Social partners sign new national agreement
A new National General Collective Employment Agreement (EGSSE) has been signed by social partners in Greece. For the first time, the agreement does not include reference to the country’s national minimum wage. This is now set by the government, which is no longer obliged to consult with social partners. The new EGSSE is limited in terms of content and application, but it is hoped that it will prevent further private sector wage cuts. The employer group SEV refused to sign the agreement.
A national collective agreement signed by social partners in Greece came into effect on 1 January 2010 and expired on 31 December 2012. The agreement’s period of validity was extended pending the conclusion of a new deal, but this extension was due to expire on 15 May 2013.
The 2010 agreement, signed by all four leading social partners, had set the minimum monthly wage at €751.30 gross. It applied to all workers, as laid down in previous legislation.
However, in accordance with the new laws introduced by the Troika’s Memoranda of Understanding, the Greek Government has taken over the power to set the minimum wage without agreement from the social partners.
Ministers reduced the minimum wage in February 2012 by 22% to €586 gross, and by 32% to €510.95 gross for those under 25 years of age.
New legislation also suspended the automatic increase in earnings for each three-year period of work experience beyond three years, and abolished the marriage allowance and other allowances.
In addition, according to Law 4093/2012 passed in November 2012, the collective agreement is binding only for employees of enterprises that are members of the signatory employer organisations and may only concern issues of an institutional nature, such as leaves of absence.
Against this background, a series of talks have taken place over the past few months to conclude a new agreement. The tourism sector employers’ organisation, the Association of Greek Tourism Enterprises (SETE), which has legal recognition as a national social partner, also took part in these discussions.
After three consecutive meetings, on 14 May 2013 a new National General Collective Employment Agreement (EGSSE) was signed by all the social partners except the Hellenic Federation of Enterprises (SEV).
The agreement was signed by the Greek General Confederation of Labour (GSEE), the Hellenic Confederation of Professionals, Craftsmen & Merchants (GSEVEE), the National Confederation of Hellenic Commerce (ESEE), and SETE. The social partners said they recognised the need to maintain the National General Collective Employment Agreement as an active institution, and to restore its political, social and economic role.
The new EGSSE says that the ‘Contracting Parties’ should commit to take joint initiatives against the government to tackle unemployment and combat uninsured and undeclared employment. The parties should also work towards amending the new legal framework that imposes restrictions on collective autonomy, restoring the full and universal validity of the EGSSE, and expanding collective agreements.
The EGSSE says the parties will also work together to tackle the economic crisis. They will consult on how competitiveness and the economy can be strengthened, not through reducing wages but by looking at structural factors. These might include transport, energy and other costs, and the tax system.
The agreement says that the marriage allowance should remain in force and shall be granted to all salaried employees regardless of sex, as stipulated by the EGSSE of 1988. It says all the institutional working conditions agreed in previous EGSSEs and the corresponding arbitration awards should remain in force. These would include maternity leave, confinement leave and sabbatical leave. Any favourable working conditions which may be provided for by laws, decrees, ministerial decrees, collective agreements, arbitration awards, bylaws, customs, business practice or individual employment contracts, should also remain in place.
The new agreement, say the social partners, will be valid from 1 January 2013 until 31 December 2013. Provision should be made for its term to be extended for a further year with the agreement of the parties.
The agreement is valid retrospectively from 1 January 2013 to cover the time during which the grace period of the previous agreement was in force.
Other sectoral agreements
These developments directly affect sectoral agreements. The validity of 45 sectoral agreements was extended for three months but they have now expired and no longer exist, leaving the workers previously covered by them unprotected.
While the number of sectoral agreements has declined, the number of business-level agreements recorded has increased significantly. Data from a survey conducted by the Organisation for Mediation and Arbitration (OMED) show that 976 business-level Collective Employment Agreements were signed in 2012, compared to 179 in 2011 and 238 in 2010.
Social partners’ reactions
The social partners’ representatives who did sign the agreement have argued that it keeps social dialogue open and collective bargaining alive. But they expressed their disappointment that the SEV had refused to sign it.
The SEV argued that the agreement had no legal foundation and offered no essential benefits for employees. Institutional issues, it says, are covered by the existing legal framework. The marriage allowance, the only wage-related issue dealt with in the agreement, is only relevant to the members of each organisation. The SEV argued that it had already made sure this allowance was safeguarded for its members.
This ‘so-called EGSSE’, said the SEV, was tantamount to a cancellation of the institution of a National General Collective Employment Agreement.
Instead of the EGSSE, the SEV counter-proposed the signing of a protocol of agreement by the social partners. It said this would strengthen the institutional acquis and lead to a new model EGSSE that could come into force by January 2014.
The GSEE believes that despite the very difficult circumstances at present, the institution of the EGSSE has been rescued by the new agreement. The validity and the rate of the marriage allowance have been confirmed for hundreds of thousands of workers, and the current institutional achievements of all previous National Agreements have been kept intact and unimpaired. However, the GSEE said it would continue the struggle to reverse legislation that had abolished free collective bargaining.
The GSEVEE said it was necessary:
...to set a limit on wage cuts for workers, because otherwise there will be social automation and that, if the current agreement did not exist, the wage of 80% of workers in the private sector would be reduced to €586.
It went on to say:
In an introverted economy as the one in Greece, which is heavily based on internal consumption, this event would lead to the closure of small and medium-sized enterprises and, thus, to the increase of unemployment and the further reduction of social security contributions.
The ESEE believes that the signing of the new National General Collective Employment Agreement will prevent new wage cuts in the private sector. It said the EGSSE could not be replaced by any ‘protocol of agreement’ as suggested by the SEV. It also expressed its satisfaction about saving the marriage allowance.
The SETE argued that the market did not need a further reduction of labour costs. Instead, it needed structural changes that required consensus and cooperation between the social partners.
For the first time in Greece, a National General Collective Employment Agreement has been signed by social partners without having any effect on the regulation of the minimum basic wage.
Never before has an EGSSE had such limited content and influence.
This situation is causing serious concern for the future of the employees’ wages as well as for the future of the indicators that they affect – things like private consumption, social security contributions, tax revenues and poverty.
However, in this way, the risk of wage reductions for the employees who are remunerated based on the EGSSE or on the 45 sectoral agreements, whose three-month extension of validity has expired, is being warded off.
Penny Georgiadou, Labour Institute of Greek General Confederation of Labour (INE GSEE)