Cgil and some employers' associations do not sign fixed-term work agreement

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In May 2001, Italy's Cisl and Uil trade union confederations (together with the independent unions, Ugl and Cisal) and 12 employers' associations, including Confindustria, each submitted to the government a "joint statement" they had reached on the transposition of the 1999 EU Directive on fixed-term work. The agreement was reached after lengthy negotiations, during which the Cgil union confederation pulled out of the talks. Five employers' organisations also decided not to sign the agreement, which lifts a number of restrictions on the use of fixed-term employment contracts. The Directive should be transposed by July 2001, by means of a government bill and approval by parliament.

At the beginning of May 2001, a number of social partner organisations each submitted to the government independently a joint statement on the transposition into Italian law of EU Council Directive 1999/70/EC of 28 June 1999 concerning the framework agreement on fixed-term work concluded by the European Trade Union Confederation (ETUC), the Union of Industrial and Employers' Confederations of Europe (UNICE) and the European Centre of Enterprises with Public Participation and of Enterprises of General Economic Interest (CEEP) (EU9905170F).

The trade union organisations which signed the joint statement were the Cisl and Uil confederations and the independent Ugl and Cisal. The 12 employers' associations concerned were the Confindustria confederation, plus Abi (banks), Ania (insurance), Confartigianato and Casartigiani (crafts), Agci, Confcooperative and Unci (cooperatives), Confagricoltura, Coldiretti and Cia (agriculture), and Confetra (transport). The joint statement represents a "partial" or "separate" agreement, because Cgil, Italy's largest trade union confederation, with a socialist and communist tradition, did not sign, expressing strong criticism of its contents and the manner in which the talks had been conducted. Besides Cgil, a number of important employers' associations also did not sign the agreement - Confcommercio and Confesercenti (commerce), Cna (crafts), Lega delle cooperative (cooperatives) and Confservizi (local public services).

The signatory organisations decided to send their agreement to the government, believing it pointless to continue with negotiations with the other organisations, as these were marked by what they considered as insuperable divisions. The talks, which began in March 2000, drew considerable attention in the context of the current public debate on bargaining and industrial relations when, in February 2001, Confindustria suggested that such deals could be made without the consent of all the largest trade union organisations, accusing Cgil of not wanting to reach an agreement (IT0102277F). Cgil, for its part, argued that Confindustria was trying to provoke a split in the trade union front.

The labour minister, Cesare Salvi, intervened in the debate, declaring that the government would not feel itself bound by a partial agreement, and that it would proceed with incorporation of the EU Directive into Italian law taking account of the opinions of the non-signatory organisations as well. Mr Salvi's intervention was deemed inopportune by both Confindustria and Cisl. In any event, the minister urged the social partners to continue their negotiations, in order to reach an agreement which did not exclude any of the main representative organisations. In March 2001, Cgil walked out of the talks, declaring that the discussion was moving towards the "liberalisation" of fixed-term contracts. Definitive transposition of the new rules on fixed-term work should now be completed by July 2001 (the deadline set in the Directive), by means of a government bill and approval by parliament.

The agreement reached

The joint statement signed by the social partners, with the important exceptions mentioned above, proposes to the government a system of regulating fixed-term work based on the following main points.

• Workers may be hired on fixed-term contracts for technical, productive and organisational reasons or in substitution for absent personnel.

• The fixed-term nature of the contract should be stated in writing.

• Fixed-term recruitment may not be used: a) to replace workers on strike; b) to take on workers for work tasks identical to those of workers who have been involved in collective dismissals during the six previous months, except where collective agreements provide otherwise; c) to hire workers to replace others receiving redundancy benefit (from the wages guarantee fund); or d) when the firm concerned does not comply with rules on workplace health and safety, notably those which require risk assessment.

• No maximum duration is envisaged for fixed-term contracts. However, they may be extended, with the consent of the worker concerned, if the duration of the initial contract is less than three years. In the event of extension, the total duration of the fixed-term employment relationship, ie including the extension, may not exceed three years.

• The worker may be rehired on a fixed-term contract if at least 10 days have elapsed since expiry of the previous contract in the case of contracts of less than six months' duration, or 20 days if their duration is more than six months. Should this rule not be respected, the second contract must be considered an open-ended contract.

• The principle of non-discrimination between temporary and permanent workers is established, especially as regards financial aspects, where job ranks are equal.

• Workers on fixed-term contracts are entitled to receive training to address the risks connected with the job undertaken.

