Unions table joint claims in banking and insurance sectors

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In a display of new-found unity, in October 2001 the three representative trade unions in the Luxembourg banking and insurance sectors made a joint claim for bargaining over new collective agreements. The demanded a large pay rise and abolition of the system of payment based on performance criteria.

The banking industry is the sector of the Luxembourg economy which has experienced the most debate and controversy over the identity of representative trade unions and the conclusion of collective agreements by such unions (only 'representative' unions have certain collective bargaining and other rights - LU9810172F).

In 1993, a collective agreement was signed for banking only by two trade unions - the Luxembourg Confederation of Christian Trade Unions (Lëtzebuerger Chrëschtleche Gewerkschafts-Bond, LCGB). and the Federation of Private Sector White-Collar Employees-Independent Workers' Federation (Fédération des employés privés-Fédération indépendante des travailleurs, FEP-FIT) - that enjoyed nationally representative status at the time, but were minority organisations in the banking sector.

The Luxembourg Association of Bank Staff (Association luxembourgeoise des employés de banque, ALEBA), which represents the great majority of bank employees but did not have nationally representative status at this time, contested the legal validity of the 1993 collective agreement, and indeed brought the matter to the attention of the administrative courts (the Council of State, Conseil d'Etat). However, the courts never examined the case in detail, saying that case was inadmissible. The 1993 agreement was also strongly disputed by the non-signatory unions - ALEBA and the Luxembourg Confederation of Independent Trade Unions (Onofhängege Gewerkschafts-Bond Lëtzebuerg, OGB-L) - on the grounds that it introduced a new payment system based on new 'groups of duties and performance criteria'.

In 1997, the three trade unions considered representative at the time - LCGB, OGB-L and FEP-FIT - with the support of ALEBA, signed a new three-year collective agreement that specifically retained the 'performance-linked' pay system (LU9706113N).

In April 1999, on the expiry of the 1997 agreement, ALEBA signed a new collective agreement for white-collar banking staff with the Luxembourg Association of Banks and Bankers (Association des banques et banquiers du Luxembourg, ABBL) (LU9905104F). The representative unions did not sign. By a Ministerial Decree of 1 December 1999, the Minister of Labour blocked registration of this collective agreement, thereby denying ALEBA nationally representative status (LU9912117N).

When ALEBA appealed, the Administrative Tribunal (Tribunal administratif) decided on 24 October 2000 that the union met the criteria set out in the law to be deemed nationally representative (LU0011152F). This decision was confirmed on appeal to the Administrative Court (Cour administrative).

Joint trade union demands

Despite this background of division, on 2 October 2001, ALEBA, OGB-L and LCGB tabled a single list of demands for the renewal of the collective agreements in the banking sector, and also in the linked insurance sector. Their designated spokesperson, the president of ALEBA, stressed the solidarity that existed between three unions, which wanted to work together in their members' interests.

The unions suggested to ABBL and the Association of Insurance Companies (Association des compagnies d'assurance, ACA) that the new agreements should last for three years. They also claimed that working time in Luxembourg is longer than in other countries, and called for annual working time to be reduced by 32 hours. Another new element in the unions' claims involved the introduction of 'long-term accounts' whereby staff can save additional hours for use in more flexible working time models.

The unions are also asking for the abolition of the performance-related pay system, because: performance can never be satisfactorily defined, and only leads to favouritism; and pay based on performance criteria has not been favourable to the internal working environment in banks. Instead, the unions propose new salary scales that will give employees longer-term pay rises. According to the unions, the introduction of new pay structures should be an additional tool with which to recruit new staff in the finance sector. The union's pay claims include salary rises of 4% a year, a new end-of-summer-holiday bonus, and an improved June bonus.

The unions have stated that they do not expect the employers to agree to their demands, because they will cite the unfavourable economic climate. In this context, the unions point out that the Finance Sector Supervisory Commission (Commission de surveillance du secteur financier, CSSF) published spectacular figures on growth in the Luxembourg financial market in June 2001: during 2000, total balance sheets rose by 8.17%, gross profits before allocations by 20% and net profits by 27%.

Employers' positions

The president of the ABBL described the trade union demands as 'disproportionate and unrealistic', and said that they would represent an increase in costs of about 30% over three years. If combined with the other demands, the pay rise of 4% would lead to a 14% increase in staff costs in the first year. The employers' representative also stated that he wanted to maintain a pay system based on performance criteria.

In addition, the ABBL president stated that, in the present circumstances, he did not think there was any chance of achieving a result in bargaining, given union demands that he claimed were designed to end in failure from the moment they were formulated. Lastly, he wondered how OGB-L and LCGB, which are represented in all sectors of the economy, would manage to explain their demands to their other members, particularly in view of the fact that the banking sector already pays the best salaries in Luxembourg.

Commentary

It seems sensible for the three representative trade unions to draw up joint demands following resolution of the ALEBA's problem over its national representative status. If the figures put forward by the employers are correct, the pay claims are effectively average for wage demands over the last few years. Although banking turnover rose appreciably during 2000, the employers will unquestionably insist on the changed situation that has applied since the terrorist attacks in the USA on 11 September 2001.

The current trade union united front will have to demonstrate its solidarity in forthcoming bargaining meetings which will, as usual, end up before the National Conciliation Office (Office National de Conciliation). (Marc Feyereisen)