3.3 million workers lose out because member states fail to protect collective bargaining

Cover

At least 3.3 million fewer workers are benefiting from a collective bargaining agreement across the European Union today compared to the beginning of the century, the latest figures show.

Collective bargaining coverage is down in 22 of the EU’s 27 member states since 2000 as a result of deliberate policies implemented by member states and endorsed by the European Commission, often because of a mistaken idea that high levels of collective bargaining are bad for the economy.

The facts show that the opposite is true and that strong collective bargaining systems contribute to higher wages and better working conditions, as well as to a fairer society and to better economic performances.

The biggest fall in the percentage of workers covered was in Romania (100% to 23%), Greece (100% to 25%) and Bulgaria (56% to 23%), according to figures from the University of Amsterdam. 

The figures also show the number of workers covered has gone down in 9 of the 15 countries for which data is available, including Greece (-1.2m), Germany (-884,000) and Hungary (-439,000).

There is now a huge disparity in coverage between countries across the EU, with just 7% of workers benefiting from collective bargaining in Lithuania compared to 98% in Austria.
 

Source: Jelle Visser, ICTWSS Data base. version 6.1. Amsterdam: Amsterdam Institute for Advanced Labour Studies AIAS. October 2019; OECD Stat.

The data shows falls in coverage in the following countries:

 

Member state % Coverage 2000-2002 % Coverage 2016-18 Difference in number of workers covered
       
Lithuania 15% 7%  
Latvia 18% 14%
  • 59,000
Poland 25% 17%  
Greece 100% 25%
  • 1.263 million
Estonia 23% 19%  
Hungary 38% 21%
  • 439,000
Bulgaria 56% 23%
  • 254,000
Romania 100% 23%  
Slovakia 51% 25%  
Czechia 35% 30%  
Ireland 44% 34%  
Cyprus 65% 44%
  • 10,000
Croatia 64% 45%
  • 120,000
Malta 57% 50%  
Germany 68% 54%
  • 884,000
Luxembourg 60% 59%  
Spain 75% 68%  
Portugal 78% 74%  
Netherlands 82% 78%
  • 80,000

Source: Jelle Visser, ICTWSS Data base. version 6.1. Amsterdam: Amsterdam Institute for Advanced Labour Studies AIAS. October 2019; OECD Stat.

The ETUC is highlighting the figures during the European Commission’s consultation on fair minimum wages.

The Commission’s first stage consultation document stated: “Collective bargaining is an essential element of the social market economy promoted by the EU and a strong foundation for good wage setting.”

The ETUC believes the Commission needs to use its initiative on fair minimum wages to protect collective bargaining where coverage is already high and extend it in countries where it is low, in order to reduce inequalities, improve working conditions and raise productivity.

ETUC Deputy General Secretary Esther Lynch said:

“Raising statutory minimum wages is the bare minimum needed to keep people above the poverty line, but collective bargaining is the best way to ensure workers receive a genuinely fair share of wages, as well as combatting the gender pay gap and providing good conditions for non-standard workers.

"Member States’ failure to act to promote workers right and ability to collective bargaining is holding all wages back. Low collective bargaining means also lower minimum wages: fair minimum wages can only be created in labour markets with effective collective bargaining systems which ensure an adequate coverage.

“It’s positive that the European Commission has recognised that collective bargaining is essential for a fair economy. It’s now logical that they need to promote collective bargaining, in particular where the numbers of workers covered are low. However, the EU should not interfere where there are no problems with collective bargaining.

“This can start with a requirement for the €2 trillion (14% of GDP) a year of public spending on services, works and supplies to go to firms with a collective bargaining agreement.”