No significant elections were held in Denmark in 2003. The government formed in November 2001 by the Liberal Party (Venstre) and the Conservative Party (Det Konservative Folkeparti), headed by Liberal leader Anders Fogh Rasmussen, continued in office. The next parliamentary elections will be held in 2005.
This record reviews 2003's main developments in industrial relations in Denmark.
Political developments
No significant elections were held in Denmark in 2003. The government formed in November 2001 by the Liberal Party (Venstre) and the Conservative Party (Det Konservative Folkeparti), headed by Liberal leader Anders Fogh Rasmussen, continued in office. The next parliamentary elections will be held in 2005.
Collective bargaining
Most sectors were covered in 2003 by the terms of earlier multi-year industry-level agreements - the bulk of the private sector was covered by four-year agreements concluded in 2000 (DK0002168F) and the private sector by three-year agreements signed in 2002 (DK0205102F and DK0204103F) Bargaining took place in only two private sector areas in 2003 (DK0302102F): banking and finance, and slaughterhouses and meat processing.
On 4 February, a two-year agreement was concluded between the National Insurance Workers’ Association (Danske Forsikringsfunktionærers Landsforening, DFL) and the Danish Employers’ Association for the Financial Sector (Finanssektorens Arbejdsgiverforening, FA), which covers about 10,000 employees in insurance companies. It was followed on 8 February by a similar two-year deal between the Association of Employees in the Finance Sector (Finansforbundet, FF) and FA for the 50,000 or so employees in banks, financial institutions and mortgage credit institutions.
As the Association of Employers in the Slaughterhouse Sector (Slagteriernes Arbejdsgiverforening, SA) resigned in 2002 from the Danish Confederation of Employers’ Associations in Agriculture (Sammanslutningen af Landbrugets Arbejdsgiverorganisationer, SALA) and joined the Confederation of Danish Industries (Dansk Industri, DI) (DK0208102F), bargaining in this sector took place, for the first time, between the agricultural group of Danish Food and Allied Workers’ Union (Nærings- og Nydelsesmiddelarbejder Forbundet, NNF) and DI. After lengthy negotiations, they reached a one-year deal on 9 February 2003. The one-year period was demanded by DI, so that the renewal of the agreement can be negotiated together with the industrial sector in 2004, and thus be in step with the wider DI area.
The introduction of 'individual options' was a priority demand in 2003 from the employee side in both the meat/slaughterhouse and finance sectors. This turned out to be a demand which the employers were interested in meeting, and the negotiations were concluded without any major problems. In both cases, the new agreements have thus introduced an innovative 'à la carte' model.
The agreements in finance and insurance include a so-called 'wage package' which gives the employees the possibility of deciding on the make-up of their own pay package, including a choice between using part of the wage sum for more time off or higher pay, on the basis of 'catalogues' which will drawn up in cooperation between the companies and employee representatives. There is wide scope regarding the elements that can be included in these catalogues but, importantly, occupational ('labour market') pension contributions cannot be included.
A contributory factor in reaching agreement on a 'free choice' model in the slaughterhouse sector was that the employees also obtained the possibility of including their occupational pension contributions in their option scheme - unlike the employees in the finance sector. They thus have a choice between higher wages, more leisure time or higher pension contributions, within a framework corresponding to 2.7% of the agreed wage sum. This is initially a pilot scheme which will expire at the end of 2004.
Pay
The new collective agreements in both insurance and banking provided for a total framework of a 6.2% increase in costs over two years, most of which was earmarked for wage increases - 5.9% in the insurance agreement between DFL and FA and 5.7% in the banking agreement between FF and FA. In both cases, the majority of the latter sum will be used for general wage increases - 4.0% and 4.2% respectively. In insurance, 1.9% has been reserved for local wage negotiations and in banking 1.5%. This strengthening of local-level bargaining was introduced in the previous bargaining round (DK0103116F) and has thus been continued.
