Publications

Annualised hours have long been seen as a cost-efficient means of delivering
labour flexibility in industries which are subject to varying levels of
demand or which have extended operating times. The basic principle behind
annualised hours contracts is that working time is defined in terms of the
year rather than the week, so that the employer is better able to match
working time to fluctuations in demand for products and services. Originally,
it was in manufacturing industries such as paper-making and cement
manufacture where such arrangements were mostly found. Increasingly, however,
it is the service sector, such as television, finance, education and local
authorities, which is now to the fore.

This record reviews 1998's main developments in industrial relations in
Portugal

In the third quarter of 1998, the UK's GDP was 2.5% higher than a year
earlier. Balance of trade in goods was in deficit by GBP 3.9 billion,
compared with GBP 2.6 billion a year earlier. In December 1998, the all-items
retail prices index (RPI) inflation rate stood at 2.8%, down from 3.0% in
November.

In what is believed to be an unprecedented bilateral initiative between the
governments of the two countries, the UK and Spain issued a joint statement
in early December designed to influence the debate at the Vienna European
Council meeting on 11-12 December 1998 about the EU's strategy for generating
employment growth (EU9812141N [1]). The implicit intention of the declaration
appears to have been to emphasise the centrality of continued labour market
reform in boosting employment, as against the possibility of more
interventionist job-creation measures favoured by some other Member States.

[1] www.eurofound.europa.eu/ef/observatories/eurwork/articles/vienna-summit-reaffirms-employment-as-priority

On 3 December 1998, the Department for Education and Employment published a
consultative green paper, Meeting the challenge of change [1], outlining
plans for a radical reform of the teaching profession. One key objective is
the introduction of a new career and pay structure, designed to raise
teaching standards by rewarding high performance by classroom teachers. At
present, progression beyond the top of the main professional grade is
dependent not on classroom performance but on teachers taking on managerial
responsibility within schools. The government is now proposing a two-tier pay
scale for classroom teachers, with a new higher scale separated from the
existing one by a performance threshold, based on appraisal and assessment.
To cross the threshold, teachers will need to demonstrate "high and sustained
levels of achievement and commitment". Head teachers will assess and review
teachers' progress, underpinned by external assessment.

[1] http://www.dfee.gov.uk/teachers/greenpaper/index.htm

On 11 December 1998, it was announced that a ballot of union members at
Rover, the motor manufacturer, had overwhelmingly endorsed an agreement
negotiated between management and union officials involving 2,500 job losses
and more flexible working hours. The changes had been sought by Rover's
German parent company, BMW, as the price for new investment in Rover and
keeping open the Longbridge production plant in Birmingham which employs
around 14,000 people. BMW management maintained that a 30% productivity gap
existed between the Longbridge plant and BMW plants in Germany, which had to
be narrowed by means of more flexible working practices.

New research by the UK government's Office for National Statistics (ONS) uses
data from the 1998 New Earnings Survey and the spring 1998 Labour Force
Survey to produce an estimate of the number and percentage of employees
likely to be affected by the introduction of the statutory national minimum
wage (NMW) in April 1999 (UK9807135F [1]). As well as estimating the
aggregate impact of the NMW, the ONS has also analysed its impact by sex,
full-time/part-time status, region, occupational group and industry division.
The findings of the research are published in the December 1998 issue of the
official publication /Labour Market Trends/.

[1] www.eurofound.europa.eu/ef/observatories/eurwork/articles/undefined/the-national-minimum-wage-report-of-the-low-pay-commission

The election in May 1997 of a Labour government undoubtedly marked a turning
point in the long march towards a deregulated labour market in the UK. An
EIRO record written just after the election (UK9704125F [1]) reviewed the
changes in prospect, commented on their radical nature and argued that "to
suggest that [new Labour's] approach is minimalist is wide of the mark". In
terms of "headline" measures, the initial turn in direction has been rapid
indeed. The first 18 months have seen new Labour: sign up to the
Maastricht"social policy Agreement" from which the previous UK government
"opted out", resulting in new employment rights for Britain's workers; fulfil
its manifesto commitment to implement a national minimum wage; and publish
proposals to extend individual employment rights and put in place a statutory
procedure for trade unions to secure recognition by employers.
Interpretations of the impact of these measures continue to differ. Prime
Minister Tony Blair has insisted that even in the face of these measures,
"Britain will have the most lightly regulated labour market of any leading
economy in the world" (according to the /Fairness at work/ white paper).
However, Robert Taylor, employment editor of the /Financial Times/, argues
that new Labour's approach, in combination with the effects of EU membership
(now fully embraced), amounts to a "softly-softly revolution" in workplace
relations in the UK: "By the end of next year, the UK will have the most
intricate and comprehensive framework of labour legislation that it has ever
had" (/Financial Times/, 18 June 1998).

[1] www.eurofound.europa.eu/ef/observatories/eurwork/articles/undefined-labour-market/the-industrial-relations-consequences-of-the-new-labour-government

In recent years the scale of mergers and acquisitions at the international
level has risen to unprecedented heights. The United Nations estimates that
cross-border mergers and acquisitions amounted to USD 275 billion in 1996, a
three-fold increase in five years. In 1998, there have been a number of
"mega-mergers" between firms from different systems: the tie-ups between
Daimler and Chrysler (USD 41 billion) (DE9805264N [1]) and BP and Amoco (USD
48 billion) are two of the largest cross-border mergers in history.
International mergers are concentrated in North America and Europe, each
region accounting for almost one third of the sales. Within Europe, the UK is
by far the largest seller of firms to foreign multinationals: 41% of the
cross-border mergers and acquisitions in Europe in the period 1994 to 1996
involved the sale of British companies. This feature examines the
implications for industrial relations of the prevalence of international
acquisitions in Britain.

[1] www.eurofound.europa.eu/ef/observatories/eurwork/articles/industrial-relations-aspects-of-the-daimler-chrysler-merger

The end of 1998 marked a milestone in the development of the European Union.
On 1 January 1999, 11 Member States officially adopted the European single
currency, the euro (the third stage of Economic and Monetary Union, EMU). Of
the EU Member States, only Denmark, Greece, Sweden and the UK remain outside
the "euro-zone", but it appears inevitable to many observers that at least
most of these countries will join the single currency in the not too distant
future. In 1998, the impact of EMU on industrial relations was assessed more
widely than before and was the subject of keen debate for the social partners
at European, national and regional levels.