Employment agreement signed in the Basque Country

Download article in original language : ES9903100FES.DOC

In January 1999 the Basque employers' association CONFEBASK and the four most representative trade unions in the Basque Country (ELA, CCOO, UGT and LAB) signed an "intersectoral agreement for employment". This agreement - which is valid for five years - pioneers a number of innovative features in regional employment pacts, such as the abolition of overtime, the replacement and recruitment of workers and the pay of temporary agency workers.

An "intersectoral agreement for employment" (Acuerdo interprofesional por el empleo) for the Basque Country was signed on 15 January 1999, following a bargaining process which proved difficult right up to the end. In 1998, there had been several rounds of discussions and proposals for shorter working hours and job creation within the Industrial Relations Council (Consejo de Relaciones Laborales) of the Basque Country between the CONFEBASK employers' association and the region's four most representative trade unions, ELA, CC.OO, UGT and LAB. In October 1999, two of the unions (ELA and LAB) had drawn up a joint proposal on shorter working hours, reductions in overtime, early retirement from the age of 60, voluntary worksharing and greater job security, in order to reopen negotiations with CONFEBASK.

The Ministry of Labour of the Basque government closely followed the bargaining process, encouraging negotiations and providing support for funding in some cases.

Main contents

The new agreement focuses on the following areas: abolition of overtime; replacement and recruitment of workers; working hours; temporary employment agencies; and service companies.

Overtime

Overtime working has been abolished, except in the following situations:

• force majeure, to prevent or remedy disasters and other extraordinary problems; and

• for unforeseeable reasons, when it is "indispensable" for the normal operation of the company.

Overtime carried out under these exceptional circumstances will be compensated by time off in lieu. For the purposes of the agreement, conditions will have to be specified through sectoral and/or company agreements, which will lay down the "organisational adjustments" and other aspects that the abolition of overtime may make necessary. The signatory organisations "urge the public administration to establish the necessary plans and the means for the monitoring of the implementation of the agreements".

Replacement and recruitment of workers

The agreement lays down the framework of conditions for lower-level agreements on the early retirement of workers and their replacement by newly recruited staff. The workers replaced will be those who qualify for the retirement pension but who have five years or less to go before retirement. Replacements will be unemployed or on temporary contracts and will be recruited on full-time permanent contracts. Terms and conditions for each new worker will be set in line with his or her occupational grade.

The conditions of replaced workers are regulated so that when they leave the company they receive unemployment benefit for the maximum period to which they are entitled. During this period, replaced workers will receive a supplement to their contributory benefit to ensure that they receive a total net income that is no less than 85% and no more than 100% of their net wage on leaving the firm. This total net income will be revised annually. Once their maximum period of benefit has expired, mechanisms will be established to guarantee the workers a total net income equivalent to the one they received up until that time.

The agreement, which will remain in force for five years, will be applied collectively and individually in each company, respecting at all times the wishes of the replaced worker. The company must inform the workers' legal representatives of any proposed replacement. A tripartite commission comprising representatives of the Basque government, employers and trade unions will be set up to approve the replacement agreements.

To make the present agreement viable, the public administration of the Basque autonomous community will finance each replacement contract and the retirement plan of the replaced workers. The signatory organisations will ask the public administration to organise the necessary courses of occupational and continuing training to achieve the skills required to fill the posts of the replaced workers.

Working hours

The positions of the employers' association and the trade unions on shorter working hours are at present "distant". The complexity of the factors involved and the desire to overcome differences has led the parties to intensify the process of dialogue. To this end, the "commission for employment" has been maintained within the Industrial Relations Council and will meet regularly to discuss this topic.

Temporary employment agencies and service companies

The agreement states that when companies contract the services of temporary employment agencies they will ensure that the workers involved will enjoy the pay conditions laid down in the appropriate sectoral agreement. Regarding service companies, the government has been asked to take measures to avoid the illegal transfer of workers.

Commentary

Both the CONFEBASK employers' association and the trade unions that signed the agreement (ELA, CC.OO, UGT and LAB) have expressed their satisfaction with the outcome. Nevertheless, the unions stress that the subject of shorter working hours has been left out.

The abolition of overtime is considered necessary owing to the high rate of unemployment and the amount of overtime that is currently carried out. In 1995, the Minister of Labour of the Basque Government estimated that 24 million hours of overtime were worked in this autonomous community. Bearing in mind the volume of overtime that is considered "unavoidable" to meet production requirements, some studies maintain that it is possible to create between 10,000 and 12,000 new jobs as a result of this measure.

The application of the agreement with respect to replacement contracts depends on the provision of funding. At the end of January 1999, the president of the Basque government, Juan José Ibarretxe_,_ ratified the allocation of funds for these contracts. It is thought that in the course of time this will make it possible to create between 10,000 and 15,000 new jobs.

CONFEBASK believes that the agreement is "very important", particularly because it involves the "re-establishment of the social dialogue". However, it must be pointed out that for the trade unions, whilst the agreement is an important first step, job creation is still the main aim, so it is considered necessary to deal with the question of shorter working hours. On this issue there is great disagreement between CONFEBASK and the unions.

In the spring of 1998, several trade unions called a stoppage of one hour to demand a 35-hour working week. By February and March 1999, the commission for employment was still inoperative and some trade unions were planning rallies in May if the employers' associations had not by then adopted a more favourable attitude towards negotiating shorter working hours. (Antón Borja, University of the Basque Country)