First sectoral social agreement concluded

The Sectoral Social Agreement for 2007–2009 in the construction sector was signed at the end of December 2006. Construction has thus become the first sector in the Romanian economy in which the representative social partners have concluded a social agreement.

Signatory parties

The Sectoral Social Agreement for 2007–2009 in the construction sector was signed on 27 December 2006 under the auspices of the Builders’ Social Fund (Casa Sociala a Constructorilor, CSC).

The initiators of the agreement are the nationally representative social partners for the construction sector and signatories of the sectoral collective agreements. The Romanian Association of Employers in Construction (Asociatia Româna a Antreprenorilor din Constructii, ARACO) signed the pact on behalf of employers; on the trade union side, the signatories included the Anghel Saligny National Trade Union Federation in Construction-Assembly (Federatia Nationala a Sindicatelor din Constructii-Montaj Anghel Saligny, FNSCM Anghel Saligny) and the FAMILIA General Federation of Trade Unions (Federatia Generala a Sindicatelor FAMILIA, FGS FAMILIA).

The construction industry thus represents the first sector in the Romanian economy in which the social partners have concluded a social agreement. The pact is currently awaiting publication in the Official Gazette.

Content of agreement

The agreement presents a report on past achievements and outlines the joint courses of action of the social partners for the period 2007–2009. The chapters of the agreement pertain to social partnership in the construction sector, European integration, the construction market and facilitating trade relations, work relations and sectoral self-regulation.

Social partnership

The agreement defines social partnership as ‘an ensemble of industrial relations and shared management between civil society organised groups’. According to the signatory parties, civil society includes three major components: employer organisations, trade unions and non-governmental organisations (NGOs) representing various interests of civil society, such as the liberal professions, farming, consumer protection or environmental protection.

Social partnership as enshrined in the agreement is based on a four-dimensional structure of relations:

  • consultation, ensuring an exchange of ideas, opinions and issues;
  • social dialogue, as a means whereby the three parties seek to reach consensus in areas with as yet unharmonised practices;
  • mediation and arbitration, by means of which the parties agree to reach an acceptable solution to stalled negotiations;
  • concerted social action, through which the social partners – together or separately – seek to find a joint solution with representatives of the various authorities.

European integration

According to the opinion of the signatory parties, the concerted action of the social partners in the context of the European construction market will be based on the following measures:

  • promotion of an integrated and coherent regulatory framework, in compliance with the acquis communautaire (EU body of law);
  • recognition and acceptance of the principles of sustainable development in the construction sector;
  • compilation of a study, coordinated by a specialised company or consortium of companies responsible for monitoring and evaluating the impact of Romania’s accession to the European Union on construction companies and workers in the sector.

Facilitating trade relations

The social partners propose measures intended to facilitate trade relations in the domestic construction market, by promoting regulation in the following areas:

  • the fiscal system, with an emphasis on the rate of value added tax (VAT) on special social construction projects and essential food items;
  • facilitating unimpeded financial relations;
  • drawing up forecasts on the probable development of public and private investment in the sector.

One important element included in this chapter is that of wage policies and the relation between work productivity, wages and the cost of living.

An addendum to the sectoral collective work agreement estimates that the level of the gross minimum monthly wage will reach RON 500 (€148 as at 19 February 2007) in the fourth quarter of 2007, RON 700 (€207) in 2008 and RON 900 (€266) in 2009, compared with RON 450 (€133) as of 1 January 2007. The signatory social partners highlight the necessity of wage increases in the construction sector to reach the levels of the average wage in Hungary and Poland over the following two years.

In order to eliminate certain current practices of employers, namely maintaining low wages in the competition-based race for winning tenders, it is necessary to amend the Law on public acquisitions and introduce a compulsory minimum threshold for the hourly fee for construction work. This sum will correlate with the minimum wage set by social partners in the sectoral collective work agreement.

Work relations and sectoral self-regulation

As the only private social protection operator in Romania, CSC was the first institution to be established in the system of sectoral self-regulation in the construction sector. It was set up in 1997 as an autonomous, non-profit organisation with distinct assets, managed on a bipartite basis, through the equal and free participation of trade union and employer organisations in the construction and building materials sector.

By joint decision, the social partners have agreed to let this institution function as the Secretariat of the entire System of Sectoral Self-regulation in Construction (Sistem de Autoreglementari Sectoriale în Constructii, SASEC). SASEC is organised on the basis of bipartite management, social partnership, self-determination and self-administration.

Commentary

The new SASEC body promotes innovative ideas and encompasses institutions with new responsibilities in the sector, namely the:

  • Vocational Institute of Builders (Casa de Meserii a Constructorilor, CMC);
  • Builders’ Sectoral Vocational Training Board (Comitetul Sectorial pentru Formare Profesionala în Constructii, CSFPC);
  • Builders’ Fund for Health and Safety at Work (Casa pentru Siguranta în Mediul de Munca a Constructorilor, Casimmco);
  • Builders’ Holidays Fund (Casa de Concedii a Constructorilor, 3C);
  • Joint Committee for Migrant Workers (Comitetul Paritar pentru Muncitori Migranti, CPMM);
  • Joint Committee for Combating Undeclared Work (Comitetul Paritar pentru Combaterea Muncii Neînregistrate, CPCMN);
  • Joint Committee for Transnational Companies (Comitetul Paritar pentru Transnationale, CPT);
  • Builders’ Pensions Fund (Casa de Pensii a Constructorilor, CPC).

As these associations and committees are set up by the social partners, it is likely that they will help to resolve current and future issues concerning collective industrial relations in the construction sector.

Constantin Ciutacu, Institute of National Economy, Romanian Academy

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