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According to a recent analysis by the Institute for Economics and Social
Science (Wirtschafts- und Sozialwissenschaftliches Institut, WSI) basic wages
and salaries in western Germany grew on average by about 2.3% in 1996. Thus,
pay increased by about 0.8 percentage points above the inflation rate, which
stood at 1.5% in 1996. Altogether, about 15.1 million employees were covered
by collective agreements signed in 1996. The highest pay increases, at 2.8%,
were in the energy and water industry and in the iron and steel industry. The
lowest increases were in banking (1.5%), post and telecommunications (1.4%)
and public services (1.3%).
In February, the Communication Workers' Union (CWU) launched a consultative
paper aimed at influencing the pre-election commitments of both the
Conservative Party and Labour Party. The union, which is firmly against
privatisation of the Post Office, has called for legislation to turn it into
an independent corporation, with the level of dividends pegged at 40% of
post-tax profits. The union feels that its proposals will have equal appeal
to all political parties because of the weight of public opinion opposing
The issue of wage flexibility as a means of promoting employment growth was
initially put forward by the ex-president of Confindustria (the most
important Italian employers' association), Luigi Abete, as a problem which
had not been adequately dealt with in the 1993 income policy agreement. CISL,
one of the three main trade union confederations, later took up the wage
flexibility issue and proposed flexibility in starting wages (the so-called
"entrance salary") as a means of tackling the extremely serious employment
crisis in some southern regions of Italy.
On 6 February 1997, the Bundesverband Druck employers' association and the
Industriegewerkschaft Medien trade union signed two new nationwide collective
agreements for the 130,000 manual workers in the German printing industry.
The first agreement covers the general developments of wages, and the second
agreement is a renewal of the sector's general framework agreement on
employment conditions  (Manteltarifvertrag).
Declining union membership and a legal and ideological attack on the role of
trade unions over the past 17 years may have left many with the opinion that
employees no longer value the right to act collectively. It has been argued
that the attack on the unions throughout the 1980s and 1990s has left the
unions weak and unable to protect members' rights. Alternatively, it has been
argued that people now prefer to negotiate their own employment contracts
individually and do not need trade unions.
The new decree, issued on 14 January, brings Italian pensions legislation
more into line with the rest of the EU. Presenting the decision to the press,
the Minister of Labour, Tiziano Treu said that "1997 will be the year in
which a real supplementary social security system will begin to be set up in
At the beginning of February the Confederation of British Industry (CBI) set
out its long term priorities for beyond the forthcoming general election. Its
director general, Adair Turner said that "whatever happens between now and
May, there are fundamental issues for business which need attention. The
changing nature of the world in which we do business brings both
opportunities and challenges, and the CBI should be at the heart of change."
On 21 January 1997, the two French electricity and gas public utility
companies signed an agreement with three trade unions ( the CFDT, the CFTC
and the CFE-CGC). This agreement is designed to improve their competitiveness
and productivity while at the same time maintaining their workforce at
current levels. This is to be achieved mainly through the introduction of
part-time working. Both the CGT and the CGT-FO unions are strongly critical
of this agreement.
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