Employers opt for voluntary membership

On 25 April 2012, the Chamber of Crafts and Small Business of Slovenia (OZS) organised a referendum on whether membership should be compulsory or voluntary. The OZS, formerly part of the pre-market economy system of business organisation, represents the trade and business interests of independent craftworkers and small enterprises, and membership had been obligatory. Turnout for the referendum was low, but more than two-thirds of voters opted to reject compulsory membership.

Background

Before the change of socioeconomic system and the introduction of a market economy, all Slovenian enterprises and craftworkers were organised in ‘chambers’ (parastatal organisations), of which membership was obligatory. After the change in the country’s socioeconomic system, the mandates of these chambers were extended and they also began to function as employers’ organisations alongside the more conventional type of employers’ organisations common in other parts of the EU. The chambers had two basic functions; negotiating on behalf of employers, and promoting the trade and businesses of their members. International Labour Organization (ILO) conventions provide for freedom of association of employers and workers (SI0211102F, SI0411303F, SI0510307F, SI0508303F). The mandatory membership structure of the chambers did not comply with ILO conventions.

In May 2006, the Slovenian parliament adopted the new Law on Chambers of Commerce and Industry (LCCI). According to the LCCI, membership of the Chamber of Commerce and Industry of Slovenia (GZS) should no longer be compulsory (SI0606019I). However, the LCCI does not affect other Slovenian associations that require compulsory membership and that function as employer organisations, concluding collective agreements on the employers’ side. This meant membership of the Chamber of Crafts and Small Business of Slovenia (OZS) remained compulsory.

However, Article 32 (employers’ associations with mandatory membership) of the Law on Collective Agreements (LCA), adopted by parliament on 12 April 2006, states: ‘Notwithstanding the provision from paragraph 1 of Article 2 of this law, collective agreements on the side of employers may also be concluded by associations of employers with mandatory membership in the transitional period of three years after this law enters into force’. This meant that in 2009 the OZS ceased to function as an employer organisation.

On 4 December 2011, Slovenia’s first-ever snap parliamentary election was held to select the 90 deputies of its National Assembly. The centre-left coalition was replaced by a new centre-right coalition. Part of the new coalition agreement was that OZS membership would have to be voluntary unless the members of a chamber themselves chose compulsory membership in a referendum.

Referendum

As a result, the OZS organised a consultative referendum on 25 April 2012 asking all its members to vote on whether membership should be compulsory or voluntary. The referendum question was: ‘Do you agree that in the OZS and its regional chambers, the legally determined compulsory membership should remain?’

The OZS members voted for voluntary membership, though the turnout was only 18.16%, with only 9,320 of the organisation’s 51,318 members taking part. More than two out of every three voters were in favour of voluntary membership.

Commentary

As the membership of the OZS will now be voluntary, the OZS will be able to claim that it legitimately represents employers’ interests and acts as an employer organisation.

The OZS membership fee can be as high as €600 a year. The question remains what kind, what amount and what quality of services do the members get for their money?

Up until now the OZS has been provided with the financial means necessary for its operation automatically through compulsory fees. With voluntary membership it will be more exposed to market forces and to competition. This will involve the ‘chase for members’ and should lead to the improvement of services.

Nevertheless, the number of OZS members is likely to decrease. But this should not necessarily lead to the fragmentation and destruction of OZS anticipated by OZS leadership. The GZS also lost members after the introduction of voluntary membership, but has survived.

Štefan Skledar, UMAR