Law on collective agreements adopted

After 12 years of preparation and negotiation among the social partners, the Slovenian parliament finally adopted the Law on Collective Agreements (LCA) on 4 March 2006. The LCA introduces free and voluntary collective bargaining.

The Law on Collective Agreements (LCA), which regulates collective labour relations, is one of the most important parts of the new labour legislation in Slovenia and represents an important shift towards the ‘Europeanisation’ of the Slovenian system of industrial relations and labour law. Finally adopted in March 2006 after 12 years of preparation, the LCA is in line with the International Labour Organisation (ILO) Conventions No. 87, 98 and 154 on freedom of association and collective bargaining, the Council of Europe’s 1996 European Social Charter (Revised), and other European and international documents.

In the new Slovenian system of labour legislation, collective labour relations are regulated by several laws concerning different aspects. The major parts of legislation in this area are currently the new LCA (SI0212101F, SI0509301F, SI0508303F), the Law on Representativeness of Trade Unions (SI0210102F, SI0411303F), the Law on Participation of Workers in Management (SI0311102F, SI0312101F) and the Law on Strikes (SI0211101F). Individual labour relations, however, have been regulated by one comprehensive law entitled the Law on Labour Relations (SI0206101N), which is accompanied by relatively few other legal regulations.

Move to new system

The main driving force behind these changes was Slovenia’s transition from the previous ‘self-management’ system to a society based on the market economy and ‘social state’ principles. In labour law, this change is reflected by a transition from so-called ‘associative’ labour relations to ‘contractual’ labour relations.

Under the old self-management system, the function of employers, as it is currently understood, did not exist. Workers were both the owners of companies and the means of production; therefore, the Slovenian system was referred to as ‘societal’ and not ‘state’ ownership as in other socialist countries. Thus, workers were simultaneously regarded as employers and this meant that labour relations were termed ‘associative’.

Over a period of time, the division between labour and capital was recognised. Authentic trade unions emerged with a clear role to protect workers’ interests (SI0210102F). During the process of privatisation, employer organisations also appeared (SI0211102F), paving the way for ‘contractual’ labour relations.

Content of the LCA

The new LCA sets out the parties to collective agreements, the content of the agreements and the procedures in relation to the conclusion of agreements. It also covers rules on validity, termination, resolution of collective disputes and other aspects, such as registration and publication of collective agreements. Finally, the law includes a chapter on transitional provisions addressing, among other issues, employer organisations with compulsory membership.

Contentious issues

While preparing the law, the government adopted a consensual approach, which meant that the government, employers and trade unions had to agree on as many provisions of the draft LCA as possible before the government submitted it to the parliament for adoption. Therefore, the Economic and Social Council of Slovenia (Ekonomsko socialni svet Slovenije, ESSS) (SI0207103F), the country’s central body for tripartite cooperation, appointed a tripartite negotiating group to prepare the draft LCA.

However, the group did not reach agreement on the following issues:

• hierarchy of the collective agreements: the employers persistently demanded that lower-level collective agreements (e.g. company-level agreements) should always have priority over higher-level collective agreements (e.g. sectoral-level agreements) when determining different – and possibly less favourable – rights and working conditions for workers. Government and parliament adopted a different solution, in line with the trade union position.

• procedure for signing up afterwards to a collective agreement;

• extension of the validity of a collective agreement;

• employer organisations with compulsory membership: according to the LCA, these organisations – the most important of which is the Chamber of Commerce and Industry of Slovenia (Gospodarska zbornica Slovenije, GZS) – are allowed to conclude collective agreements during the transitional period of three years after the LCA comes into force. The Association of Employers of Slovenia (Združenje delodajalcev Slovenije, ZDS), with voluntary membership, demanded a much shorter transitional period.

Commentary

The social partners and the government have devoted many years to preparing the LCA. Some commentators see this as part of Slovenia’s ‘soft and gradualist model of transition’ to the market economy. Others see the delay as underlining how difficult it was to convince some social partner organisations of the benefits of free collective bargaining.

Štefan Skledar, Institute of Macroeconomic Analysis and Development (IMAD)

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