2000 Annual Review for Luxembourg

This record reviews 2000's main developments in industrial relations in Luxembourg.

Political developments

No elections were held in Luxembourg in 2000. The country has been governed since August 1999 by a coalition made up of the Social Christian Party (Chrëschtlech Sozial Vollekspartei, CSV) and the Democratic Party (Demokratesch Partei, DP).

On 7 October 2000, Grand-Duke Jean abdicated in favour of his eldest son Henri, after being on the throne for 36 years. Prince Guillaume was subsequently made Crown Prince on 19 December 2000, thus confirming the continuity of the ruling dynasty in the long term.

Collective bargaining

Collective bargaining during 2000 generally focused on traditional issues such as pay. There were few notable changes to employment terms and conditions. A total of approximately 250-300 collective agreements, mainly at company level, are currently in force in Luxembourg, with some 100 agreements renewed each year.

Pay

Collective bargaining up to May 2000 resulted in average annual increases of 1% .

On 29 May, after seven months' negotiations, a new pay agreement was reached between the government and the General Public Sector Confederation (Confédération Générale de la Fonction Publique, CGFP). The new accord applies to 16,000 civil servants directly, and indirectly affects another 24,000 "assimilated" staff (LU0007141F). It provides for pay increases of almost 6% over two years, and introduces part-time working on the basis of 25%, 50% and 75% of full-time hours. The nationally representative trade organisations, the Luxembourg Confederation of Independent Trade Unions (Onofhängege Gewerkschafts-Bond Lëtzebuerg, OGB-L) and the Luxembourg Confederation of Christian Trade Unions (Lëtzebuerger Chrëschtleche Gewerkschafts-Bond, LCGB), described this deal as significant, maintaining that it might signal an end to the pay restraint policy consistently advocated by the government. They also maintained that future negotiations in other sectors should be based on this agreement, which could form the basis of higher pay and pension provision in the private sector.

The first reaction to the public sector pay deal took place in the construction industry, where a new collective agreement was concluded on 19 June at the National Conciliation Office (Office National de Conciliation, ONC), narrowly averting strike action (LU0007140N). The accord increases hourly rates of pay by 5.1% over three years and stipulates that actual hourly rates should be increased by 3.5% during the same period.

In the key iron and steel industry, discussion in 2000 focused on the introduction of new pay scales into the sector's collective agreement for white-collar workers (LU0003130N). Trade unions and employers have differing positions and it was decided in February 2000 to invite an outside management consultant to produce a report based on a set of criteria to be drawn up by the social partners.

Working time

The issue of working time featured in a number of sectoral negotiations during 2000. In the construction industry, the main stumbling block in bargaining was working time flexibility. The employers had sought a one-year reference period for averaging out working hours, in order to compensate for hours lost due to bad weather, mainly through Saturday working. However, trade unions were opposed, and the final accord did not contain any provisions relating to flexible working hours (LU0007140N).

In the cleaning sector, a new three-year collective agreement was signed on 15 December 1999 and came into force on 1 January 2000. The agreement introduced a three-month reference period for averaging working time, guaranteed that workers may not be obliged to work more than five days a week and set out regulations related to part-time working (LU0001123N).

Job security

There was scant reference to job security provisions in collective bargaining during 2000, largely due to the fact that Luxembourg has, for the past 15 years, experienced a steady growth in employment. Thus, very few collective agreements even make reference to the need for job security. However, under the terms of the law of 12 February 1999, relating to Luxembourg's National Action Plan (NAP) for employment (LU9903195F), the social partners are enjoined to safeguard levels of employment.

Training and skills development

Although there is a statutory framework for supporting and developing continuing vocational training in Luxembourg, in the form of the law of 22 June 1999, collective agreements rarely include provisions relating to training and skills development. Despite the fact that the February 1999 law which relates to Luxembourg's NAP states that collective agreements should include provisions relating to training policy at company level, most agreements merely include a generally-worded provision in this area.

