Towards a new start for social dialogue? Collective employment relations – Q1 2015

This article synopsises the development of European social dialogue and then discusses some ideas that might guide the European institutions and the social partners as social dialogue within in the EU is relaunched, such as more autonomy for the social partners, better links between EU and national level, and greater involvement of the social partners in the European Semester.

From the signing of the Treaty of Paris in 1951, it was more than 30 years before the next decisive step was taken to promote European Community social policy. The roots of European social dialogue date back to the 1970s when Community social partners were consulted on European-level issues on an ad-hoc basis. Social dialogue took on a more autonomous and bipartite form in the preparatory phase of the single market at the initiative of Commission President Jacques Delors. This fundamental change may be dated to 31 January 1985, when the EU-level social partners were asked to participate in a high-level meeting in the castle of Val Duchesse in Belgium. (‘Val Duchesse’ has been a synonym for European social dialogue ever since.) 

The reason for the meeting was to reaffirm the importance of the social partners in the European integration process, which had been relaunched with the implementation of the single market programme. It was President Delors' firm conviction that the single market programme had to correlate with a social dimension of the European Community; the cornerstone of this social Europe would be social dialogue. For the first time, a president of the European Commission took the responsibility to unite the leading social partners by giving them an essential role in the multilevel game of ‘Community chess’ (see, for example, Nunin, 2001; Degimbre, 1999). It proved to be the first step in what became known as the Val Duchesse period of dialogue (1985–1993), characterised by bipartite social partner activities consisting mainly of joint opinions, resolutions and declarations.

European social dialogue received formal recognition when the Single European Act inserted the new Article 118B EC into the EC Treaty (now Articles 154 and 155  of the Treaty on the Functioning of the European Union, TFEU). The dialogue moved to a second phase with a meeting held at the Palais d’Egmont on 12 January 1989. Between 1985 and 1995, the Val Duchesse process generated 21 joint opinions and declarations, 2 key agreements and 7 high-level summits. Its greatest achievement, however, was the result of the negotiations at Maastricht, which produced the Treaty on European Union of 1992. Most of the substance of the provisions was the result of negotiations between the European Trade Union Confederation (ETUC), the Union of Industrial and Employers' Confederations of Europe (UNICE) and the European Centre of Employers and Enterprises providing Public Services (CEEP), culminating in the agreement dated 31 October 1991 on a new draft of Articles 118(4), 118A and 118B of the Treaty of Rome. With few modifications, the 11 Member States adopted this agreement, known as the Agreement on Social Policy, as the basis for the future labour and social law of the EU.

With regard to agreements concluded by the EU-level social partners, the TFEU (in Article 155 (2)) distinguishes between agreements implemented by Council decision and agreements that have to be implemented in accordance with the procedures and practices specific to management and labour in the Member States, also called 'autonomous agreements'.  This governance necessitates a functioning social dialogue at European and national levels. To date, European social dialogue has delivered 8 cross-industry, 1 multisectoral and 11 sectoral agreements. Certain quarters of academia and EU actors argue that EU sectoral social dialogue, which has adopted more than 700 texts in 43 sectors over the past decades but only 11 agreements, could be rendered more efficient and effective. In total, the number of agreements signed equates to less than 2% of the texts signed in European social dialogue. The recent controversy about the 2012 hairdressing sector agreement has added fuel to this debate. The Commission has not taken any decision to date, and the social partners in the meantime have announced an initiative to revise the 2012 agreement. 

The new Commission under President Jean-Claude Juncker is committed to relaunch social dialogue, and a first step was taken with the organisation of a high-level conference, A New Start for Social Dialogue, in Brussels on 5 March 2015. The aim of the conference was to discuss concrete ways to strengthen social dialogue with EU cross-industry social partners and their national affiliates from all Member States, as well as EU sector social partner organisations. A red thread in the discussion was the need for rebuilding the capacity of the social partners at different levels; rebuilding trust between the two sides of industry seems to be a prerequisite to a new start of social dialogue. A few ideas that might guide the European institutions and the social partners to move towards a true and responsible social dialogue are discussed below.

Towards more autonomy

The principle of autonomy of the social partners is embedded in most of the legal systems of the EU, as well as in texts of international and European organisations. It has been recognised as one of the general principles of EU law according to Article 152 of the TFEU. However, recent Eurofound research has shown that one impact of the economic crisis on industrial relations was an increased trend toward unilateral decision-making by governments at the expense of the autonomy of the social partners, especially in the public sector. The autonomy of the social partners is particularly at stake when it comes to wage-setting mechanisms. The EU social partners stressed the importance of their collective bargaining autonomy, and trade union representatives, in particular, voice their concern about what they see as interference from EU institutions in national-level wage determination and wage policy. The importance of the autonomy of the social partners as an indispensable condition of a true social dialogue was also flagged up by representatives from the International Labour Organization (ILO) and the European Association of Craft, Small and Medium-sized Enterprises (UEAPME) at the Brussels conference on relaunching social dialogue. President Juncker noted at the conference that tripartism does not work without well-functioning bipartism. It is the responsibility of the social partners themselves to advance bipartism. Well-functioning bipartism is deeply rooted in the autonomy of the social partners.

Towards more subsidiarity

Society works better if citizens have the feeling that decisions concerning them are taken at the most appropriate level. The appropriate level is not only determined by territorial criteria but also by functional criteria according to the expertise required. When deciding who is to be involved in the decision-making process, horizontal subsidiarity must be taken into account along with vertical subsidiarity. This point is clearly made by Mr. Georgios Dassis, rapporteur of the recent  European Economic and Social Committee (EESC) opinion from 10 September 2014 on the Structure and organisation of social dialogue in the context of a genuine Economic and Monetary Union. When the social partners arrive at common solutions, these often have a better chance of succeeding, both because they have more support and because these solutions are often more realistic. A firmer application of the principle of subsidiarity seems to be an appropriate means to strengthen social dialogue. The importance of the principles of subsidiarity and proportionality as key dimensions of social dialogue was stressed by representatives from the ILO, BusinessEurope and Danish employers at the Brussels conference.

