New wage agreement for the public sector

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New wage agreements were reached on 25 May 1997 covering the Norwegian state sector, the municipal sector and the municipality of Oslo. The new agreements include a voluntary early retirement scheme for the age-group from 62-63 years and moderate wage increases. The wage settlement for the public sector is therefore in line with the settlement in the private sector with regard to total wage growth.

On Sunday 25 May, wage bargaining for the public sector was concluded after all the parties were able to recommend the State Mediator's outline agreement for the three bargaining areas - the state sector, the municipal sector and the municipality of Oslo. The majority of the bargaining cartels have already accepted the settlement.

The wage settlements in the public sector cover more than 600,000 employees and involve three different wage agreements. On the employers' side we find the state, the Norwegian Association of Local Authorities (KS) and the municipality of Oslo. Within each of these areas the employee organisations are joined together in three bargaining cartels which stem from the three union confederations. The three agreements have many features in common, a situation which requires a significant amount of coordination during bargaining.

The most central issue in this year's bargaining round, was the question of the agreement-based early retirement scheme. The two largest bargaining parties on the employer side, the state and KS, had differing views with regard to what type of scheme the agreements should include. While the state wanted a scheme which resembled the one the Norwegian Confederation of Trade Unions (LO) and the Confederation of Norwegian Business and Industry (NHO) had agreed in the private sector (NO9704108F), KS proposed an alternative scheme. Although the employee side preferred the KS proposal, the Prime Minister made it clear that the Government would not support an early retirement scheme which was distinct from the LO-NHO scheme. For this reason, KS in the end accepted the LO-NHO scheme.

The new agreements provide public sector employees with an annual wage increase of NOK 2,500. In addition, employees with an annual salary under NOK 200,000 will receive a supplementary increase. Funds have been set aside for local bargaining in both the state and the municipal sector. Within the state sector, women are to have a larger share than a pro rata distribution would entail. In the agreement for the municipal sector it is stipulated that the local increases "shall attach greatest importance to low incomes and equal pay".