Paper workers on strike

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On 11 April 2000, the Finnish Paper Workers' Union launched the first nationwide strike in its history, covering all 30,000 members in the paper sector, which has a key role in Finland's exports. Negotiations over a new sectoral agreement had broken down due to disagreement concerning working time, security in the event of lay-offs, bonus systems, subcontracting and wages.

On 11 April 2000, the Finnish Paper Workers' Union (Paperiliitto) started the first nationwide strike in its history, involving all of its 30,000 members. The strike surprised commentators, because such wide-scale action had not been forecast.

In spring 2000, collective bargaining in Finland has been occurring at sector level, as a central incomes policy agreement proved impossible to reach (FI9910124N). After initial relatively smooth progress in metalworking (FI0001133F) and many other sectors (FI0002135N), disputes broke out in chemicals and transport (FI0003137N). Settlements have now been reached in these sectors, but disagreement persists in one of the most important export sectors – the paper industry.

In autumn 1999, the Paper Workers' Union (Paperiliitto) announced its unwillingness to embark on another central incomes policy agreement, following those covering 1995-9, on the grounds of sector-specific problems. Negotiations with the employers – represented by the Finnish Forest Industries' Federation (Metsäteollisuus ry) - proceeded in fits and starts throughout the winter, having begun in October 1999. The main sectoral issues at stake are:

• wage increases;

• rules on the use of outside labour and subcontracting;

• improved security in the event of lay-offs;

• regulation of bonuses by collective agreements; and

• working time issues

The aim of the negotiations was to achieve a two-year agreement. The union was pressing for a considerably greater wage increase than the general norm of 3.1% set in the 2000 bargaining round, with its demands amounting to an increase in costs of 4% in the first year and about 6% in the second year. Furthermore, the union wanted to cut annual working time by seven shifts during the three-year period. The employers did not accept these demands, and on 28 March the union issued a warning of an indefinite strike to start on 11 April. There was no progress and a nationwide strike duly began on 11 April, stopping operations in all the pulp and paper factories in the country.

The Swedish Paper Workers' Union (Papperindustriarbetareförbundet, Pappers) has announced that it will back the Finnish strike by monitoring orders coming into Swedish factories owned by Finnish companies and preventing orders diverted as a result of the Finnish strike from being met. The most extreme comments made by Finnish employers have alluded to moving production outside Finland in the event that unions do not reduce their demands significantly.

The differences between the positions of employers and union in the paper sector can be considered significant, concerning matters of principle that are difficult to resolve. The employers have not been willing to give way to the union's demands, justifying their viewpoint by pointing to the threat of reduced competitiveness. Previously, even high wage increases that have potentially weakened the competitiveness of the paper industry had been compensated by devaluation. Now that Finland has joined EMU, this alternative no longer exists, and the employers compare the wage level closely with that of other EU countries (FI9711138F). The union points to improved productivity and good results, and the current strike is aimed at gaining a share of these improvements for the employees. It is estimated that the cost of the strike for the paper industry is several hundred million FIM per day in lost income. When the significant effects on the national economy are also taken into consideration, it can be predicted that the strike will not last too long.