5% pay deal for ships' officers averts strike

On 10 February 1998 collective agreements were reached on pay for officers on Swedish ships, just in time to avert a strike which could have had considerable effects for export industries. The negotiations were complicated by Parliament's decision to abrogate the special seafarers' taxation system.

The parties in bargaining over the pay and conditions of Swedish ships' officers are the Swedish Engineers Officers' Association (Svenska Maskinbefälsförbundet, SMBF) the Swedish Ship Officers' Association (Sveriges Fartygsbefälsförening, SFBF) and the Sea Officers' Union (Föreningen Sjöbefälet), on the one hand, and the Swedish Ship Owners' Association (Sveriges Redareförening, SRF) on the other. When the 1998 talks started, the trade unions called for pay increases which would increase the employers' costs by 11% - far beyond what other unions have claimed in the 1998 bargaining round.

The reason for this unusually high claim was the Parliament's decision in December 1997 to abrogate the special seafarers' taxation scheme. This tax system favoured seafarers compared with other tax payers when they were compensated for overtime in cash instead of time off, a possibility which, in mutual understanding with the employers, is regularly utilised by the officers. The repeal of the seafarers' tax meant that net pay for some of them would decrease by several thousand SEK per month, for which they wanted compensation from the employers. The ship owners rejected their claims.

The SMBF gave notice of a strike on board 22 ships as from 6 February. The SFBF, however, thought that there was still room for constructive negotiations. The strike, which would have had considerable effects for export industries, was postponed for four days after an appeal from the mediators, and shortly before it was about to begin an agreement was reached on 10 February.

Pay for officers who are affected by the new tax rules has been increased by 5%, while the system for overtime compensation has been modified. In addition, the parties also agreed on rules for officers' aptitude tests and for competence development.

The pay claims of the Union for Service and Communication, Seafarers' Branch (SEKO Sjöfolk), which organises ships' crews, are in line with the claims of the other blue-collar unions - that is 3.5%. Due to the wage system for the crews, they are not affected in the same manner by the abrogation of the seafarers' tax scheme.