Trade unions reach joint position on reform of bargaining system

Italy’s three main trade union confederations have signed a joint document setting out guidelines for reforming the country’s collective bargaining system. Talks were set to begin with the employer organisations in the subsequent weeks, with both parties declaring that they wanted to reach rapid agreement. However, as the positions of the two sides seem rather polarised in relation to certain issues, the negotiations are not expected to be easy.

Background

The reform of Italy’s industrial relations system has been a central issue in the national debate on the competitiveness of the country’s economy for a number of years. Such concerns have grown and the need to reform the agreement of 23 July 1993 – which laid down the rules currently regulating Italy’s collective bargaining system – has become increasingly evident.

In July 2004, the employer organisation the Confederation of Italian Industry (Confederazione Generale dell’Industria Italiana, Confindustria) proposed that talks commence on this issue; however, the trade unions insisted that they would only begin dialogue when they had reached a united position, setting up a special committee to that end (IT0408106N, IT0412306F). The following year, in September 2005, Confindustria issued a document putting forward proposals for reform (IT0508206F). Nevertheless, discussions among the trade unions proved long and difficult, and it was not until 12 May 2008 that the secretariats of the General Confederation of Italian Workers (Confederazione Generale Italiana del Lavoro, Cigl), the Italian Confederation of Workers’ Trade Unions (Confederazione Italiana Sindacati Lavoratori, Cisl) and the Union of Italian Workers (Unione Italiana del Lavoro, Uil) signed a joint document of agreement.

Proposals of document

The joint trade union document – entitled ‘Reform of the bargaining structure’ (Linee di riforma della struttura della contrattazione (41Kb PDF)) – centres on improvements in wage levels, safety, working conditions, and the quality, competitiveness and productivity of enterprises. In particular, it envisages:

  • two complementary bargaining levels – at sectoral and company or territorial level;
  • sectoral-level bargaining providing for a national industry-wide agreement (contratto collettivo nazionale del settore, CCNL) – this should define the regulatory framework of the sector and the competencies to be allocated to the second level, which can be at company or territorial level; the purpose of sectoral-level bargaining is to increase the room for manoeuvre for bargaining on economic and normative matters at the company or territorial level.

National agreement

According to the joint document, the CCNL must support and enhance the purchasing power of all workers, define national and general rules, and regulate the industrial relations system at sectoral, company or territorial level. The national agreement may also stipulate that second-level wage bargaining begins at a level fixed by the CCNL.

The public sector should adopt rules corresponding to those in the private sector, also in regard to second-level bargaining.

The trade union document further states that the number of existing CCNLs – which amounts to about 400 such agreements – should be reduced through their consolidation within homogeneous areas or sectors.

As regards the economic part of the agreement, the trade unions maintain that the ‘forecast rate of inflation’ – that is, the rate anticipated by the national budget report (Documento di programmazione economico-finanziaria, DPEF) – is unreliable. They maintain that it should refer instead to the ‘realistically predictable inflation rate’, using indicators such as the European Harmonised Consumer Price Index adjusted for the weight of mortgages, and foreseeing certain recovery mechanisms in the case of inflationary differentials.

The trade unions also want the duration of national agreements to be extended from two to three years, and negotiations on their renewal to begin six months before their expiry.

Decentralised bargaining

According to the trade unions, the spread of second-level bargaining must be supported by reinforcing the instruments envisaged by the agreement of 23 July 2007 (IT0712029I) – which include fully pensionable contributions – with additional tax relief.

Moreover, second-level bargaining should be properly adapted for its purpose; the CCNLs must anticipate, as an alternative, the company or territorial (for example, regional, provincial or district) level.

The joint document also stipulates that second-level wage bargaining should centre on performance-related pay linked with productivity, quality, profitability and effectiveness. This entails better quality information for workers and their closer consultation, particularly in relation to corporate strategies and financial situations.

Democracy and representation

The trade union document includes a section on the rules concerning workplace representation. It confirms the regulations in force for the public sector, and identifies the National Council for Economic Affairs and Labour (Consiglio Nazionale dell’Economia e del Lavoro, CNEL) as the institution which, through specific committees of experts, certifies the representation and representativeness of trade union organisations.

As regards the rules on trade union democracy, in the case of confederal agreements with general validity, the document confirms the procedures for approval of the agreement of July 2007 (IT0710029I): this provides for the certified consultation of all workers and pensioners before approval by the trade union directorates.

Reactions to trade union position

The trade union joint proposals have been praised by all of its signatories. The General Secretary of Cgil, Guglielmo Epifani, emphasised ‘the great importance of the proposal, whose objective is to have a bargaining system able to increase the wages of dependent workers, which are too low in Italy’. At the same time, the General Secretary of Cisl, Raffaele Bonanni, referred to the document as a ‘historic agreement’ and called for the immediate commencement of talks with Confindustria.

On the employers’ side, the newly-elected President of Confindustria (IT0804029I), Emma Marcegaglia, has reacted positively to the trade unions’ joint position, declaring that she is ready to sit down at the negotiating table as soon as possible. However, she added that the negotiations will be ‘serious, inflexible and tough, because we cannot accept conditions which reprise the sliding scale mechanism and take us out of Europe’.

Meanwhile, the new Minister of Labour, Health and Social Policy, Maurizio Sacconi, praised the agreement as ‘a step forward in the necessary renegotiation of bargaining levels by the social actors’.

Commentary

The joint position reached by the trade unions marks a decisive step for the future of collective bargaining in Italy. On the basis of the trade union document, negotiations with Confindustria were set to begin in the month of June – as confirmed by the positions expressed in the 2005 document – with the aim of reaching an agreement in the subsequent months on the reform of the current bargaining system.

However, although cited as a ‘priority’ on the agendas of both parties, the negotiations are set to raise some critical aspects, which are likely to cause divisions between the trade union and employer sides. Two particularly contentious issues are the mechanisms for restoring the purchasing power of wages, and the possibility of resorting to the decentralised territorial level as an alternative to company-level bargaining. The latter is a proposal being promoted by the trade unions as a way to guarantee coverage of the second-level bargaining in enterprises without company-level bargaining; however, it has been strongly opposed by the employers, who fear that they may have to deal with a third level of bargaining. Given these divisions, it is difficult to predict the outcome of the negotiations in terms of timescale and content.

Edoardo Della Torre, Ires Lombardia

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