Norway: Nordic model not used to its full potential at company level

The Nordic model, a term used partly to describe the system of cooperation between workers and employers, is considered a success. However, according to data gathered by Fafo, the Norwegian research institute, the scope of cooperation between Norwegian social partners at company level varies and that the potential of the Nordic model is not fully exploited at the workplace.

Background and methodology

The Nordic model is a term used to describe the welfare state and the system of cooperation between workers and employers. It is considered a success, as the Nordic countries score better than other European countries on indicators such as economic development, employment and relations between the social partners. In a time of economic crisis in Europe, the model has received renewed attention.

The success of the Nordic model at the macro level is well documented through research, but there is less knowledge of how trade union representatives and employers collaborate in practice at the workplace. Previous research on local-level cooperation has mainly covered large manufacturing companies and has contributed less to the understanding of what is going on in smaller companies and in other industries. Union representatives are one of the key components of the Nordic model, as they are responsible for protecting the interests of their members, as well as representing them while executing co-determination rights at the workplace. The aim of co-determination is to make the companies run efficiently and to safeguard jobs.

In order to understand the Nordic model at company level, it is important to look at the quality of the cooperation between union representatives and the employers of a company, the focus of a study conducted by Fafo between 2013 and 2015. In this study, the researchers surveyed union representatives in three trade unions affiliated to the Norwegian Confederation of Trade Unions (LO), of which 1,782 representatives answered the survey. The researchers also interviewed union representatives and employers in 33 companies. The research was not an attempt to substantiate whether the cooperation between the social partners at company level has improved or deteriorated over time, but an attempt to depict how the situation is today. Commissioned by LO, the research covered several of its affiliated trade unions representing manufacturing, construction, hotels and restaurants, and the retail trade.

Variations in how well the Nordic model is embedded at the workplace

The main result of the research is that the scope of cooperation between the social partners at the company level varies depending on sector, the number of employees and union density within the company.

The Nordic model is well embedded in many workplaces, with relations between the social partners characterised by trust and respect, regular communication and exchange of information. Many trade union representatives report that the cooperation works well at company level, though almost three out of ten representatives have neither formal nor informal talks with their employer on issues related to their role as shop steward. This indicates that the potential of the Nordic model at the workplace is not fully utilised.

Union representatives in the retail trade and in hotels and restaurants have the fewest meetings, formal or informal, with employers. Fewer workers are organised in the retail trade and in hotels and restaurants than in manufacturing, and this means that the Nordic model is less embedded in companies where few workers are organised. Union representatives in manufacturing and construction participate more frequently in meetings and conversations with their employers.

The potential of the model is not fully utilised

The results from the survey indicate that there are many unused tools available at local level, such as rights and institutions derived from collective agreements and the Working Environment Act. Three out of ten union representatives did not use the tools they were given to participate in cooperation at local level. These tools might be important to ensure workers’ participation and influence in challenging situations, as in downsizing or restructuring processes.

The results also indicate that institutions established by agreements, such as works councils, are less widespread than institutions established by law. Companies with more than 100 employees are obliged by collective agreements to have a works council. However, according to the union representatives surveyed, only 37% of these companies actually have one.

The research indicates that many union representatives would like more training and discussion around central issues of cooperation, such as wages and working hours. This is particularly so for union representatives in the retail trade and in hotels and restaurants. The union representatives also report that employers could need significantly more training than they do. This view is shared by the interviewed employers.

Union representatives need assistance to perform their tasks and develop competence in trade union work, especially as many union representatives in the survey are new to their role. There are differences between sectors in how good the employers are at facilitating trade union work. Over half of the union representatives within industry say that their company facilitates trade union work. The corresponding share in the retail sector is only 20%.

Robust relationships important in times of crisis

In workplaces where there are regular meetings between union representatives and managers, both parties say that this is important in order to build trust. Even though the two parties might not have any major issues or conflicts to discuss in day-to-day working life, the two parties should meet to exchange information. This could contribute to a more robust relationship, which helps when the two sides face with challenging situations.

The absence of formal meetings does not necessarily mean that the relationship between employers and employees is poor. An important aspect of the Norwegian working life model is informal cooperation and trust between the social partners. More than half of the union representatives surveyed said they have informal meetings with the employers every month, or more. The researchers indicate that the cooperation between the union representatives and the employers might be revived in times of crisis, but this depends on several factors and is not certain.

Commentary

The Fafo report is an important contribution to the literature on the Nordic model. It explores how the collaboration between union representatives and managers plays out at the workplace, and sheds new light on the Nordic model at micro-level. The main findings are that the scope of cooperation between the social partners at company level varies and that many tools in the collective agreements (and in the law) are available to the social partners at local level but are not used. In times of crisis, it is important that both parties understand how to use these tools in order to cope better with any challenges.

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