Extensive use of compulsory arbitration to settle conflicts

Wage settlement negotiations in Norway during 2012 resulted in widespread strikes in the public sector, and the Government had to impose compulsory arbitration to settle a range of private sector disputes. The most high profile industrial action came in the oil sector. All of the strikes halted by arbitration had been allowed to run for some time – stretching from eight days to almost a month. It can be argued that the employers came out on top in all of these conflicts.

Introduction

The annual Norwegian wage settlement negotiations came to an end in December when the National Wages Board (Rikslønnsnemnda) ruled on the final two industrial conflicts in the 2012 bargaining round. Rulings were made on collective agreements for security personnel and for private nursing homes. Strikes among employees in the North Sea oil industry also ended in compulsory arbitration.

The National Wages Board had a busy 2012. The body has the authority to settle industrial conflicts through legislation which imposes compulsory arbitration between the parties involved (The 2012 Rulings, in Norwegian). The most extensive conflicts in connection with the 2012 wage settlement, however, were the strikes taking place in the public sector. They were all resolved without the use of compulsory arbitration.

Voluntary arbitration in the public sector

The most serious strike, measured by the number of working days lost, took place in the public sector. When agreement couldn’t be reached, three of the four employee confederations in the state sector agreed to call members out on strike on May 23, 2012. The industrial action spilled over into the municipal sector agreement area, and the result was a widespread public sector strike.

Arbitration resumed after nine days, and the parties managed to reach new agreements with the help of the state mediator. In one agreement area – involving the employee confederation Unio in the state sector – the confederation rejected the result of mediation, and the strike was prolonged for a further week. The parties then agreed to submit to voluntary arbitration.

Voluntary arbitration is rare in the Norwegian labour market. Unio’s decision to go to arbitration was interpreted as showing the union’s lack of faith its continued strike action. At the same time, however, it continued to refuse the offer it had earlier rejected. The National Wages Board decided Unio would have to agree to this deal which had been accepted by the other organisations.

Oil sector lockout triggers compulsory arbitration

The oil sector in Norway has, over the years, staged a large number of strikes, and there is strong competition between the sector’s trade unions. In 2012, however, the competing employee organisations joined forces in an effort to secure the early retirement scheme that the employer was threatening to end. The unions failed to win employer support for their demand and launched a strike affecting oil companies in the North Sea.

The North Sea strike lasted for 14 days, and involved, at the outset, only a limited group of workers. The employers responded with a lockout. The strike action was limited at first, but was later extended to all organised workers in the affected areas. The threat of an all-out lockout resulted in the Norwegian Government intervening, halting the conflict with a proposal to impose compulsory arbitration.

The escalation of the conflict by the employer was interpreted by many as a deliberate strategy to force compulsory arbitration. The national authorities, in all previous strikes in the oil sector, had shown little willingness to accept industrial action that might cripple Norway’s oil and gas deliveries abroad (NO0007197N, NO0407102N).

The National Wages Board considered the case in the autumn of 2012. The employee organisations had called the strike demanding the introduction of an early retirement scheme with pension payments at the same level as the original scheme. This was rejected in line with the usual practice of the National Wages Board of not introducing new principles into a collective agreement subject to dispute.

Strikes in private services industry

Compulsory arbitration was also used to halt two strikes in the private services industry. It involved security guards in security companies and employees in private nursing homes. The Government intervened in the security sector strike on the grounds that a strike would have a negative effect on society and have serious economic consequences. In particular, the Government was concerned about its effect on the running of various airports around the country. For private nursing homes, the justification used was the strike’s potential consequences for the health and safety of the patients affected.

The central issue in dispute in the strike in the private sector nursing homes was the demand put forward by the Norwegian Union of Municipal and General Employees (Fagforbundet) for the introduction of an occupational pension scheme similar to the one in the public sector. The demand was not endorsed by the National Wages Board.

In the security sector strike, the social partners mainly disagreed on economic issues. In both cases the authorities pointed to the fact that other agreements had been entered into with other unions in those particular agreement areas. The wages board chose not to back demands that would improve pay and conditions beyond those already established by the other agreements.

Commentary

The 2012 bargaining round began peacefully. In large parts of the private sector the social partners managed to conclude agreements without resorting to industrial action. However, 2012 ended as a year when a significant number of working days were lost to industrial action. Most of these were lost in the large strikes in the public sector.

It also was a year when the Government decided to intervene in bargaining on several occasions, and stop conflicts by placing proposals for compulsory arbitration before the Norwegian Parliament.

All of the strikes that were stopped had been allowed to run for some time – from between eight days to almost a month.

Even so, it can be argued that the employers have come out on top in these conflicts. Controversial demands involving occupational pension schemes have not been met, and the unions involved have not won any significant victories, having to accept the conditions already established in other collective agreements. This is in line with the National Wages Board’s common practice which is careful not to introduce new principles or items into agreements subject to dispute.

However, the 2012 wage settlement round also proved that strikes in the public sector can be resolved voluntarily. In spite of the fact that strike action followed the negotiations in the state sector, as well as those in the municipal sector and in the municipality of Oslo, none of these disputes were stopped by the national authorities.

Norway has previously been criticised for its use of compulsory arbitration (NO0805029I), and the measure is controversial (NO0210104F), but it is too early to say whether any of the recent strikes will be subject to petitions before an international body such as the International Labour Organization (ILO) or the European Committee of Social Rights.

Kristine Nergaard, Fafo