The Irish Congress of Trade Unions is advising unions in the private sector to seek pay increases of between 3.5% and 4.5% in 2020.

Congress General Secretary Patricia King said that despite the fact that average yearly earnings increased by 4.7% in the private sector in third quarter of this year, all the indicators demonstrate that Ireland remains a low pay economy.  

According to recent figures from the Central Statistics Office, median weekly earnings stood at €592.60 a week or €30,815 a year in 2018.  

Ms King pointed out that in the accommodation and food sector, 68.1% of workers earn below €400 a week, while 43.9% in the wholesale and retail sector earn less than €400 per week. 

"The position of female workers is even more stark, with the median weekly wage being €523.25 or €27,209 per annum. Low pay is also endemic amongst young workers," Ms King added.

ICTU said the current statutory wage-setting mechanisms have been rendered "useless" by an effective veto exercised by the employers through non-participation in the Joint Labour Committees (JLCs) system. 

It has called for legislative reform to ensure that the system of JLCs can function more effectively. 

"Structured collective bargaining is one of the most effective means of eliminating low pay and Government must act to support the functioning of collective bargaining," Congress stated. 

Dr Tom McDonnell, of the Nevin Economic Research Institute (NERI), said that while poverty and deprivation were falling, one in six people are experiencing deprivation and can only manage to pay for basic essentials, for instance, some may have to do without new shoes or clothes. 

"Ireland has a very high level of market inequality before tax and therefore social welfare payments have to compensate, this in effect subsidises low pay," Dr McDonnell said.