1998 Annual Review for Belgium

This record reviews 1998's main developments in industrial relations in Belgium

Introduction

The increase in Belgian GDP was lower than anticipated in 1998 and is likely to average 2.2%. It is also now assumed that a forecast of 2.6% growth in 1999 is too optimistic. The budget deficit decreased from 1.9% of GDP in 1997 to 1.5% in 1998, and a further decline is forecast for 1999. Unemployment stood at an average of 12.6%, with jobless rates consistently higher in Wallonia and Brussels than in Flanders. This constitutes a reduction from the previous year and a further improvement is envisaged for 1999. The rate of inflation remained low at about 1% and is set to decline further. Wage increases were moderate, and are expected to remain so, under the influence of the "wage norm" (see below).

The government coalition of socialist and christian democrat parties remained unchanged in 1998, despite tensions being evident between the partners, particularly at community level. This may be significant in relation to the impending general, regional and European Parliament elections in June 1999. Conflicts of authority between federal bodies and the federal government are multiplying. The Prime Minister's main aim is to keep the current government in office until the elections, whatever happens.

Key trends in collective bargaining and industrial action

A number of important intersectoral collective agreements on specific issues were signed in 1998, including a National Labour Council (Conseil National du Travail/National Arbeidsraad, CNT/NAR) collective agreement on the euro single currency (BE9812159N) and an agreement on the inclusion of voluntary sector representatives in the bipartite Central Economic Council (Conseil Central de l'Economie/Centrale Raad voor het Bedrijfsleven, CCE/CRB) (BE9807149N).

In 1998, pay increases were still governed by the "wage norm" of 6.1% for 1997-8, including indexation and pay scale increases, set by the government after the social partners failed to reach an intersectoral agreement for this period. In 1998, the actual rise remained under 1.5%. However, a number of sectors with a high demand for labour exceeded the authorised margin - an example was the chemicals industry

For 1999-2000, the social partners within the CCE/CRB agreed in 1998 that the maximum level of pay increase over the two-year period should be 5.9%. This formed the basis for the pay provisions of an intersectoral collective agreement for 1999-2000 which was concluded in November (BE9811252F) without serious and far-reaching intervention by the government. The agreement also contained provisions on matters such as reductions in employers' social security contributions (in return for job-creation activities), training, working time reductions and union representation in SMEs, and occupational classification.

At sectoral level, 1998 saw the implementation of the two-year agreements signed in 1997, which stressed the development of flexibility and the reduction of working time.

At company level, the main concern among employees remained job retention and creation. This was particularly true in the industrial sector, in the light of events such as the closure of Levi Strauss Belgium (BE9810250F), and the takeover of Cockerill-Sambre by the French company, Usinor (BE9812158N).

Collective bargaining in general focused on the following issues:

• the reduction of working time. Within companies, this demand was generally made with a view to protecting jobs. However, it was not without problems - for example, problems surrounding working time cuts at Uniroyal highlighted a lack of legal clarity in this area (BE9806145F). Government-backed initiatives - such as the "Vande Lanotte plan", which provides cuts in employers' social security contributions for firms in difficulty or restructuring, that create or save jobs through agreed working time reductions - met with limited success;

• the provision of minimum social assistance. The problems relating to the transfer from unemployment benefits to social assistance were added to the bargaining agenda, largely as a result of the increasing importance of the unemployed workers' movement, which is backed by the trade unions (BE9804140F); and

• employment. 1998 saw the continuation of the policies agreed in 1997 involving the reduction of labour costs, the redistribution and sharing of work, flexible working and measures for socially excluded groups.

Notable strikes in 1998 involved various companies in the automobile industry (BE9808241N), prison officers (BE9802133N), Uniroyal (see above) and cash transport security guards (BE9802132F)

Industrial relations, employment creation and work organisation

The debate in this area was dominated by negotiations on the Nation Action Plan (NAP) for employment, in response to the EU Employment Guidelines ( BE9804141N). The Belgian NAP has as its central aims the improvement of vocational integration and thus the achievement of increased "employability". According to an agreement on cooperation between the state and the regional bodies responsible for employment, training and employment services, unemployed people will increasingly be involved in training programmes and other measures aimed at improving employability and "adaptability" (BE9810249F). The 1999-2000 intersectoral agreement also emphasises the importance of training and allows sectors to allocate a higher percentage of the paybill to vocational training.

