Collective bargaining in Portugal: renewal through continuity?

Source: Relatórios trimestrais, Direcção Geral das Condições de Trabalho, MTS.

There was some innovation in the contents of agreements negotiated in 1998: 36.3% covered non-pecuniary matters, while in the previous year only 15.8% had done so. Length of working time was the non-wage issue most often negotiated, featuring in 16.1% of the 328 non-pecuniary clauses analysed. The organisation of working time was also frequently mentioned (7.6%), while part-time work came up in only eight of the 328 cases. However, a closer look reveals that the degree of innovation in content is very limited, often repeating provisions already laid down by law.

Negotiations at Autoeuropa

The above figures refer to formal, institutionalised collective bargaining. However, in Portugal, bargaining can also occur within companies in an informal manner (PT9802165F), as the example of Autoeuropa shows.

Autoeuropa, one of Portugal's main firms in the motor manufacturing sector, was formed as a joint venture between Ford and Volkswagen, though Volkswagen has recently acquired the Ford part. The automobile industry carries a lot of weight in terms of the number of workers involved and of Portuguese industrial strategies, particularly acting as a stimulus for small and medium-sized companies. Much of the innovation in work organisation has come out of this industry, as well as some innovation in collective bargaining itself. There is a sectoral collective agreement that covers both automobile production and sales but an agreement negotiated informally by Autoeuropa management and the workers' commission came into effect in the company in January 1999. Autoeuropa has been negotiating informal agreements internally since 1994 but, according to the company, this year's agreement includes some new features:

1. recognition of the principle of flexibility as a fundamental modus operandi for the company's operations. Flexibility of working time was increased considerably;

2. pay increases based on performance, but differentiated in order to reduce differentials (4% for less skilled operators and 3.5% for others);

3. bonuses based on achievement of collective results (based on financial and quality-related company objectives) or individual results (based on attendance, housekeeping, quality of production, compliance with safety regulations and continuous improvement). These bonuses, similar to profit-sharing, will never amount to less than PTE 150,000 per year (2.4 times the monthly rate of the national minimum wage); and

4. extra paid holidays.

The deal was ratified by the workers' commission in a plenary session with the knowledge and acceptance of the individual trade unions concerned and both union confederations.

According to the company, such agreements have both positive and negative features:

• this type of accord tends not to go beyond the level of a non-binding understanding with no legal effect, because workers' commissions are denied the right to negotiate on pay;

• on the other hand, such agreements permit companies to negotiate important issues that may change from year to year.

• matters negotiated at the company level are dealt with more comprehensively because the workers know what is acceptable and what is convenient in their particular work situation; and

• sector-level negotiations are more difficult, especially when a sector is very large or includes branches with widely disparate activities. This makes it impossible to deal with issues that do not affect all parties. Sectoral bargaining is subject to political pressures to a greater degree than company-level bargaining. Trade-offs must be made in negotiations, making it more difficult to arrive at anything new.

Commentary

Several issues are relevant to the current bargaining situation, as outlined above, including:

• the impact of negotiations at the level of national strategic concertation. The current 1996-9 Strategic Concertation Pact (Acordo de Concertação Estratégica, ACE) (PT9808190F) and the present intense debate on labour legislation may end up diluting the impact of more traditional and institutionalised forms of bargaining, such as sector-level bargaining, although the effects may vary from one sector to another; and

• the increase in less stable forms of employment and a decrease in the unemployment rate (to 4.7%, according to national figures). Collective bargaining is directed primarily at the standard employment relationship, but obtaining and keeping a secure job is a goal that seems increasingly out of reach for the average Portuguese worker.

The main concern of the social partners, especially the unions, seems to be to deal with problematic situations in bargaining as they come up. However, these clash with the legal system, because informal company-level negotiations are being conducted where the representativeness of parties involved in the negotiation as well as the legal efficacy of the agreements are called into question. (Maria Luisa Cristovam, UAL)