Imposing 300 million euro of public-sector cuts will shrink the economy and cost jobs, a union has claimed.
As industrial relations mediator Kieran Mulvey entered his last day of talks to break the deadlock between Government and trade unions, Unite said the proposal would have almost no impact on the deficit.
A deal must be struck on a possible renegotiation of the pay deal or the Government will legislate to shave the 300 million euro off its pay and pensions bill this year, and one billion euro by 2015.
Unite's regional secretary Jimmy Kelly called on Labour to defend workers and reject Fine Gael's drive for legislation, which it claimed will cost 1,500 jobs, half of which would be in the private sector.
"There is no economic reason to impose these cuts," said Mr Kelly. "They are not necessary to reach the Government's budget targets. They are optional and they are the wrong option. There are viable alternatives to austerity-led economics, alternatives which will grow GDP, create jobs and still meet our deficit reduction targets.
"The economy doesn't need a 300 million euro cut - it needs a 300 million euro boost."
Labour's Brendan Howlin, Minister for Public Expenditure and Reform, last week gave Mr Mulvey an extension to see if there are grounds to re-run negotiations after the revised Croke Park deal was rejected. He must report back to Mr Howlin later on Monday, who will bring the latest updates before Cabinet on Tuesday.
His party leader Eamon Gilmore said he preferred a negotiated settlement rather than driving through legislation, but warned time was not on the Government's side.
"We do have to achieve the savings," he said at the Labour Party's annual commemoration at Arbour Hill cemetery on Sunday. "There's been quite an amount of time now spent since the ballot in consultation. I would hope, and our preference remains, that there should be a negotiated solution."
Siptu president Jack O'Connor admitted there is some possibility of an agreement being reached, but warned people's tolerance for austerity has expired because they have no more to give. He stressed the talks should be centred on innovative ways of organising working time, and not on cutting the pay of middle and low income workers.