Another government policy objective is the lowering of labour costs. A number of employment measures and programmes provide for reductions in employers' social security contributions. The question of a reduction or exemption from contributions for employers has produced a debate between trade unions and employers. The debate has focused on the questions of how to put social security funding on a sound footing and organise alternative financing, and how to ensure job creation in exchange for cuts in contributions.

Increasing emphasis is being placed on job creation, especially in the service sector. This has included schemes such as: "local employment agencies" (Agences locales pour l'Emploi/Plaatselijke werkgelegenheidsagentschappen, ALE s/PWA s), bodies attached to local authorities offering jobs for a few hours a week in private homes or local associations, which entitle unemployed people to earn additional sums on top of their benefits; and "Smet jobs", which offers part-time work in firms or associations, with pay made up of unemployment benefits and an additional contribution from the employer. However, a number of these initiatives, which are based on work for benefits, have been strongly criticised by the trade unions, particularly those representing voluntary sector workers (BE9807148F).

In order to encourage company adaptability, the government has been introducing measures to develop flexibility through worksharing. The aim is to achieve a better redistribution of work and to allow for a better reconciliation of work and family life. The latter is to be achieved through improved provision for parental leave, career breaks and more flexible working time arrangements. Plans have been adopted by companies, offering a range of work redistribution measures, including easier access to part-time work. In relation to equal opportunities policy, the social partners have committed themselves to reviewing potentially discriminatory occupational classification systems. The social partners have also recommended that increasing emphasis be placed on the development of jobs for the care of children and older people.

In Flanders, the regional government has allocated a sizeable budget for labour market policy measures. The main aim is to encourage a lowering of labour costs and work redistribution policies. New jobs have been created in the social sector and several specific training programmes have been set up. The Flemish employment plan emphasises employability and the transition from passive to active measures (BE9803230N). This plan has been adopted by the social partners.

In the Walloon region, no formal agreement on the regional employment plan was concluded by the social partners, although they did agree on the main elements of the plan (BE9803135F). Employment policy is linked to economic development policies. The plan is aimed at training and the collective redistribution of work, and seeks to back local economic initiatives by complementing traditional industries.

In the Brussels region, emphasis is being placed on vocational training and the development of company-level training and the development of community jobs. The Brussels employment plan also emphasises equal opportunities in employment and non-discrimination in recruitment (BE9803136N).

Flexibility in working time organisation and in employment contracts is increasingly prevalent in Belgium, especially when seen in a longer-term perspective. The 1998 annual evaluation report on Belgian employment policy ("Federal employment policy. Evaluation report 1998", M Jadot, Federal Ministry of Employment and Labour, Brussels, November 1998) (BE9812254F) found that the number of part-time workers had doubled since 1983 (now forming 17% of the working active population) and that the number of temporary workers had increased by 25% between 1990 and 1997.

It is significant that changes in working time and contract flexibility are often part of sectoral or company-level negotiations triggered by reorganisations in specific companies or sectors. The goal is often to reduce the number of direct or "uncushioned" redundancies. Examples during 1998 included Opel Belgium (BE9803229F), Ford Genk (BE9809244N), Monsanto Antwerpen, L'Oréal and Excel Logistics. The major BACOB bank also reached an agreement on a voluntary work schedule of four nine-hour days. More than half of the employees signed up for this option.

For the moment, collective reductions of working time remain on the agenda of union representatives in the 1999 sectoral bargaining round which will implement the 1999-2000 intersectoral collective agreement. Working time reductions to 32 hours a week without loss of pay are explicitly among the demands of the Belgian General Federation of Labour (Fédération Générale du Travail de Belgique/Algemeen Belgisch Vakverbond, FGTB/ABVV) and the union for white-collar workers affiliated to the Confederation of Christian Trade Unions (Confédération des Syndicats Chrétiens/Algemeen Christelijk Vakverbond, CSC/ACV).

Flexibility in the form of time off in order to take care of children or other family care responsibilities is increasingly supported by the government via a scheme providing individual payments: each month this results in about 1,000 requests for such time off.

