Conference Report

Crisis, debt, equality, public services, and pay

Presentation by David Hall, director of the Public Services International Research Unit (PSIRU)

Dave Hall of the PSIRU research organisation outlined the root causes of the current economic crisis, focusing in particular on how unsustainable levels of private debt had boosted economic growth. With the collapse of property markets around the world, economies sank into recession with public sector spending and borrowing central to the recovery. The presentation highlighted in particular the element of inequality in the crisis with a long-term decline in wages as a share of total output and with people increasingly reliant on mortgages to buy property as the provision of social housing declined.

Now the European Institutions are concerned about public sector debt and trying to get countries back within the stability and growth pact limits even before there is a clear sign that the European recovery is on track. Dave Hall pointed out that while the European Union and International Monetary Fund have conceded that public deficits have been crucial to stimulate the economy, they appear to take the reverse position in Latvia, Romania and the Ukraine where they are demanding public spending cuts.

He also argued that the European institutions have yet to clarify their exit strategy and that a return to normal would appear to mean back to the days of public spending restrictions but completely unregulated private sector debt.

Dave Hall concluded by showing evidence of wage trends across Europe over the period from 2002 and the fact that public sector pay had grown in line with private sector pay and the overall economy.

Colleagues from the UK, Bulgaria, Macedonia, Germany and the Czech Republic contributed to the debate raising questions about the nature of taxation and the importance of progressive taxation. They also discussed the importance of shifting the policy debate towards tackling inequality and away from the obsession with arbitrary public spending targets. The discussion also covered the role of public investment and public bonds and the development of a green agenda as part of the recovery and exit strategy.

There was some concern about analyzing trends at a European level and the need to see country-specific data as well. Dave Hall suggested that this may be relevant in certain cases but that in the disaggregated data he had looked at, including countries like Latvia, the overall arguments about public spending and inequality were still valid.

Collective Bargaining in Europe against the background of the crisis

Presentation by Vera Glassner, Researcher, European Trade Union Institute

Vera Glassner reported on the main findings of this year’s collective bargaining survey by the ETUC which covers 16 European Union countries plus Iceland and Norway. Apart from the survey data, Vera also quoted European Central Bank statistics that showed collectively agreed pay increases hovering around 2.0% to 2.5% for much of the period between 1994 and 2007.

As inflation rose in 2008 pay increases followed, reaching 3.0% but then began to fall in early 2009 to around 2.8%. However, since the first quarter things had shifted and there was growing evidence of pay freezes and even pay cuts, particularly in the public sector.

The survey found some evidence of unions shifting their strategies and considering moderating wage claims if that increased the possibility of saving jobs. There was also a trend in a few of countries of some opening clauses in agreements but this was usually specific to private sector with sectoral agreements allowing for local negotiation where companies were in particular difficulty.

There were a number of interesting responses to the crisis. In metal sector in Bulgaria there was an agreement to fight “shadow employment practices“ and to limit lay-offs in restructuring; (partial) early-retirement arrangements in Sweden were helping to increase the employment chances of young workers; in France a system of short-time working and been introduced along with a boost to training provision for 175.000 employed worker ; and in Finland there had been a wage increase in the metal sector despite a steep decline in production, as the government had improved short-time work arrangements and unemployment benefits.

Vera reported that there were data indicating a negative wage drift in some countries as employers were cutting bonuses and overtime pay. However, the general conclusions from the survey so far were that the practice of concession bargaining had been avoided as much as possible and that the key aim remained was still to maintain and increase the purchasing power of wages.

There were contributions from affiliates from Romania as well as the Czech and Slovak Republics highlighting how they were trying to deal with the challenges facing them. Public sector unions in Romania were uniting to resist the changes being imposed on them by the government in line with demands from the IMF while so far the Czech and Slovak unions had managed to maintain real increases. However, Czech unions were now faced with a potential 4% pay cut in 2010 that they were determined to fight.

Collective bargaining in the public services

Presentation by Richard Pond, Collective Bargaining Officer, EPSU

Trends in pay across the public services over the previous five years had followed a similar pattern with around 75% of agreements each year producing a real increase in pay. Across most countries – there had been one or two exceptions – negotiators had managed to recoup any loss in purchasing power from one year to the next. However, the sharp rise in inflation in 2008, followed by the sharp fall in 2009 marked a break from this trend with only 64% of the 94 agreements monitored showing a real increase in pay while the figure for 2009 so far was 75% (out of 68 agreements).

Pay cuts and pay freezes had been implemented across several countries in central and Eastern Europe as well as Ireland and Greece but not without a fight by unions. In most cases there had been national demonstrations with public sector strikes in Romania, Greece and Ireland. A strike on 24 November against a further 7% cut in public sector pay was to have been followed with a further strike on 3 December but the unions had managed to get the government back to the negotiating table.

Richard outlined different strategies of unions trying to maintain real pay levels with the Spanish public sector unions, for example, managing to prevent a pay freeze and win a modest increase in pay but one that would be adjusted if inflation increased.

