COORDINATION OF COLLECTIVE BARGAINING

1. The action programme of the Prague Congress stressed the importance of strengthening the coordination of collective bargaining. Recent developments underline this even more. With rising unemployment and continuing restructuring in all European sectors, trade unions are facing difficult bargaining positions and risk once again being confronted with the danger of competitive wage dumping. Meanwhile, employers and governments are themselves ‘coordinating’ on an European level and do not hesitate to misrepresent social agreements or government measures in one country to increase pressure on trade unions in the rest of Europe. Moreover, trade unions in Europe have to address the fact that European institutions themselves are calling for even more wage moderation and reforming national collective bargaining systems in the direction of more decentralisation [1] Finally, sharp wage differentials in the Europe of 25 risk being exploited with workers in the new member states not receiving their fair part of the increase in economic welfare and productivity.

Developments during 2003

2. Trends in collective bargaining during 2003: generally in line with ETUC recommendations. Based on the report of the Committee for the coordination of collective bargaining, the ETUC notes the following trends over 2003:

a) In a majority of cases, the guideline, adopted by the ETUC in its November 2002 Executive Committee Resolution, for wage negotiations to compensate for inflation and translate productivity increases into real wage increases to the maximum extent possible has been followed quite closely. Most countries, but not all, have indeed seen a trend of wage increases as high as the sum of inflation and national productivity. In particular, some countries (UK, Denmark, Sweden) have even exceeded this guideline over the past years [2] . b) In 2003 and previous years, a majority of trade unions in the EU - 15 succeeded in maintaining the purchasing power of wages. On the contrary, when governments, such as the Italian government, approved an inflation target far below the dynamic of the real inflation rate as a guideline only for wages and not for prices, then the result has been a sharp fall in purchasing power for workers. c) Collective negotiations have also followed up on the recommendation to improve qualitative working conditions as part of collective agreements. In many countries (Germany, France, Italy, Belgium, Portugal...), special attention was paid to lifelong learning of workers by negotiating training issues in collective agreements. A number of countries (Denmark, Belgium) have negotiated reductions in collective working time, whereas collective agreements in France have defended the 35-hour week against the decisions by the new French Government. Mandatory minimum wages are increasing quite rapidly in several countries, in particular in the UK and in some eastern European countries. In contrast, progress on the gender wage gap has been piecemeal, and public sector pay increases are under pressure from the public deficit objectives set by national stability and convergence plans in the context of the Stability and Growth Pact.

ETUC Guidelines on Collective Bargaining 2004

3. Prospects for 2004: In order to avoid the risk of competitive wage dumping, the ETUC calls upon a strict follow-up of the coordination guidelines. The ETUC underlines, as a priority, the need to avoid the possible vicious circle of competitive disinflation in the 2004 collective negotiations. This is now even more urgent in view of the need to revive household demand as a means of tackling the current economic slowdown. Instead, collective bargaining outcomes that are in line with the sum of inflation and productivity are necessary in order to allow wage income to perform its function of motor of consumption expenditure and aggregate demand, while at the same time preserving price stability.

4. Strengthening the qualitative issues of collective bargaining. In view of the current worsening situation, it will be necessary in the coming months to seek to step up our initiatives, particularly in the field of equal pay and precarious employment, in accordance with the decisions of the Prague 2003 Congress and the Executive Committee Resolution of November 2002. We are aware of the difficulties involved in achieving this at the national level, where actual results do not reflect a lack of interest or change of priority. On the contrary, the Collective Bargaining Coordination and Worker Participation Committee of the ETUC underlined at its last meeting in November 2003 the importance of reviving our general initiatives on these activities and the need to deepen all aspects of work quality. Better relations with European Industry Federations are vital in view of the fact that many of the qualitative elements of bargaining are dealt with at the sectoral level.

5. Coordination on working time. Concrete experience confirms that prolonging working hours and more liberal regimes allowing overtime will not create new jobs but will in the end lead to even more unemployment. The GDP gap with the US should not be narrowed through intensification of working hours and labour related stress. The revision of the working time directive, ending the opt-out regime in this directive, is an opportunity that must be seized to put absolute limits on this form of flexibility competition. In any case, the ETUC confirms the need to negotiate working time regimes, with the purpose of guaranteeing the interests and the needs of workers by increasing security in adaptability. Consequently, with regard to weekly and overtime working time regimes, we strongly support the principle that a point of reference must be found in relation to a qualitative life balance for workers and their right to effective social protection.