Developments in representation and role of the social partners

The two largest Belgian union confederations - the socialist ABVV/FGTB and the christian ACV/CSC - saw significant organisational changes in 1998. The ABVV/FGTB merged several of its regional organisation into larger units. These regional organisations are responsible for organising members on an intersectoral basis and for part of the administrative work connected to unemployment benefits. The ACV/CSC saw the merger of its building and woodworking union (Centrale chrétienne du Bois et du Bâtiment/Christelijke Centrale Hout en Bouw, CCTBB/(CCHB) and its "various industries" union Centrale chrétienne de Diverses Industries/Christelijke Centrale van Diverse Industrieën, CCDI) into a new building and industry union (CSC-Bâtiment et Industrie/ACV-Bouw en Industrie), with 258,000 members. The ACV/CSC held its four-yearly statutory congress in November (BE9811253N), during which some important decisions were made concerning the position and role of union activists and union officials. A "charter for the activist" adopted at the congress contained a number of decisions on training, support and guidance for those representing the union at enterprise level. Another important step was a call for more collaboration between CSC/ACV's blue-collar industrial unions and its white-collar union, with a view to a possible integrated organisation at company level.

The intersectoral collective agreement for 1999-2000 contains an important new provision on the long-standing issue of union representation in small and medium-sized enterprises (SME s). A recent experiment with "pooled" union representation on a regional basis for the SMEs in the retail sector will be evaluated for possible implementation in other sectors.

Two important protagonists in Belgian industrial relations over the past decade announced their retirement at the end of 1998: Willy Peirens, president of the ACV/CSC and Wilfried Beirnaert, director of social relations and top negotiator at the Federation of Belgian Enterprises (Fédération des Entreprises de Belgique/Verbond van Belgische Ondernemingen, FEB/VBO)

The year saw few specific developments in terms of international-level employee representation. When companies reach new agreements on the creation of European Works Councils (EWC s), Belgian unions generally support the initiative. However, in the cases of the two most important company closures in Belgium in the recent years - Renault in 1997 and Levi Strauss in 1998 - a number of commentators have evaluated the experience of EWCs as rather negative. In neither case did informing the EWC and holding an extra round of consultation have a positive impact on the key issue: the decision whether or not to close a factory. The most important positive aspect of EWCs for unions seems to be that transnational trade unionism thereby becomes more of reality, and one that is increasingly closer to the rank and file. International union work was in the past limited to contacts at the highest levels of the organisation; it is now slowly becoming an issue involving activists and employees at all levels. A scientific evaluation of the workings of EWCs is underway in Belgium, in which both employee and employer representatives have been asked for their opinions. The results of this research will provide more information which might be valuable for the future positioning of the social partners.

Industrial relations and the impact of EMU

The law of 30 October 1998 (published in the Moniteur Belge on 10 November 1998) defines the details of the euro's implementation in Belgium. It covers conversion, pricing, continuity of consumer contracts and company capital, relations with public administration and company stock.

As for industrial relations and the euro, a collective agreement was signed on 17 July 1998 in the National Labour Council (BE9812159N). This agreement covers salaries and social benefits in monetary terms and defines the methods of conversion to be used for workers and those on social benefits. Firms have to inform their workers and are allowed to use the Belgian franc as a reference until 2001. The issue has been fleshed out and clarified by royal decrees.

Conclusions and outlook

An appropriate label for 1998 might be "a year of closures and reorganisations". Several significant and far-reaching mergers occurred in the important banking and insurance sector (BE9806238F), postal services were reorganised, the automobile industry was once again subjected to serious reorganisation (BE9808241N), and the closures at Levi Strauss and Lee Europe attracted much attention.

Workers and unions usually found themselves in a difficult position: alternatives to closures, such as collective working time reductions or work redistribution, were generally not accepted by the management of the companies concerned. What was left for the unions to negotiate, was usually - following Belgian bargaining traditions - a decent social plan accompanying the closure. These plans include traditional financial guarantees and compensations for the loss of income, and a number of measures helping employees to look for other job opportunities.

If 1999 resembles 1998, there will be further demands for a more socially integrated Europe alongside a common monetary policy at the European level. Within the framework of the European efforts to create more jobs, a positive Belgian initiative which could serve as an example deserves a mention. In the social and medical care sector, the governments of the regions and the federal government took important steps to create better working conditions, and an important financial injection was provided to create more jobs in the sector. By the end of 1998, this had resulted in the creation of approximately 10,000 additional jobs (BE9901259N). (Estelle Krzeslo, Point d'Appui Travail-Emploi-Formation, and Hans Bruyninckx, Steunpunt WAV)