Committee proposes enhanced authority for mediators and restrictions on right to strike

Sweden's rules on industrial action should be made stricter and public mediators should be given enhanced authority. These highly controversial proposals were put forward in a report presented by an official committee on 30 November 1998. The fate of the proposals is probably dependent on the success or failure of current talks on a "pact for growth" between trade union and employers' confederations.

In 1997, the Swedish government appointed a committee charged with the task of proposing measures leading to an improved system of pay determination, whereby public mediators would be given improved opportunities to promote "overall public interests" in negotiations. The committee's terms of reference were highly controversial and during the year that followed trade unions and employers' organisations repeatedly declared (SE9712160N) that they did not accept state intervention in the bargaining process (SE9811121F).

On 30 November 1998, the committee presented its final report (Medling och lönebildning, SOU 1998:141) to Minister Mona Sahlin at the Ministry of Industry and Commerce. It proposes a number of measures that, according to the committee, should make it easier for the bargaining parties to reach agreements and avoid industrial action.

Enhanced authority for mediators

On mediation, the committee makes the following proposals.

• A new Mediation Authority, with a significantly stronger position than the present one, should be established.

• Among its general tasks, the new Authority should contribute to the setting of standards for pay. Thus, pay statistics should be improved, and each year the Authority should draw up reports on trends in pay in Sweden and in other countries and on the economic preconditions for pay bargaining. These reports should contain a special chapter on trends in pay from an equality perspective. Another general task would be to encourage coordination of the timetables for negotiations and agreement periods for different sectors, as well as the coordination of the negotiations themselves.

• In contrast to the current situation, the Authority should have powers to appoint a mediator without the consent of the bargaining parties. The bargaining parties should be obliged to attend meetings called by the mediators. The latter, however, would not be able to impose any compulsory arbitration award upon the parties.

• The normal period of notice for industrial action should be extended from seven to 14 days, and the mediators should also have the authority to postpone notified industrial action by 14 days.

Proportionality in industrial action

The committee believes that there is a need for a shift in the balance of power between trade unions and employers and therefore proposes stricter rules on industrial action.

• A principle of "proportionality" should be introduced. An organisation should thus not have the right to take industrial action resulting in substantial costs for the opposite party and third parties, without itself incurring substantial costs.

• The right to take sympathy action should be limited.

• Industrial action against sole traders or family companies should be prohibited.

• The government should appoint a council to hold regular discussions with the organisations on the labour market to "restore understanding and harmony" and help them to achieve a common understanding of what is good for the country. This common understanding is specified as a "preference for low nominal pay cost increases and low inflation". It is stated that countries such as Austria, Denmark, Finland, Ireland and the Netherlands have benefited from this kind of approach.

Negative reactions

Immediately after the publication of the report, the Swedish Confederation of Professional Employees (Tjänstemännens Centralorganisation, TCO) and the Swedish Confederation of Professional Associations (Sveriges Akademikers Centralorganisation, SACO) issued a joint statement rejecting the proposals as, taken together, more harmful than useful. The task of the mediators should be to minimise the risk of industrial action, not to define the parameters for increases in pay. These unions stated that the best way for the state to promote an effective system of pay determination should be through a sensible economic policy and a stable tax and social security system.

The Swedish Employers' Confederation (Svenska Arbetsgivareförenignen, SAF) also objected to the idea that the Mediation Authority should have a role in the setting of standards for pay. The proposals on the restrictions to the right to strike are, however, a step in the right direction although they do not go far enough, SAF believes.

The Swedish Trade Union Confederation (Landsorganisationen, LO), which represents blue-collar workers and is the largest of the union confederations, has yet to make any official statement. Lately, it has seemed ready to discuss some restrictions on the right to strike provided that they are introduced by means of collective agreement. It has, however, always strongly opposed statutory restrictions in this respect.

Commentary

In most cases, reports by Swedish official committees such as the one in question lead to some form of legislation. However, official committees have considered the issue of mediation and industrial action three times before since the beginning of the 1980s, without any result. The fate of this latest highly controversial report is probably dependent on the success or the failure of the talks at present going on between the employers' and trade unions' confederations on a possible "pact for growth" (SE9811122N). Just before Christmas 1998, the negotiations seemed to have broken down, but we have not seen the end of this story yet.

The most surprising part of the committee's report is the proposal that the right to sympathy action should be restricted, as sympathy action probably has a marginal effect, if any, on pay determination generally. The proposed restrictions might, however, have an adverse effect on the coverage of collective agreements, and limit the ability of trade unions to exercise control over businesses whose practices are seen as dubious. This would be a challenge to the basic conditions of the Swedish system. (Kerstin Ahlberg, Arbetslivsinstitutet).