6. Insuring progress for all workers. The ETUC calls on trade unions to oppose pressure from employers to realise the decentralisation of collective bargaining in a unilateral way and hence to preserve and defend the basic elements of the sectoral/multi-employer bargaining system. Multi-employer bargaining systems go hand in hand with ‘solidaristic’ wage policies and assure that all workers, whether they work in small or big companies share in overall economic progress. In 2004 special attention is to be paid to the objective of increasing the net purchasing power of low paid workers. Also, increased attention has to go to health and safety matters. The general worsening of working conditions, the increase of labour productivity, the use of a-typical workers and the reduction of investments to prevent accidents on the workplace are the main reasons why there has been an increase in workplace accidents at European level. With regard to the new Member States, safety at work is threatened by the combination of increasing industrial production and the use of a-typical worker statutes. It is thus necessary for us to focus on health and safety protection as a priority and demand clear information for trade union representatives as to their negotiating rights, together with an effective system of control and inspection by the public authorities.

7. Campaign for equal pay. As the Prague Congress underlined, a wage gap continues to exist and is even widening. Statistics show that the difference between men’s and women’s wages remains and that the average wage for women is 16% less than that for men. In earlier resolutions, we have already examined the causes and have drawn up a trade union strategy, based on collective bargaining, to face up to this situation. We reiterate our commitment to follow up this strategy even more strongly with the multiannual work programme - as approved by the Executive Committee on 14 December 2001 - with the aim to reduce the wage gap between women and men by 2 - 5% in the forthcoming years. In order to realise this objective, actions must be developed at the national and sectoral levels based on collective bargaining and, in particular, on the revision of job classification, including systems of evaluation. It is also important to utilise the results of negotiations in the European social dialogue on the framework of actions on gender equality in which the issue of equal pay is one of the key areas of debate.

8. Contributing to the Lisbon agenda of the knowledge society. As quoted in the report of the task force on employment, business has to break out of the vicious spiral of under-investing in training of workers. Trade unions will continue to strive for and improve collective agreements concerning training efforts and lifelong learning for workers. In committing a well-defined financial percentage of the wage bill to training efforts and sectoral or intersectoral funds, collective agreements overcome the free rider problem that is at the root cause of such under-investment and can play an important role in securing the right for every worker to be able to enjoy lifelong learning. In this regard, it will be essential to follow-up the "framework of actions on the lifelong development of competences and qualifications" signed by Social Partners in 2002. Only with more concrete and coherent actions aimed at implementing this framework of actions at national and sectoral levels will we be in a position to support this key issue of the Lisbon strategy.

9. Continue to build strong systems of collective bargaining in eastern Europe. The ETUC considers enlargement as an historical opportunity to build a strong and unified Europe. But if all workers are to benefit from the economic consequences of enlargement, the systems of collective bargaining in the new Member States have to be strengthened. The ETUC Seminars in Gdansk in 2002 and Budapest in 2003 were a very useful step in this direction and they also helped to build awareness of the actual reality in these countries. It is now even more important to develop these activities since enlargement represents a completely new challenge for the coordination of collective bargaining strategy as a whole. For this reason, it was agreed at the Collective Bargaining Coordination and Worker Participation Committee that the next Summer Seminar will be dedicated more particularly to this new framework. In addition, it is important that the EU social dialogue experience be widely disseminated in order to strengthen current weaknesses in industrial relations, with the aim of increasing the quantity and quality of bargaining and of creating more collective bargaining structures in order to defend workers. The ETUC will work towards this objective with the help of the different instruments available and stronger relations with national trade unions and European Industry Federations. Another important instrument is the "work programme of the European Social Partners 2003-2005", regarding the new Member States. In fact this programme foresees many joint actions, such as industrial relations, lifelong learning, restructurings, social dialogue and EWC, social and economic policies, aimed at increasing the European acquis in the new Member States.

10. Strengthening the practical application of the ETUC guideline. In order to assure the practical implementation of the coordination guideline, trade unions will engage in a more intensive exchange of information on ongoing negotiations. Through seminars, the ETUI-newsletter and the meetings of the ETUC committee on the coordination of collective bargaining and worker participation, the ETUC will organise a transparent flow of information on the different collective bargaining rounds. It is also useful to make the ETUC’s coordination activities better known amongst workers and collective bargainers.

