Publications

The statutory minimum wage in Luxembourg has been increased by 3.2% from 1
January 1997, as a result of legislation, and additionally by 2.5% from 1
February 1997, under the terms of an index-linked mechanism.

Following the freezing of civil servants' salaries imposed by the Government
for 1996, the Government announced the convening of pay negotiations which
have been continually put off since the spring of 1996, but which will now
not take place at all.

Employers and unions want to reduce the amount of temporary recruitment and
the number of types of employment contract. They also want to increase their
freedom to negotiate labour market issues through collective bargaining.
These are the key issues in the current debate over a new round of labour
market reforms in Spain.

As the 1 May election date draws nearer, both the Conservative Government and
the main opposition party, Labour, have begun to fight their campaigns by
taking opposite stances on the social policy Agreement annexed to the
Maastricht Treaty on European Union - the so-called "social chapter", from
which the UK has "opted out". In February, the Government launched an attack,
stating that if the Labour Party were to win the general election, its
commitment to "signing up" to the social chapter would cost the UK 500,000
jobs.

In January 1997, the European Commission adopted a report on the Promotion of
Participation by Employed Persons in Profits and Enterprise Results,
including equity participation (PEPPER II). The report suggests that
profit-sharing schemes lead to higher productivity, whatever method, model
specification and data are used. The macroeconomic situation was found to
have little effect on government or social partner support for such schemes,
but recent debates relating to enhancing productivity and wage flexibility
are stimulating discussions on proposals. However, in most member states,
trade unions can be expected to oppose the use of financial participation
schemes to promote wage flexibility.

At the end of January 1997, the Prime Minister ended the practice of issuing
pay guidelines to France's nationalised companies.

In the Works Constitution [1] Act (Betriebsverfassungsgesetz) of 1972, works
councils [2] in Germany are given extensive rights of information,
consultation and co-determination [3]. The employer has to provide the works
council with both timely and comprehensive information on all matters related
to the discharge of its functions. In establishments with over 20 employees,
information must be given "in full and in good time" on reductions in
operations and the introduction of new working methods. Consultation rights
cover planned structural alterations to the plant and prospective changes in
equipment and working methods that affect job requirements, all decisions
relating to manpower planning, and individual dismissals.

[1] www.eurofound.europa.eu/ef/efemiredictionary/works-constitution-0
[2] www.eurofound.europa.eu/ef/efemiredictionary/works-council-2
[3] www.eurofound.europa.eu/ef/efemiredictionary/co-determination-2

A recent decree-law issued by the Government has increased the national
minimum wage from 1 January 1997. The monthly rates have risen by up to 5%.
We review Portugal's minimum wage system and the reactions to, and
implications of, the 1997 increase.

Recently-announced plans by banks to levy service charges on the accounts
into which employees' salaries and wages are paid, have resulted in trade
union protests and the dropping of the proposals.

At its plenary session of 13-17 January 1997, the European Parliament debated
two important measures relating to employee consultation in European
companies. After the European Works Councils (EWCs) Directive was passed in
1994, the Commission published a Communication on the future of employee
consultation in November 1995, in order to revive a legislative issue which
has been under discussion in various forms for over 15 years. Its aim was to
explore whether the model used for determining the structure and operation of
EWCs could be used in a wider context as a basis for making progress with the
long-delayed European Company Statute.