Legislative developments

The main legislative event of 2000 was the adoption of new legislation designed to combat sexual harassment in the workplace. The new law was adopted on 26 May (LU0005137F) and includes a shift in the burden of proof but contains no legal sanctions. The content of this new law largely takes its inspiration from proposals contained in the European Commission's Recommendation on the protection of the dignity of women and men at work and the Code of Practice on protecting the dignity of women and men at work, both adopted on 27 November 1991.

The legislation states that sexual harassment at the workplace is sexually suggestive behaviour or any other kind of sexual behaviour that the perpetrator knows, or should know, affects the dignity of a person at work. The behaviour may be physical, verbal or non-verbal. The person who claims to be the victim of sexual harassment must initially furnish proof of harassment and must then prove the existence of conduct that meets one of the criteria for sexual harassment set out in the law. If this fact is proved by the victim, there is a presumption of the perpetrator's intention. Employers are responsible for any act of sexual harassment carried out by their employees, clients or suppliers at the workplace or at work if they have not taken reasonable measures to prevent such harassment taking place. Trade unions are urged to play a key role in preventing sexual harassment at work. In collective bargaining, the question of introducing appropriate clauses designed to create a working environment with no sexual harassment will now be compulsory, and must provide for a declaration of principle and a scale of disciplinary measures.

In addition, legislation providing for the transposition of EU Directive 94/45/EC on European Works Councils (EWCs) was finally adopted on 28 July 2000 (LU0101157F) (see below under "Information and consultation of employees").

The organisation and role of the social partners

On 29 April 1999, a new collective agreement for the banking sector was signed by the Association of Luxembourg Banks and Bankers (Association des banques et banquiers du Luxembourg, ABBL) and, on the trade union side, by the Luxembourg Association of Bank Staff (Association luxembourgeoise des employés de banque, ALEBA), acting on its own behalf and also representing the ALEBA-Union of Private Sector White-Collar Employees (Union des Employés privés, UEP) Federation (Fédération syndicale ALEBA-UEP) (LU9905104F). The agreement was not signed by OGB-L or LCGB.

By a ministerial decree of 1 December 1999, the Minister of Labour blocked registration of the collective agreement, on the grounds that the signatory unions did not have "nationally representative" status, thereby denying ALEBA and UEP such status (LU9912117N). For a collective agreement to be valid, it must be registered and have the support of one or more of the "most representative trade union organisations at national level". On 2 December, ALEBA and ABBL filed an emergency appeal and a basic appeal against the Minister's decision before the Luxembourg Administrative Tribunal (Tribunal Administratif). In January, the president of the Tribunal ordered that the measures contained in the collective agreement should be made provisionally applicable on the grounds that failure to do so would cause employees serious and lasting detriment (LU0002128F).

On 24 October 2000, the Administrative Tribunal delivered its verdict on the substance of the case as to whether ALEBA met the statutory criteria to be considered a nationally representative union (LU0011152F).

The Administrative Tribunal disregarded previous case law and a criterion that has always been used to establish whether a union could be deemed to be nationally representative: the criterion of "multi-sectoral representative status". Instead it deemed the most nationally representative trade unions to be those that represent a large number of white-collar staff in the private sector or blue-collar workers, by comparison with the total of white- or blue-collar workers in the country as a whole. Thus, ALEBA was awarded national representative status.

The Minister of Labour appealed against this ruling, and the matter will be finally determined by the Administrative Court (Cour administrative), Luxembourg's supreme administrative court.

Luxembourg's rules on nationally representative status were further called into question when ALEBA complained about its treatment by the Luxembourg government to the International Labour Office (ILO) in Geneva. In March, the ILO Committee on Freedom of Association called on the Luxembourg government to review the criteria for nationally representative status on the grounds that they run counter to the principles of freedom of association (LU0004135N).

