wealth. Businesses are not about wealth redistribution – we are about creating jobs and creating wealth for distribution.”

    Mr Noonan said that smaller firms did not use the ‘opt out’ mechanism is they were losing money because “business people do not go to the Labour Court in some cases is embarrassment about their inability to pay; instead, they will make a couple of people redundant.”

    SFA director, Patricia Callan, said that the National Minimum Wage should be frozen so as to “give small businesses, who are just starting on the recovery path, certainty over their labour costs, which is essential in particular to businesses operating in the sectors and regions most affected by the NMW.”

    This weekend Ms Callan said that “the market value of worker productivity must be reflected in wage rates particularly in a very small open economy such as Ireland.” This chimes with Mr Noonan’s arguments that the low-paid are paid as much as they’re worth.