Production costs in the labour-intensive Irish horticultural sector, a long-time source of complaint by growers, are set to be reduced as a result of a controversial decision by the republic’s High Court.
It has ruled that the current system of fixing pay rates for the sector that are above the national minimum wage of €8.65 an hour is unconstitutional, and must be scrapped. Apart from farm workers, some 250,000 other employees are covered by the system, which sets a top wage rate of €9.10 an hour, and there have been calls from trade union leaders for the decision to be appealed.
But enterprise minister Richard Bruton was already planning to reform the system, having warned that the higher costs were putting jobs at risk.
Last month, a government-appointed committee on horticulture highlighted the fact that there was a 26 per cent difference between Irish and UK wage rates in the sector, which it said was damaging both exports and efforts to compete with imports.
The court decision was welcomed by the Irish Farmers’ Association (IFA), which has long campaigned on the pay issue.
But north Dublin grower Matt Foley, chair of the IFA’s national field vegetables committee, said he didn’t expect any “dramatic fall” in labour costs. “The reality is that at €8.65 an hour, our minimum wage is still one of the highest in the EU and well above the rates in the UK and Northern Ireland.”
There was further good news for the Irish fresh produce sector with an announcement by minister Bruton that he plans to introduce a statutory code of practice for the retail grocery trade later this year.
Details of how the code will be policed and funded will not be disclosed until September, when the legislation is expected to be published.
Efforts to agree a voluntary code were unsuccessful, with the multiples insisting such a code was unnecessary and would add to their costs and push up prices. However, producer groups welcomed the move, claiming it would curb what they called “retailer dominance and predatory business practices”.