At international level, an interesting development in 2000 was a meeting between trade unions representing road haulage workers in Denmark and Luxembourg, in response to increasing relocation of Danish transport firms to Luxembourg (LU0002127N). The unions demanded concrete political measures against outsourcing and "social dumping", and also EU legislation on drivers' working hours.

On the employers' side, a new organisation, the Union of Luxembourg Enterprises (Union des Entreprises Luxembourgeoises, UEL), was set up in June (LU0011151F). UEL brings together 34,000 enterprises representing 85% of the country's GDP. Its aim is to establish itself as a new influential partner in the economic and social fields. It succeeds the Employers' Liaison Committee (Comité de Liaison Patronal, CLP), a body that embraced a number of federations and professional chambers, but whose impact had been seen as somewhat sporadic (LU9801138N). The new organisation hopes to play a new role which is not defensive, but rather "in the interests of developing the national economy, by promoting the spirit of enterprise and the courage to take risks".

Industrial action

There were two strikes in 2000. The first was involved doctors and dentists. Unhappy with a government plan under which doctors and dentists would contribute more to the financial stability of the sickness insurance schemes, they walked out of a quadripartite meeting and on 2-3 November took industrial action. The government subsequently withdrew its proposals (LU0011150N).

The second strike took place following an incident which occurred on 25 November. A vehicle belonging to the Brink's Ziegler security firm was the object of an armed attack, as a result of which a cash-in-transit operative subsequently died. Two days later, a spontaneous protest by security staff developed into a fully-fledged illegal strike that lasted seven days (LU0012153F). A sectoral tripartite meeting on 2 December subsequently managed to identify solutions that focused on strengthening safety measures, and provided for the payment of a 13th-month bonus and an end-of-year bonus of LUF 15,000.

Despite a budgetary surplus in the sickness insurance funds, a general meeting of the Union of Sickness Funds (Union des Caisses de Maladies, UCM) on 15 November resolved to retain the reduced benefits and increased contribution rates that had been decided upon in 1999. This caused the OGB-L union confederation, at a meeting on 21 November, to initiate a procedure for calling a general strike (LU0012154F). This decision was also prompted by the government's attitude, which the unions viewed as unnecessarily "authoritarian".

Overall, six disputes were referred to the National Conciliation Office in 2000, compared with 15 in 1999.

National Action Plan (NAP) for employment

In February 1998, in the context of transposing the new EU Employment Guidelines, the Luxembourg government decided to draw up an NAP aimed at combating unemployment, through consultation with the social partners within the framework of the Tripartite Coordination Committee (Comité de Coordination Tripartite). During the legislative procedure, the NAP was hotly debated by the various professional chambers representing employers, employees and other interests (LU9811174F). The final text underwent 56 amendments drawn up at various levels of the legislative procedure before it was finally adopted by the Chamber of Deputies on 3 February 1999 (LU9902194N). Since the law implementing the NAP was adopted (LU9903197F), the social partners have been unable to reach agreement on how to interpret the terms of the law, which incorporated new legislation on the organisation of working time, and have criticised one another for being unwilling to abide by previous commitments.

The government that came to power in August 1999 (LU9909111N) arranged a number of meetings under the auspices of the Tripartite Coordination Committee from 27 March 2000 onwards: their main aim was to draw up a new NAP to present to the European Commission by 1 May 2000. However, the process of drawing up a new NAP was suspended in May due to differences between the social partners, and a small working party was set up to deal with outstanding problems (LU0006138F). However, it was not until November that negotiations between the social partners - which focused on working time organisation - resulted in an agreement that allowed the content of the NAP to be drawn up in detail. The relevant legislation was to be drawn up in the near future.

Matters relating to part-time working and the European Commission's recommendations to Luxembourg on employment policy were being dealt with by working parties, which were due to submit their proposals in early 2001.

Equal opportunities and diversity issues

The main legislative event of 2000 in terms of equality was the adoption of a new law on 6 April 2000 on sexual harassment at the workplace (see above under "Legislative developments").

