General strike as civil service pensions law is adopted

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After 30 months of negotiations at all levels, in July 1998 the Luxembourg Government extended the session of the Chamber of Deputies by a week in order to vote through a law reducing the pension entitlements of civil servants and state employees. The same day, a general strike in the public sector brought the country to a standstill.

The long-running dispute over the Government's proposal to reform the civil service pension scheme (LU9706111F) reached its climax in July 1998. Following the breakdown of talks in January 1998 (LU9802146N), the largest public sector union, the General Public Sector Confederation (Confédération Générale de la Fonction Publique, CGFP), triggered a dispute procedure which began with conciliation. A conciliator submitted a proposal in May 1998, which was rejected by the unions, triggering the next stage of the dispute procedure - mediation conducted by the President of the Council of State (Conseil d'Etat) (LU9806164F). On 1 July, following frequent meetings with representatives of the Government and the CGFP, the mediator acknowledged that it was impossible to bring the parties together, but developed ideas for their consideration (LU9807170N).

The Government stated its belief that the mediation procedure had been exhausted. However, the CGFP went to see the mediator once more to tell him that it thought his ideas "bore closer examination". When the Government refused to examine the ideas more closely, and announced its intention of extending the session of the Chamber of Deputies by a week in order to vote through the pensions law, events became dramatic.

CGFP subpoenas Government

At a press conference called on 8 July, CGFP deplored the Government's intention to extend the session of the Chamber of Deputies, alleging that the Government was seeking to "force the hand" of civil servants again just before the long school holidays. The union recalled that the minister responsible for the public sector had specifically "guaranteed the integrity of the system of civil servants' pensions" at a meeting on 28 September 1990. According to the union, the proposed law would clearly breach a joint agreement, which could be reviewed only by means of a fresh agreement.

In response to these accusations, the Prime Minister was subpoenaed to appear before Luxembourg's civil court of first instance, the Tribunal d'Arrondissement, to determine if the draft legislation breached a civil undertaking, and to decide whether an instruction should be issued to have the law withdrawn.

The subpoena process caused shock in political circles, and political parties stated almost unanimously that it was not for the courts to prevent Parliament from independently performing its task as legislator.

Council of State gives broadly positive opinion

The task of the Council of State is to give opinions on all draft legislation before it is voted on by the Chamber of Deputies. On 10 July 1998, the Council handed down an opinion on the draft pensions law that might be described as "broadly positive". The opinion referred to the "need to act in the field of public sector pensions". It also rejected the civil servants' main legal argument that rights already granted ("acquired rights") could be unilaterally taken away.

Moreover, the ancient principle of pacta sunt servanda(ie contracts must be observed) did not apply in the public sector, as the latter's "status" is the exclusive competence of Parliament.

Otherwise, the Council of State did no more than propose some specific amendments, and adopt a "principled opposition" to one provision of limited importance.

The minister responsible for the public sector was delighted with the Council of State opinion. He said that the Government would accept the criticism that it contained, and submit to the Chamber of Deputies a version incorporating the suggested amendments. The minister also announced that the draft would be debated on 21 July 1998.

Local authority workers call for debate to be deferred.

The proposed pensions legislation affects local authority workers as well as state civil servants. Local authority staff have to follow an identical conciliation and mediation procedure to the one employed in the civil service before they can take the ultimate sanction of strike action, if that proves necessary. As the minister of the interior (who is also the minister responsible for the public sector) has not followed up a request to appoint a conciliator for the local authority workers' pensions grievance since 10 April 1998, these employees are not legally permitted to go on strike - this is possible only once the dispute procedure is exhausted. The workers concerned thus called for a postponement of the planned debate in the Chamber of Deputies.

In protest against this "unacceptable approach", hundreds of demonstrators waited for deputies outside the Chamber entrance on 14 July, greeting them with shouts and catcalls when they arrived.

However, both the Prime Minister and the minister of the interior announced that, despite the absence of valid statement of non-conciliation (ie, the exhaustion of the dispute procedure), this category of staff could go on strike if they believed that it would help them preserve their rights.

General strike in the public sector

Following the decision to vote on the draft law on 21 July, the CGFP and other unions in the public sector called their members out on a general strike on that day in protest against the "government's policy of social dismantling".

The strike call was observed by most civil servants and local authority staff:

• there were no trains or local authority bus services;

• a combination of the absence of public transport and hold-ups seriously disrupted traffic, particularly in the city of Luxembourg; and

• response to the strike call in the various public services varied from 80% to 100%.

Draft law voted through

Meanwhile, demonstrators waited for members of Parliament outside the Chamber. As each deputy's voting intentions were known in advance, some were applauded into the building, while others came in for heavy censure. Probably for the first time in Luxembourg's history, members of the government had rotten eggs and tomatoes thrown at them.

The draft legislation was approved by the majority parties - the Christian Social People's Party, and the Luxembourg Socialist Workers' Party - and the Action Committee for Democracy and Decent Pensions (LU9706111F), giving a total of 42 votes in favour. The Democratic Party and the Greens voted against (17 votes). The debate lasted six hours.

In broad terms, the draft law incorporates the suggestions made by the conciliator in May, which constitute a slight improvement from an employee point of view (LU9806164F).

Commentary

After some 30 months, the cut in civil servants' pension entitlement would at last appear to have been achieved.

For once, however, the "Luxembourg model" has not worked. The content and outcome of discussions on the subject have shown that, for a number of years, there has been a split in Luxembourg society between people in receipt of public sector and of private sector pensions, and the matter cannot be considered to be closed.

The outcome of the next general election in June 1999 will be awaited with more than the usual interest: the CGFP slogan is "Wahltag ist Zahltag" ("Election day: the day of reckoning").

The two main trade unions in the private sector sympathise with the two government parties, but have kept themselves at a discreet distance in the dispute; however, by continuing to demand an increase in their members' pensions, they too could well be in for a nasty shock in the months ahead.

Meanwhile, politicians arguably appear to have forgotten that they themselves set up a Constitutional Court that has been in existence since 1997, and whose verdict in a few years' time - when cases against the new legislation finally come before it - could come as a surprise. (Marc Feyereisen, ITM)