Towards more representativeness and legitimacy

Social dialogue between the representatives of employees and employers holds a key place in both Europe’s national employment relations systems and in EU-wide politics and governance. However, for at least half a century after the 1919 founding of the ILO there were important debates about who is ‘truly representative’ at local, national and international levels. Under European social dialogue, management and labour have developed into co-legislators in the social policy field. Therefore, the representativeness checks exercised by the Commission are very important. Eurofound has been mandated by the Commission to assess the representativeness of the European social partners since 2006 and to date has carried out 38 sectoral studies and 1 cross-industry study in order to contribute to improving the legitimacy of European social dialogue. In 2014, Eurofound carried out a representativeness study on cross-sector social dialogue. The data collected for this study show that the European social partners currently involved in cross-industry social dialogue are affiliated to the great majority of national organisations that have a role in cross-industry industrial relations in the EU28 Members States and cover about 90% of member employees and firms. Finally, it also must be made clear that social dialogue is different from civil dialogue. The European Court of Justice acknowledged in 1996 that the legitimacy of the European social partners in the EU decision-making process derived from their functional representativeness. This criterion clearly distinguishes social from civil dialogue, and this point was also made very clear by Patrick Itschert (ETUC) and President Juncker at Brussels conference of 5 March. President Juncker emphasised that the social partners have their own reservoir of functional legitimacy. It is the EESC that brings together social and civil dialogue in one European institution.

Towards better linkages between EU and national level

A crucial dimension of social dialogue is the relationship between the European social partners and their national affiliates. The future of social dialogue at EU level is above all dependent on the social partners’ capacity to increase the articulation between the EU and the national level. If European social dialogue is to operate to the full, the EU and its Member States must support not only European social dialogue itself but also the national players and structures pursuing social coordination. According to Hans-Joachim Reck (president of CEEP), the involvement of the national social partners in shaping Europe’s policymaking is a precondition for its legitimacy.

Towards more institutional support

In European social dialogue, the number and scope of policy proposals also depend on whether the Commission considers these initiatives a priority in the EU's interests. The EU's progress in the field of social dialogue is, in return, also contingent on the degree of support from the other EU institutions and Member States, and on the position of the social partners. This is why the late Professor Brian Bercusson, a leading authority on EU labour law, interpreted European social dialogue as an industrial relations process characterised by 'bargaining in the shadow of the law'.

Towards more capacity-building and more mutual trust

Social dialogue is based on arguing and mutual learning. The Val Duchesse origins of social dialogue 30 years ago created a dynamic by building up a relationship of trust between the actors by improving communication about each other's capacities and intentions and establishing a commitment to engage in negotiations at EU level. Past interviews with protagonists of EU-level interest organisations show that learning is a key factor in the process of the European social dialogue. The importance of mutual trust was strongly emphasised by Markus Beyrer, director-general of BusinessEurope, at the recent high-level conference. Thus, socialisation is an important factor in the understanding of EU social dialogue as a multilevel and multi-actor polity. In the aftermath of the 2008 economic crisis, it may be time to revisit the spirit of Val Duchesse and rebuild a relationship of trust between the two sides of industry.

Towards a better involvement of the social partners in the European Semester

A better and more timely involvement of the national and European social partners in the European Semester will enable them to strengthen the social dimension of the EU. Some of the proposals have already been put into practice. The European social partners have been consulted prior to the publication of the Annual Growth Survey (AGS), and the dialogue with the Employment Committee (EMCO) and the Social Protection Committee (SPC) has further improved. The Council on Employment, Social Policy, Health and Consumer Affairs (EPSCO) has discussed the involvement of social partners and endorsed EMCO guidelines in this respect, to be followed by the SPC. Since the 2014 Italian Presidency, the European social partners participate directly in discussions at the informal meetings of the employment and social affairs ministers. The European social partners have welcomed this recent practice and the dialogue with EMCO and the SPC as the preparatory committees for the Council. At the high-level conference on social dialogue, the ETUC proposed that the country-specific recommendations (CSRs) should also contain indicators on the quality of national social dialogue.

Towards a more efficient and fairer social market economy

The European social model, of which social dialogue is a central pillar, has been challenged in the course of the crisis. The recent attempts to strengthen the social dimension of the economic and monetary union (EMU) address some of the initial weaknesses of its design in order make it fairer, more competitive and more able to promote growth.

On the occasion of the 30th anniversary of Val Duchesse, both Vice-President Dombrovskis and Commissioner Thyssen reiterated that social dialogue was a prerequisite for the social market economy and crucial to both competitiveness and fairness. This view was echoed by other EU institutions and social partners at the Brussels conference on social dialogue:

• Pervenche Berès (Member of the European Parliament) noted that social dialogue married efficiency, social democracy and competitiveness;
• Catelene Passchier (vice-president of Federatie Nederlands Vakbeweging, FNV) said that social dialogue was a key feature of Europe;
• Bernadette Ségol (secretary-general of ETUC) mentioned that social dialogue put economic and social questions on an equal footing and fostered qualitative competitiveness;
• Peter Faross (secretary-general of UEAPME) and Markus Beyrer (director-general of BusinessEurope) highlighted that social dialogue was a core element in the market economy and that the EU and social partners should engage in a partnership of reform. 

For a new start to European social dialogue to happen, a true and responsible involvement of the social partners is needed!