General anti-discrimination legislation already exists in Luxembourg, in the form of legislation dating from 19 July 1997. This law is aimed mainly at combating discrimination based on health, age, sexual orientation and religion, as these areas are not covered by collective agreements.

Information and consultation of employees

On 28 July 2000, Luxembourg adopted a law transposing EU Directive 94/45/EC on European Works Councils (LU0101157F). Luxembourg was the last EU Member State to transpose the EWCs Directive - some four years after the deadline for implementation and after a European Court of Justice ruling for non-transposition (EU9911209N). It is estimated that some 15 multinational companies based in Luxembourg fall within the scope of the legislation.

At national level, Luxembourg's highly developed system of tripartism and employee representation is well established, with its operation normally eliciting little comment. However, 2000 saw an unusual dispute in this area, with the OGB-L trade union confederation accusing the Luxembourg-based Clearstream finance group of undermining the operation of staff representative bodies, and particularly by refusing to set up a statutory company joint committee (comité mixte d'entreprise) (LU0011149N). The Labour and Mines Inspectorate (Inspection du Travail et des Mines, ITM), which is responsible for overseeing the law in this area, conducted an enquiry and concluded that Clearstream was obliged to set up a committee. When it refused to do so, the ITM threatened to appoint the committee itself and refer the matter to the State Prosecutor with a view to seeking criminal sanctions. OGB-L subsequently accused the company of further interference with the operation of its employee committee/works council (délégation du personnel).

New forms of work

The policy statement made by the government when it came to power in August 1999 (LU9909111N) reaffirmed broad principles governing employment policy and law and emphasised that the acquired social and employment rights should be maintained. It was also agreed that new forms of employment such as teleworking and homeworking would be encouraged so as to achieve better reconciliation between family and working life. Before commencing work on regulation, the government undertook to study the use made of these new forms of working and their practical application, so as to identify current shortcomings and difficulties as well as any requirements that flow from them. OGB-L believes that this work needs to be started jointly by the government, the employers and the nationally representative trade unions, and has asked the Minister of Labour to call a meeting to this effect (LU0003129N).

Other relevant developments

The November general meeting of the Union of Sickness Funds (UCM) which acts as an umbrella group for Luxembourg's various sickness funds - involving the government, the social partners and healthcare providers - proved controversial (LU0012154F). The main purpose of the meeting was to determine a balanced budget, but despite a budgetary surplus, it retained the reduced benefits and increased contributions that were decided in 1999, thereby provoking a fierce response from the trade unions, and even persuading the OGB-L to initiate a procedure leading to a general strike (see above under "Industrial action").

The new public sector pay agreement was signed by the government and the CGFP in May (see above under "Pay") was seen as highly significant for the development of public sector industrial relations. According to the Minister of Public Sector and Administrative Reform, the agreement was negotiated "in the spirit of tripartism," that is to say in a context of "respect for the other parties". CGFP stressed the favourable climate in which the negotiations had taken place, "thanks to open and constructive dialogue in which one felt that confidence was reasserting itself". This was the first agreement of this type since 1992 - according to CGFP: "after a period of incomprehension, tension and confrontation (LU9808173F), [CGFP] was able to renew a tradition - that of collective bargaining, with the finishing touches supplied by a proper collective agreement."

Outlook

There are a number of issues which are likely to be of concern in Luxembourg during 2001. Flexible working time provisions and the definition of reference periods in collective agreements are likely to feature in discussions, as the social partners were able to reach agreement on work organisation issues in 2000. A new law should on the issue should thus be finalised in 2001

The drafting of a new NAP dealing with matters related to part-time working and the European Commission's recommendations on employment policy is likely to continue during 2001.

Further, following the ALEBA case, efforts must be made to find a new definition of the criteria for the nationally representative status of trade unions (allowing them to conclude collective agreements), thus preventing the administrative courts usurping the political sphere in this area.

Finally, questions raised by the joint action of seven trade unions around a common platform for improvements to the general pension insurance scheme (LU9812183N) will need to be addressed in 2001.