But unions and employers are still at loggerheads over whether the Labour Court should have powers to intervene in an Irish Ferries-style dispute and issue a ruling which would be binding on both sides.

Both sides were at Government Buildings this weekend with sources indicating that they are close to signing off on a deal which would ensure we don't get an 'Irish Ferries on land' type scenario.

Such a deal would see the introduction of a type of 'pay police' to enforce agreed rates up to 20 an hour. It would, however, be a complete u-turn of the voluntary manner in which unions and employers have negotiated over the last 60 years.

While Jack O'Connor of Siptu is strongly advocating this approach as the minimum requirement before agreeing a new national deal, some other unions fear that an overly legal approach could be counterproductive to workers in the long run.

Union revelations over the last few weeks that Polish and Serbian workers hired on multi-million ESB contracts were being paid one-third the agreed rate has put immense pressure on the employers to concede to the unions' demand that agreed wage rates cannot be undercut by foreign workers.

The Taoiseach's key negotiator, Dermot McCarthy, is pushing both sides to agree a deal on the cheap foreign labour issue. McCarthy fears that if a deal is done on this then the whole partnership process will unravel, leaving the Taoiseach without a partnership deal in the run-up to next year's election.

Turlough O'Sullivan of the employers body Ibec is worried, however, that establishing that locally agreed rates of pay be applied to everybody as a legal right would spark a series of "benchmarking-type claims in the private sector".

Ibec is also looking for guarantees that an enhanced Labour Court would not be able to prevent employers outsourcing Irish jobs to cheaper locations. It also wants to be able to introduce changes on the work floor without fear of breaking the law.