New collective agreement for food and drink sector

In April 2007, the Finnish Food Workers’ Union and the Finnish Food and Drink Industries’ Federation reached consensus on a new collective agreement for the sector, thus averting the threat of a strike. The agreement period, which will run from April 2007 to the end of March 2010, includes provisions for a 3% pay increase in the first year of the agreement.

Employees in the food and beverages sector have been working without a collective agreement since late February 2007. In a dispute related mainly to working time arrangements, the Finnish Food Workers’ Union (Suomen Elintarviketyöläisten Liitto, SEL), affiliated to the Central Organisation of Finnish Trade Unions (Suomen Ammattiliittojen Keskusjärjestö, SAK), broke off talks in January and imposed a ban on overtime work from 12 March (FI0703039I).

The trade union insisted that it would not take part in negotiations if the Finnish Food and Drink Industries’ Federation (Elintarviketeollisuusliitto, ETL), affiliated to the Confederation of Finnish Industries (Elinkeinoelämän keskusliitto, EK), persisted in regarding a 10-hour workday and a 50-hour working week as preconditions for a new collective agreement. On 26 March, SEL issued a strike warning. The strike was set primarily to disrupt a total of almost 8,000 employees in 29 food factories, with food processing facilities and breweries being the worst affected.

However, in the end, ETL and SEL decided to resume talks aimed at a new agreement in late March. Both sides were optimistic that a deal could be struck before the Easter holiday period in early April. The trade union ban on overtime work in the sector remained in effect until then.

Content of new agreement

On 5 April, SEL and ETL announced that they had reached consensus on a new collective agreement for the industry, thus averting the threat of strike action. The agreement period runs from 5 April 2007 to 31 March 2010 and includes provisions for a 3% pay increase in the first year of the agreement. Pay increases for the subsequent years will follow the benchmark of the prospective national incomes policy agreement or of average sectoral pay increases. Once agreement was reached, the ban on overtime work expired on 5 April.

The central council of SEL discussed the outcome of the agreement and accepted it by a majority of 25 to eight votes. Thus, valid collective agreements will be in place for the industry for the next three years. The announcement of SEL emphasises how the agreement represented a kind of defence against the working time changes demanded by ETL. Instead, the shortening of annual working time through the use of so-called ‘pekkas days’, which refer to paid time off for employees, will be also extended to those working 37.5 hours a week.

One of the main negotiation goals of SEL was to restrict the use of hired work and external labour. However, the new agreement does not include any changes in this regard.

Impact of agreement

According to ETL, the new agreement will guarantee industrial peace over the long term, as well as new kinds of possibilities to organise working hours through local agreements. ETL also added that, due to pay increases, the pressure to raise food prices is obvious since cost-effectiveness has decreased while international competition has intensified in the food and beverages sector during recent years.

A special bipartite working group has been appointed, aimed at solving the questions related to working hours. All atypical working time models should be accepted at three levels: that is, with an employee, with a shop steward and also at the level of the trade union, as has been the practice to date.

The new agreement also allows for further improvements to its provisions during the agreement period, subject to the cooperation and approval of employers and local trade unions.

Pertti Jokivuori, Statistics Finland