PARTICIPATION OF WORKERS

11. Industrial relations and participation instruments are extremely important in the present political and economic climate. The common viewpoint amongst employers and many governments that participation and concertation policies are difficult to implement in times of economic slowdown or crisis, whereby enterprises are left with more freedom and unilaterality, must be countered.

12. On the contrary, as positive experiences and solutions have shown in the past, we are convinced that all processes of change or restructuring are better managed when trade union and worker participation, at the different levels, is solid and well structured, Furthermore, we are firmly convinced that a social Europe has to safeguard the participation of workers and trade unions in plants and companies at European level companies. Guarantors of this are information, consultation and worker participation. Workers must be informed and consulted fully and in good time as a standard and daily practice forming the basis of employer/employee relations.

13. For this reason, we must confirm our capacity to act on this subject in a continuous and rigorous manner at the different levels. Especially in light of the enlargement of the European Union, greater emphasis needs to be placed on working together to ensure the sustainability of the European Social Model. Workforce participation is needed if this challenge is to be met. European Works Councils play a key role in this, ensuring that workers’ interests are taken into account when companies make decisions. For this reason, we demand the prompt revision of the EWC Directive, in accordance with the resolution which was adopted by the Executive Committee in December 2003.

14. In addition, we demand that worker participation in the event of cross-border mergers be regulated along the same lines as the European Company Statute (SE) Directive. The arrangement governing participation in the Mergers Directive gives workers the participation rights customarily awarded by the central management of the merged company. This reference to the applicable national provisions on participation may result in the loss of existing arrangements governing participation. ETUC finds this unacceptable. We demand that the Commission corrects the Mergers Directive accordingly. The compromise of the European Company (SE) should not be called into question again.

15. The European Commission has proposed an Action Plan on Modernising Company Law and Enhancing Corporate Governance in the EU. The Commission cites the following as central political objectives: increased efficiency and competitiveness of companies in the EU, the strengthening of shareholders’ rights, and better protection of third parties. Whilst these aims and the resulting Commission initiatives should not be rejected, ETUC believes they should be linked up with initiatives in the area of ’participation’. This applies in particular to topics that are especially sensitive from workers’ point of view, such as facilitating the freedom of establishment of companies or the European Private Company and other European legal forms of enterprise. The involvement of workers and their representatives must be a component of modern European corporate law. We find it unacceptable that the Communication makes no mention of the information, consultation and participation of trade unions and workers and provides no role for them to play.

16. The European Commission initiative on Corporate Social Responsibility (CSR) prompted a discussion on codes of conduct in Europe. In this debate, ETUC holds the view that companies’ behavioural guidelines, such as codes of conduct, corporate governance codes, and so forth, can only supplement those workers’ rights to participation that already exist in the EU Member States. We cannot allow such codes of conduct to weaken workers’ rights to information, consultation and participation.

17. The prompt and correct transposition at the national level in all 25 member states of the Directive on the SE and that on the information and consultation of workers is fundamental. In this regard, we consider that the establishment of a monitoring body would be useful to provide support, both on the legal and the technical aspects, during all the different phases of transposition at the national level.

Annex 1

1.1.1 Table VX

Wages per head minus inflation plus productivity per head

2000 2001 2002 2003 Belgium -2,5 2,1 1,6 -0,4 Germany -0,4 -0,6 -0,6 -0,8 Greece -1,3 -2,8 0,6 -0,2 Spain -0,4 0,6 -0,3 0,4 France -0,6 0,5 0,4 0,3 Ireland -2,5 1,7 -5 0,2 Italy -0,9 0,6 0,5 0,7 Luxembourg -2,4 5,8 3 1 Netherlands 0,8 0,4 1 1,5 Austria -2,2 -1 -0,9 0,4 Portugal 1,3 0,8 1,4 -0,9 Finland -2,1 2,3 -1,6 0 euro 12 -0,5 0,4 0,2 0,1 Denmark -1,3 1,4 -1,2 -0,1 Sweden 3,7 3,1 0,1 -0,2 UK 2,4 1,9 1,3 1,5 EU 15 0 0,6 0,2 0,3

(source: European Commission)