The total annual framework for cost increases in the slaughterhouses/meat processing agreement was between 4.5% and 5%, depending upon whether it is the employer side or the union side that evaluated the result. In either case, this seemed to be at a level which is on the high side of what is acceptable for employers, but it was the price to pay for DI persuading NNF to conclude an agreement with a duration of only one year. This was the most important objective for the employers in the negotiations.
Working time
Collectively agreed normal weekly working time in Denmark has since 1990 stood at 37 hours. Extra time off was one of the possibilities under the 'free choice model' agreed in the sectors that bargained in 2003.
Job security
The issue of job security was not a particular focus for collective bargaining in 2003. However, agreements on further training in all sectors, and special technology allowances in the slaughterhouse sector when new technology is introduced, went hand-in-hand with attempts to safeguard jobs.
Equal opportunities and diversity issues
There were no particular developments in the area of equal opportunities in collective bargaining during 2003. In August, the Danish Confederation of Trade Unions (Landsorganisationen i Danmark, LO) and the Danish Employers' Confederation (Dansk Arbejdsgiverforening, DA) published a joint analysis of the wages of women and men (DK0309103F). It is the most comprehensive study to date of the causes of gender differences in wages in Denmark, quantifying a number of factors which have a decisive impact in this area. The study finds that the average gender wage gap (to women's disadvantage) is 14%-15% among blue-collar workers and 19%-20% among white-collar workers. DA and LO were in agreement about the study's findings, but disagreed as to what should be done in future to remedy the situation.
There is widespread consensus in Denmark that older workers should remain longer on the labour market, in order to maintain the current welfare state in future in the light of demographic change. However, reports published by the social partners in May 2003 highlight the fact that many unemployed people over the age of 50 find it very hard to obtain a new job (DK0307104F). Trade unions attribute considerable blame to employers' prejudices against older workers, while employers stress the role of early retirement and unemployment benefit provisions in low activity rates.
Training and skills development
The 2003 finance agreements contain provisions on training and competence development, based on the parties’ joint view of the importance of strengthening the competences of employees. The slaughterhouse agreement contains a declaration of intent which states that the parties will work to ensure that employees in individual enterprises are offered the necessary continued and further training. It is seen as important to develop employees’ vocational and personal qualifications, and the signatories in this sector therefore recommended that systematic planning of training initiatives be introduced in individual enterprises.
Other issues
The new agreement in the slaughterhouse sector increased occupational pension contributions to 9% of pay, which will now be the minimum contribution. However, during the lifetime of the agreement, this pension contribution may be increased through the 'individual choice' model.
In a study of the different choices made by slaughterhouse and meat processing workers under the new 'free choice' model (DK0305101N), NNF found that the majority had opted for more time off. Of 13,000 workers at the Danish Crown, Tulip and Tucan pork and beef divisions - which cover most of the employees in the sector - around 50% had chosen to use all of their 'convertible' share of the total wage bill for six additional days of leave. Higher wages alone were chosen by 37%, while only around 2% had chosen only higher pension contributions. The remaining members had chosen different combinations of these three possibilities.
Although the deal in the banking sector included an increase in the occupational pension contribution to 15% of pay - of which at least 10 percentage points is to be paid by the employer - the two sides could not reach an agreement to include the contributions as an option in the new 'à la carte' model. The position of the FF union was that the full 15% is needed to ensure an acceptable income upon retirement, and that there is no room here for a free choice.
Legislative developments
In October 2003, the Minister of Employment, Claus Hjort Frederiksen, proposed an amendment to the Act on prohibition of discrimination on the labour market of 12 June 1996 (Lov nr 459) (DK0308104T). The purpose of the proposed amendment is to implement the EU race Directive (2000/43/EC) (EU0006256F) and parts of the framework equal treatment Directive ( 2000/78/EC) (EU0010274F). The words 'or belief' are to be inserted after 'religion' in the law's text. The amendment had, as of January 2004, only passed the first reading out of three in the parliament.
Details of other significant legislative developments during 2003 are provided below the relevant thematic headings below.