Apart from overall trends Richard also outlined developments in the key areas of collective bargaining that EPSU had been monitoring in recent years – low pay and minimum wages, equal pay, outsourcing, pensions and precarious employment:

 Some agreements – local government in the UK and regional government in Germany – included flat-rate elements and so were of more benefit to the lower paid.

 Unions in Sweden argue that co-ordination had helped them secure higher increases for women workers and Norwegian public sector unions were planning to co-ordinate on this in their next collective bargaining round.

 There had been some successes in preventing outsourcing in France and Switzerland but this was still a major challenge with UK unions facing offshore outsourcing.

 Unions in the Netherlands and Slovenia were campaigning against increased pension ages while EPSU affiliates in Norway had managed to stop any major changes to their pension scheme.

 Precarious employment and particularly the spread of fixed-term and agency work had prompted action by unions in Finland, Italy, Germany, Belgium and Portugal.

Following the discussion participants agreed a statement on the crisis and collective bargaining in the public services. This underlined the need to protect collective bargaining arrangements and maintain real pay increases. EPSU deputy general secretary Jan Willem Goudriaan outlined the current discussions in the ETUC and the decision to organise a campaign in 2010, with a day of action on 24 March that would include a particular focus on the public services.

Many thanks to Lithuanian colleagues for the report on the situation in their country.

A difficult year in the life of the intersectoral social dialogue

Presentation by Stefan Clauwaert, Senior Researcher, ETUI

One of the main negotiations between the European social partners this year has been on measures on inclusive labour markets. Discussions began in October 2008 and Stefan Clauwaert of the ETUI explained that they had been very complex particularly around the role of public employment authorities and the question of individual contractual arrangements.

The social partners had also found it impossible to reach agreement on a statement on the financial and economic crisis that had been planned for the European summit in March. More recently talks on the implications of the various European Court of Justice judgements on collective agreements, strike action and posted workers (Laval, Viking, Rüffert and Luxembourg) had not led to a joint statement. In the end it was more likely that the social partners would produce a progress report and an agreement on the key issues on which they cannot agree.

The negotiations on revisions to the parental leave directive has produced some positive outcomes although Stefan also said there mixed feelings about the final result. The right to ask for flexible working on return to work and better protection against unfavourable treatment were among the good points while there was disappointment over the question of paid leave, over which the employers had threatened to pull out of the negotiations. Stefan thought that extending the right to paternity leave was also a missed opportunity.

More generally the ETUC was looking at the impact of the social dialogue, how to evaluate it, where it was going and how to improve it. An internal working group was being set up to discuss these issues before bringing them to the negotiating table with the employers. In response to a question on the Lisbon Treaty, Stefan said that the ETUC was looking into how it could use the key new articles to strengthen the social dialogue and set up a network to look at key court cases to see how the charter of fundamental rights could be used at both European and national level to protect collective bargaining and trade union rights.  

The sectoral social dialogue in the public services

Presentations by EPSU officers Veronica Nilsson, Penny Clarke, Richard Pond (in the absence of Nadja Salson) and Jan Willem Goudriaan

EPSU officers outlined the main elements of the social dialogue workplans across the five sectors – hospitals, local and regional government, national administration, electricity and gas. Retention, skill needs and violence at work were among the key issues in the hospital sector and Veronica Nilsson also described the successful completion of negotiations of the agreement on the prevention of injuries by sharps.

Violence at work had also been on the agenda of the local and regional government committee as had integration of migrants and the economic and financial crisis. Penny Clarke explained that the committee was trying to focus on getting more concrete results through improving participation and engagement and monitoring implementation and follow-up of joint texts.

The sectoral social dialogue in national administration was coming to the end of its two-year test phase during which it had made some progress on two key areas – with a joint agreement on stress and a report on the role of social dialogue in anticipating change. With Nadja Salson at a conference in Sweden, Richard Pond noted that the report assessing the test phase had been positive but that there was still some reluctance by the directors of administration in a number of countries to move to a formal social dialogue.

The key meeting was due to take place the week following the conference.

Jan Willem Goudriaan covered developments in electricity and gas. There had been progress in electricity in two major projects – one on restructuring and the other on age management. The social partners had also managed to agree a joint statement on corporate social responsibility and the principles behind achieving a just transition to a low-carbon economy. In the gas sector the social partners had managed to agree a number of joint positions on European Commission policy. A major project on demographic change and competencies had been successfully completed.

Jan Willem rounded off the discussion by reminding the conference that EPSU was committed to a full evaluation of the social dialogue across all its sectors and that the details of this process would be agreed by 2012 so that it could be undertaken and completed by 2013 in time for the Congress in 2014.

In a final short contribution, he explained that the EPSU executive committee had agreed a procedure for negotiating in multinational companies. This had been one of the topics covered by the 2008 collective bargaining conference and was aimed at ensuring that trade unions would be at the centre of the process of negotiating transnational agreements.