• Sectoral collective bargaining will define: a) the possible activation of specific measures to facilitate access by temporary workers to training opportunities which will upgrade their skills, promote their careers, and improve their occupational mobility; b) the information to be provided to temporary workers on job vacancies within the company; c) the means of granting a right of precedence to seasonal workers for recruitment to job positions in the same company and with the same qualification as those that they have performed; d) the information to be made available to the workers' representatives; and e) the imposition of quantitative limits on the use of fixed-term employment contracts. However, these quantitative limits do not apply to fixed-term contracts concluded: i) for the start-up of new activities, within the time limits established by collective bargaining, with differentiation by sector and geographical area; ii) for substitutions; iii) for seasonal work or in order to meet production peaks; iv) for young workers hired after the conclusion of work placements or internships, or for workers aged over 55; or v) for a duration of less than seven months, including extension, or for a longer duration defined by collective bargaining with reference to specific geographical areas characterised by employment difficulties.

Social partner reactions

The signatories to the agreement consider that the negotiations have led to positive results and, in the letter to the minister of labour which accompanied the text of the joint statement on fixed-term work, they recognise that "open-ended work contracts represent the common form of the employment relationship". Confindustria is satisfied with the outcome of the negotiations, because the agreement "gives greater flexibility to the labour market, it may make a notable contribution to employment growth, and, at the same time, help reduce the irregular 'underground' economy". Confindustria has also expressed the hope that the agreement "may represent a joint reference even for those organisations which, for various reasons, do not consider, today, the negotiations to be concluded".

Cisl considers the negotiations between the social partners to be completed and believes that the final decision now rests with the government. According to the Cisl general secretary, Savino Pezzotta, the agreement's contents are "in line with the EU Directive" and better than the measures transposing the Directive into the national laws of other European countries. However, Mr Pezzotta believes that the trade unions should reflect on the divisions that opened up within their ranks during the negotiations. They should acknowledge that different assessments can be made on specific decisions, engaging in tough discussions on trade union and labour issues but overcoming their different perspectives on politics and their political divisions.

Unlike Cisl, for Cgil the question is still open. Sergio Cofferati, the latter's general secretary, has argued that "until parliament has transposed the EU Directive on fixed-term contracts the game is not over; there is no binding agreement or consensus. The final act rests with parliament, and there is nothing to suggest that the matter is closed." In particular, Cgil considers that the agreement does not comply with the content of the EU Directive, because, in its opinion, the new provisions would restrict the role of collective bargaining in regulating the use of fixed-term work. Criticisms of the agreement have not been advanced only by Cgil; some employers, and especially Sergio Billè, the president of Confcommercio, have also been critical, seeking until the conclusion of the talks to avoid a partial agreement which would split the social partners.

Commentary

The content of the joint statement, although it is a "separate" deal, seemingly proposes to the government a significant relaxation of the restrictions on the use of fixed-term contracts. In effect, a system in which the use of fixed-term contracts was possible only in specific circumstances defined by law or collective agreements would give way to one in which such contracts are restricted by quantitative ceilings defined by collective bargaining. Moreover, the numerous exemptions from these ceilings seem to attenuate to a considerable degree the new type of constraint on the use of fixed-term contracts envisaged by the agreement. Among these various exemptions, particular mention should be made of those concerning young people after the conclusion of internships or work placements and "older" workers, given that they may support the employment of particularly vulnerable categories (especially workers aged over 55).

The aspect of the joint statement affair with the most acute bearing on industrial relations, however, is the split provoked among the trade unions. The agreement on fixed-term contracts is a further cause of conflict among the union confederations, especially between Cisl and Cgil, following cases such as the clashes over the Milan employment pact (IT0103278F) and the Fiat Cassino agreement (IT0104180N). However, there still seems to be a willingness to conduct joint action, and the current renewal of the metalworking sectoral agreement and talks on revising the 1995 reform of the pensions system (IT0104184F) may provide important opportunities for the reforging of union unity. For the time being, though, the situation is uncertain and relations are tense.

Also significant is the split within the ranks of the employers, especially because it involves an entire sector (commerce) and notably Confcommercio, which traditionally stands close to Confindustria's positions. Consequently, the split may signal serious disagreement with the stance taken by Confindustria, which believes that the route of what it calls "separate accords" is practicable once it has been established that a more encompassing agreement is impossible.

Many of these issues, and in particular the specific form in which the EU Directive on fixed-term work is transposed into Italian law, will depend crucially on the attitudes of the new government. The ministry of labour will no longer be headed by Mr Salvi, who had declared that the government should also take account of the opinions of organisations which do not sign a separate agreement. Silvio Berlusconi, at the height of the campaign leading up to the success of his centre-right coalition in the elections of 13 May 2001, declared that in the absence of overall agreement, the government should present the rules that it deems fairest to parliament for approval. In view of the July 2001 deadline for transposition of the fixed-term work Directive and the forthcoming talks on revising the pension reform law, industrial relations may prove to be a major test for the new government during its first 100 days in office. (Roberto Pedersini, Fondazione Regionale Pietro Seveso)