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Treasury Minister Allan Bell says unions and employers have to work together to avoid industrial action during a trying economic time.
Manx Telecom workers had threatened to strike over a below-inflation pay offer before more talks hammered out a settlement.
With inflation rising, Mr Bell says demanding inflation-busting rises could lead to firms laying off workers as wage bills go up.
He praised both sides in the Manx Telecom dispute, saying common sense had prevailed:
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