Renewal of the agreement on collective bargaining in 2006

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The employers and the most representative trade unions have agreed to renew in 2006 an agreement on the bases of pay bargaining in collective agreements that they have signed every year since 2002.

The Spanish Confederation of Employers' Organizations (Confederación Española de Organizaciones Empresariales, CEOE), the Trade Union Confederation of Workers’ Commissions (Comisiones Obreras, CCOO) and the General Workers’ Confederation (Unión General de Trabajadores, UGT) have agreed to renew the agreement on collective bargaining that they have signed every year since 2002. It defines the basic criteria on pay to be negotiated in collective agreements in 2006. In order to facilitate the process, the representatives of the CEOE, CCOO and the UGT decided to extend the 2005 agreement instead of drawing up a new one as they had done in the previous years.

The agreement establishes pay rises according to three criteria: the forecast inflation rate (2%), wage guarantee clauses (to recover the purchasing power lost when the real inflation is higher than the forecast), and a variable amount linked to productivity.

The figures of the social partners on the effects of the agreement in 2005 indicate that in the first eleven months the 7.8 million workers whose work was regulated by agreement received an average rise of 2.94%, one point lower than the inflation rate, which was 3.4% in November. However, 76% of those workers had signed guarantee clauses that will allow them to obtain a pay rise proportional to inflation.

After the bargaining that led to the agreement, the representatives of the CEOE, CCOO and the UGT expressed their concern about the increase in temporary employment and the decreasing number of workers governed by collective agreements with wage guarantee clauses: 76% in 2005 compared with almost 80% in previous years. They also stated that they were pleased with the economic growth in Spain in 2005. However, they were concerned about its impact on prices, stating that the public and private sector have taken advantage of rising demand to increase their prices, which does not facilitate wage moderation.

The agreements that have been signed by the employers and the most representative trade unions every year since 2002 consider wage moderation to be the means towards progress in economic growth and job creation. CCOO and the UGT feel that though the prospects are good in these areas, the quality of the employment that is being created in Spain is insufficient, particularly because of the high temporary employment rate.

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