Working time developments in the public services

Presentation by Dr Jane Pillinger, Independent Researcher

With progress on revising the Working Time Directive now stalled, the spotlight now fell more on collective bargaining developments and the extent to which EPSU affiliates were able to make progress on working time.

In an initial report on her survey findings Jane Pillinger noted that affiliates in several countries were under pressure over working time with some moves to longer hours and certainly an intensification of work. More broadly employers appeared to be more reluctant to allow workers to take up maternity or parental leave rights or improve things for part-time workers.

Jane found that there had been some acknowledgement of the EPSU working time policy and that for some affiliates it had provided a framework for their national negotiations. However, there was still a question as the relevance of the policy and whether it needed updating. A range of pressures meant that the negotiating environment on working time had changed significantly and some unions were now questioning key targets such as the 35-hour week.

Jane’s report on working time and the EPSU policy would be completed in 2010 and she urged participants to ensure that they replied to the survey.

Implementing the EPSU Congress Resolution on Collective Bargaining and Social Dialogue

Presentation by Richard Pond, EPSU Collective Bargaining Officer

The resolution agreed at the EPSU Congress in Brussels in June 2009 covered a wide range of issues and Richard Pond summarised the main priorities, looking in particular at policies on pay increases, low pay and minimum wages, equal pay and outsourcing that had been at the centre of debates at EPSU conferences in recent years. Following the merger with PSI Europe and with affiliates from several countries in Eastern Europe joining EPSU, the problem of unpaid wages was now a more urgent matter on which EPSU needed to respond. Participants were urged to take an active role in discussing different policy areas and were invited to take part in online working groups on specific subjects in order to help frame EPSU’s approach to each issue.

Contributions from the UK and Sweden focused on how to improve the provision of information on the EPSU website and in the regular newsletter and the need to make sure that the work plan gave priority to work on trade union rights. It also needed to acknowledge the Congress resolution on tackling the structural problem of equal pay and the way that pay in sectors dominated by women was lower than sectors dominated by men.

Working Groups

Report back from three simultaneous working groups

Women and equality – Kalle Liivamägi, ROTAL, Estonia

It was apparent from the debate that many EPSU affiliates were aware of the challenges involved in achieving equality for women but that the economic and financial crisis threatened to slow down or even stop the progress. There was a wide range of contributions from countries both in and outside the European Union, with affiliates reporting different degrees of success in trying to close the gender pay gap. However, even in those country where the issue had been a collective bargaining priority there were still problems in dealing with the root causes of inequality.

Lifelong learning – Pam Cole, PCS, UK

The working group heard a wide range of experiences from affiliates in the UK, Romania, Hungary, Croatia, Finland, Belgium, Norway and Poland. It was evident that in some countries there was a substantial system of vocational training underpinned by both by the law and by collective agreement. In Poland the system seemed to be at its weakest with very little employer provision but Polish unions were taking the initiative by setting up European projects to highlight the value of proper training provision to both employers and workers. It appeared to be primarily the UK where the concept of lifelong learning had taken hold whereas in most other countries the main debate was still focused on vocational and professional training. Norway was looking at the potential for introducing union learning reps, as had been done in the UK, and this was on the bargaining agenda at national level.

Precarious employment – Mike Robinson, Unite, UK An initial presentation by Päivi Ahonen of the JHL public sector union highlighted the growing problem of precarious employment in the public services and particularly the spread of fixed-term contracts. There were similar stories from many other affiliates from across Europe and some examples where unions had managed to get the issue on the bargaining agenda but without yet securing any firm agreements to restrict precarious work.

Decent work

There were three main presentations as part of this debate. To begin with Matthias Maucher and Mauro Striano outlined a multinational project co-ordinated by the Solidar campaigning organisation that was looking at social dialogue and the problem of precarious employment in a range of sectors, with a particular focus on the domestic sector in Italy. EPSU had agreed to play an advisory role in the project and had worked with Solidar on a range of public service issues in recent years.

Pepe Galvez of the FSC-CCOO federation in Spain explained the central significance of social dialogue and the fact that an improved social dialogue agreement had allowed the public sector unions in Spain to begin to tackle a wide range of issues such as precarious employment and equality.

Sylvia Skrabs of ver.di outlined the notion of decent work (Gute Arbeit) as defined by the DGB trade union confederation in Germany and how this was a background element in ver.di’s campaign to improve the pay and employment conditions of over 200,000 social and child care workers. An important issue in the campaign was the focus on working conditions and the increased stress and workload faced by workers in the sector. The campaign involved widespread media activity and highlighted the changing working conditions in the sector. The union also worked hard to get parents to support the campaign and extra pressure was put on the employers through strike action. Overall it proved to be a major success, not only delivering higher pay for the workers concerned and an agreement on improving workers’ health but also helping to recruit 24,000 new members.

conference report