Czech Republic: Latest working life developments – Q4 2017

New employment strategies to address labour shortages, the post-election political shift in the Chamber of Deputies and an award-winning documentary on working conditions are the main points of interest in this article. This country update reports on the latest developments in working life in the Czech Republic in the fourth quarter of 2017.

Employers’ new recruitment strategies

The Czech economy is growing faster than at any time in the last 10 years. The most recent estimate of GDP growth for the second quarter of 2017 is around 5% and this growth has been accompanied by average wage increases of about 7.5%. Unemployment rates are at a record low of 3.5%, according to Labour Office statistics.

This has led to a labour shortage and employers have had to rethink their recruitment strategies. Until recently, employers were focusing on recruiting cheaper labour from Ukraine or from countries that had more recently joined the EU, such as Bulgaria and Romania. However, in spite of government programmes to make the employment of Ukrainian workers easier, the administrative process continues to be complicated and time-consuming. Czech employers have, therefore, begun to focus on hiring labour from EU countries such as Greece, Italy and Spain where there is more likely to be a surplus of skilled and trained labour. However, the workforce from these countries has significantly higher wage expectations and other costly needs, such as the provision of accommodation.

New post-election environment for social dialogue

The October 2017 general election for the Chamber of Deputies of the Parliament of the Czech Republic fundamentally changed the political makeup of the Chamber, as the traditional parliamentary parties failed to capture a significant share of the vote. The ANO movement led by Andrej Babiš, a businessmen and the owner of several media outlets, came first with 29.6% of the vote, followed by the Civic Democratic Party (ODS) with 11.3% and the Czech Pirate Party with 10.8%. The Social Democratic Party (ČSSD), winner of the highest proportion of the vote in the previous election, won only 7.3%.

The ČSSD’s term of office could be described as a golden period for social dialogue, with regular meetings and negotiations between the various social partners at the highest level during a period of economic success and rapidly increasing pay. However, the social partners, including the trade unions, do not appear to be concerned about whether a new pro-employer government will end this approach. They expect the respect and trust established during the previous government’s efforts to encourage social reconciliation will be maintained, and that wage growth will continue to be sustained with the support of economic prosperity.

The trade unions have also made it clear that they hope the Czech Republic will remain firmly embedded in Euro-Atlantic structures. The employers’ representative body, the Confederation of Industry of the Czech Republic, believes the new government has the potential to establish more favourable conditions for the employment of foreigners (especially Ukrainians and Romanians) for sectors that have labour shortages.

Looking forward, however, it must be assumed that the level of social dialogue will change. Neither the willingness of the new government to engage in social dialogue nor the level of involvement of the various social partners in balanced discussions is likely to match that achieved by former Prime Minister Bohuslav Sobotka and his government.

Award for working conditions documentary

The documentary film The Limits of Work draws attention to the working conditions of five low-income jobs (working in a hospital laundry, a chicken processing factory, waste sorting plant, razor blade factory and in a supermarket as a cashier). The jobs were selected because, despite their low status and poor pay, these roles deliver valuable services to much of society. The film follows Alexandra Uhlová, a journalist, anthropologist and expert on Roma issues, as she works in each role for several months at a time. Her commentary examines why it is difficult for these workers to organise themselves or join trade unions so that they can negotiate better working conditions and pay. Ms Uhlová also uncovers Labour Code violations in four of the five jobs she takes on.

The film premiered on 26 October 2017 at the Jihlava International Documentary Film Festival where it won the prize for best Czech documentary. It was also widely discussed in the media and even formed the subject of discussions held during the campaign preceding the Czech presidential election in January 2018.

Working conditions were also the focus of the Association of Independent Trade Unions’ international conference on 15 November 2017, the theme of which was ‘The impacts of the digitalisation of work on the employment, collective bargaining and social security of employees’. Conference sessions included a presentation of expert studies on the impact of the shared economy on the position of employees, discussion of the need to reform the education system in response to the Industry 4.0 initiative, and consideration of the challenges presented by distance working.


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