Public conciliator postpones major private sector conflict

Negotiations over a new collective agreement in Denmark's industrial sector collapsed on 22 February 1998, and a major conflict was postponed for 14 days by the public conciliator. Industrial action may break out in March, involving some 400,000 private sector employees.

On 22 February 1998, negotiations between the Confederation of Danish Industries (Dansk Industri, DI) and the Central Organisation of Industrial Employees in Denmark (Centralorganisationen af Industriansatte i Danmark, CO-industri) broke down. The DI/CO-industri bargaining unit covers some 210,000 workers in industry, or some 62% of all the employees whose collective agreements are due to be renewed by 1 March 1998. The norm-setting effect of the agreement in industry is estimated to affect agreements covering an additional 100,000 workers. As other bargaining units in the private sector await the outcome of the negotiations in the industrial sector, the breakdown in talks meant that a major conflict across the whole private sector could have broken out on 2 March 1998, the day after the current agreements expire.

On 24 February 1998, the public conciliator decided to postpone the notified conflict by 14 days. The postponement means that the conflict may be initiated on 16 March at the earliest. The trade unions' strike notice, affecting the entire area covered by the Danish Employers' Confederation (Dansk Arbejdsgiverforening, DA), and DA's notice of lock-out have been postponed until the deadline for the negotiations on 16 March 1998.

The present situation is complicated because of the particular conditions. The gap in demands between DI and CO-industri at present seem unbridgeable. DI wants the existing 1995 collective agreement to be renewed without changes (DK9801147F), saying that costs imposed by legislation and moderate wage developments abroad (DK9709127N) do not allow for any pay increase at the central level. The CO-industri trade union cartel demands a 0.9% improvement in contributions to the occupational pension scheme before negotiations on other issues can take place, in which CO-industri will include demands similar to those which can be anticipated for the other bargaining units.

As employers' federations affiliated to DA have agreed to await the outcome of the negotiations between DI and CO-industri, the industry sector is presently blocking the negotiations and likely progress which could be made in other bargaining units covered by Danish Confederation of Trade Unions (Landsorganisationen i Danmark,LO) and DA.

The general election taking place on 11 March 1998, only five days before the first postponement expires, has added to the complexity of the present situation. The social partners deplore the timing, saying that, to a certain extent, the ongoing political campaigns are to blame for the collapse in the negotiations. Both the political signals on possible new legislation after the election and speculations on government intervention in a likely conflict have further complicated the negotiations. The last time that a government intervened in a conflict was in 1985, when the right-wing Government dictated a lower increase in wages than that which had been discussed by the Public Conciliator Service (Forligsinstitutionen). Never before has a general election been called at the same time as the collective bargaining round enters a vital phase. In 1975 and 1977, elections were called close to the beginning of the bargaining process.

The public conciliator may decide to postpone the notified conflict by an additional 14 days, if the potential work stoppages and lock-out endanger "life-supporting" institutions or if the conflict has far-reaching consequences for society.