The organisation and role of the social partners
In March, the Union of Telecommunication Workers (Telekommunikationsforbundet, TKF) announced that a comfortable majority of its members had voted in a ballot in favour of a merger with the larger Union of Danish Metalworkers (Dansk Metal) - both unions are affiliates of the LO confederation. Under the terms of the merger, TKF will become an independent section of Dansk Metal, with considerable independence. The vision of TKF’s leadership, in the longer term, is to establish a single organisation for the 50,000 or so information technology workers in Denmark, who are presently organised in six different unions (DK0303103F).
In October 2002, three other LO unions agreed to take the first joint step towards a merger. The proposed merger of the General Workers' Union (Specialarbejderforbundet i Danmark, SiD), the Union of Female Workers (Kvindeligt Arbejderforbund, KAD), and the Union of Wood, Industrial and Building Workers (Forbundet Træ-Industri-Byg i Danmark, TIB) would create Denmark's largest union, with about 470,000 members (DK0211105F). In August 2003, the 70,000-strong TIB left the merger negotiations, while SiD and KAD continued the cooperation plans and hope to be able to merge in January 2005, after membership ballots and a joint congress in September 2004.
An important event in the development of the organisation and the role of the trade unions was a decision to create a 'New LO'. At an extraordinary congress held in February 2003 (DK0302103F), LO adopted a new set of basic values and a new decision-making structure, aimed at creating a more flexible basis for action and signalling 'a modern main organisation'. This included an end to financial support for the Social Democratic Party (Socialdemokratiet), thus removing barriers to mergers with other union confederations. Cutting the last ties with the party was a difficult move to accept for many union leaders outside the LO executive, who did not want to leave the partnership and thus weaken the position of both organisations. Another important point on the agenda of the congress was to find a solution to long-running demarcation disputes among the member unions. A new conflict-solving structure was adopted. However, LO did not completely succeed in finding a solution to the problem and there remained divergences between affiliates at the end of the congress. Some commentators believed that the solidarity of the union movement suffered a small, but notable defeat at the congress.
At its ordinary congress in October 2003, LO adopted a new policy on EU-level industrial relations, calling for general rules for European collective agreements and a European dispute-settlement system (DK0311101N). The policy was the subject of considerable debate and was not agreed by all member unions.
Cooperation between LO and the Danish Employers’ Confederation (DA) in 2003 produced various results. A long-promised analysis of the gender-based wage gap was published in August (see above under 'Equal opportunities and diversity issues'), while in November, in connection with the forthcoming collective bargaining round in early 2004, DA and LO renewed the so-called 'climate agreement', which dated from 2000 (DK9910150F). The new climate agreement for 2004's collective bargaining round is mainly a repetition of the former accord (DK0312102F). The negotiations are to be left to the bargaining organisations at sector level, and official title of the accord reflects this: 'Agreement concerning the framework for the organisation of decentralised negotiations on the renewal of collective agreements'. The agreement adheres to the previously-formulated 'rules of the game' concerning matters such as termination of agreements, and notice and timing in connection with industrial action. These rules aim to promote compromise and reduce the risk of industrial action.
In mid-November, all the trade unions represented in the Health Cartel (Sundhedskartellet) in the municipal/county sector - with the exception of the social workers' union - decided to leave the Association of Local Government Employees' Organisations (Kommunale Tjenestemænd og Overenskomstansatte, KTO) at the expiry of present collective agreements in 2005 (DK0312101N). KTO represents unions in the municipal/county sector (DK0111128F), the largest bargaining unit in the public sector, and has hitherto negotiated agreements for about 650,000 employees. The decision of the Health Cartel unions to leave KTO will mean a break-up of this bargaining unit.
Industrial action
There are no statistics on industrial action yet available for 2003. However, the table below shows the total number of days lost to industrial action in 2000, 2001 and 2002.
| 2000 | 124,800 |
| 2001 | 59,500 |
| 2002 | 193,600 |
Statistics Denmark, Statistiske Efterretninger 2003:18, 7 May 2003.
According to an analysis published by DA in March 2003, there was a considerable increase in politically-motivated unofficial strikes in 2002 (DK0303102F). Overall, 71,000 working days were lost as a result of unofficial strikes, according to the employers' confederation. This was twice the number of working days lost through such action in 2001, though this was the most peaceful year on the labour market for 20 years .
Significant industrial action during 2003 included a month-long nationwide strike by employees at the State Car Inspection Service (Statens Bilinspektion, SBI) (DK0303101N). The strike was caused by the management’s plan to make hundreds of employees redundant as a consequence of government cutbacks. Work was resumed after negotiations opened between trade unions and management, which resulted in agreement to spread an unspecified number of jobs losses over four years. The Faroe Islands (a self-governing territory under Danish sovereignty) were hit by major strikes in May after the breakdown of bargaining over a new collective agreement between five trade union associations and the Federation of Faroese Employers (Færøernes Arbejdsgiverforening). At the third attempt, and after four weeks of strikes, the bargaining parties concluded a pay agreement in early June (DK0306101N).
Employee participation
No significant developments took place in the area of employee participation (DK0309102T) during 2003. However, the government has included the implementation of the employee involvement Directive (2001/86/EC) linked to the European Company Statute (ECS) (EU0206202F) in its legislative programme for 2004. According to the Minister of Employment’s proposals, employees in European Companies should share the same representation rights as employees in national companies. LO fears that the influence of unions will be affected if the proposal is adopted. There were no significant developments in connection with European Works Councils during 2003.
Stress at work
Stress at work and the 'psycho-social' working environment has a high priority in the work of cooperation committees (works council-type bodies) in companies. However, although this subject has been brought up from time to time by trade unions, it was not a special topic for collective bargaining in 2003. Nevertheless, an important legislative step was taken in June 2003 by the government after talks with the social partners. An amendment to the Act on the Working Environment leaves a substantial number of issues to be regulated by the social partners, which is a new element in the regulation of the working environment. The 'softer' areas, such as bullying, sexual harassment and stress, are now to be regulated by collective agreements and in the case of a dispute, the matter is to be resolved within the industrial conciliation system instead of by the Labour Inspectorate.
Undeclared work
In the early summer of 2003, parliament (the Folketing) unanimously decided to strengthen measures to combat undeclared work, and the national police was asked to draw up an action plan. Innovatively, the police's plan involved a wide range of different authorities, along with the social partners, in a cooperative effort to combat crime in this area. Over the summer, public authorities such as the police, the public prosecutor, the Immigration Service (Udlændingestyrelsen), the Customs and Tax Authority (Told & Skat) and the Public Employment Service (Arbejdsformidlingen, AF) met representatives of trade unions and employers’ organisations to discuss possible initiatives in this field. The result was the creation of regional networks, with the local branches of trade unions playing a major role in the detection of illegal workers at workplaces, and employers’ organisations helping in particular to identify the ringleaders who organise the illegal workers and the employers that hire them (DK0308101N). A survey dating from September 2002, conducted by the trade union cartel in building and construction (Bygge-, Anlægs- og Trækartellet, BAT-kartellet), found that around 6,500 people were working illegally in building and construction, agriculture, forestry and gardening. Some 87% of the illegal workers came from Poland, Lithuania and Latvia. Exact statistics concerning undeclared work in cleaning, restaurants and hotels are not available, but they are agreed to be relatively high
In summer 2003, the Danish Union of Wood, Industrial and Building Workers (TIB) announced plans to set up an affiliated organisation which will offer membership to self-employed people in the construction sector (DK0308102F). This initiative was targeted at people working as self-employed under questionable circumstances, usually receiving lower pay than set by collective agreements. The issue of increasing 'bogus' self-employment is also seen as a problem by the main building industry employers’ organisation, the Danish Building Industry (Dansk Byggeri). Out of the 11,000 sole operators in building and construction, only half are considered to be genuinely self-employed by both trade unions and employers.
In December 2003, the government secured support for a political agreement which will permit people from the new EU Member States in central and eastern Europe to seek and take up work in Denmark from the first day of these countries’ EU membership in May 2004 (DK0312103F). However, according to the agreement, a number of laws will be amended in order to avoid abuse of social security benefits, and the new workers must have a full-time job covered by a Danish collective agreement in order to receive a residence permit. The main aim of the latter rule is to prevent new EU citizens from taking up undeclared work. The social partners welcomed the agreement.
New forms of work
The use of temporary agency workers in Denmark has been steadily increasing for a number of years. In 1992, there were 73 registered temporary work agencies with about 3,000 agency workers, a figure which grew to 396 agencies with 21,000 employees by 1999 (according to figures from Statistics Denmark). If the growth rate recorded since 1997 has continued, there were probably about 370 agencies with about 35,000 workers by December 2002. In 2001, the agencies’ turnover was more than DKK 3 billion - a 10-fold increase over a decade. The trade unions did not previously devote particular attention to the question, but given the increase in the use of temporary agency work, and the current draft EU Directive on the issue (EU0204205F), they are developing a policy towards agency work, especially with regard to when agency workers should have the same rights as user company employees on open-ended contracts (DK0212103F).
An arbitration reward issued in September 2003 thus received a lot of interest from the partners. The implication of the arbitration award - in a case involving the Union of Danish Electricians (Dansk El-Forbund) and Tekniq, the employers’ organisation for heating and plumbing engineering and electrical installation - was that temporary agency workers should work under the same contractual terms as those that apply to user company employees who perform the same work, including the same wages (DK0309101N). The arbitrator in the case ruled that temporary agency workers are covered by the collective agreement applying to the user company because they are clearly working under the management and instructions of the employer of the permanent staff. The arbitrator found that it was irrelevant whether the temporary work agency which formally employed the temporary workers was covered by a collective agreement or not.
In March 2003, the International Labour Organisation (ILO) stated that the Danish government’s 2002 part-time work legislation (DK0206102N), which intervenes in provisions on this issue in collective agreements, was in violation of ILO Conventions. The ILO Committee on Freedom of Association recommended that the government should resume consultations with the social partners (DK0304101N). The Minister for Employment stated that he was prepared to follow the recommendation.
Other relevant developments
In November 2003, the government withdrew a proposal to restrict entitlement to unemployment benefits, which had met with strong criticism from opposition political parties and the social partners (DK0311104F). Despite amendments to the plan, it had still been rejected by opponents, with the LO trade union confederation and DA employers’ organisation united in their opposition. The rules on unemployment benefits thus remained unaltered and the whole issue was shelved for the foreseeable future. The government's proposal appeared to be widely seen by the general public as a clear 'breach of promise', as the governing parties had, during the campaign prior to their victory in the 2001 general election, promised not to reduce unemployment benefits. The whole affair created a climate of insecurity and led to problems in relation to the prelude to the 2004 collective bargaining during autumn 2003, when the social partners discussed the content and form of their demands (DK0312102F).
Outlook
The key development in 2004, from an industrial relations point of view, will be the renewal in the first months of the year of the collective agreements in the part of the private labour market covered by LO and DA. The existing agreements date from 2000, covering approximately 650,000 employees in industry, trade, transport and services, and the building industry. Second, the 'New LO' will celebrate its first anniversary and some conclusions may be drawn up on this occasion by union leaders and industrial relations researchers. Third, the opening of the borders to workers from the new EU Member States from 1 May 2004 will be of major interest. Initially, interest will centre on how many of these workers will come to find work in Denmark. Attention will then be focused on how flexible the political agreement controlling the entrance of foreign workers to Denmark will show itself to be. 2004 will be no different from previous years in that there is a need for new labour in order to preserve the demographic balance on the Danish labour market. (Carsten Jørgensen, FAOS)
Eurofound doporučuje citovat tuto publikaci následujícím způsobem.
Eurofound (2004), 2003 Annual Review for Denmark, article.
