Conference examines social pacts

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In November 1999, a major conference examined social pacts and concertation in Portugal. The debate covered issues such as the importance to the social partners of being involved in the process, the use of pacts as a political tool, the low level of influence pacts have had in changing industrial relations, and their enormous potential to produce social and macroeconomic results.

In November 1999, a conference entitled Reform of the social pact (A reforma do pacto social), was held on the initiative of the Office of the President of the Portuguese Republic. The conference was designed to promote debate among the social partners and labour law and industrial relations experts. Speaking at the conference, the President stated that the issue at stake is that of reconciling business competitiveness with "European social citizenship".

The debate centered around a number of key issues:

• discussion of the "European social model" and the role of the social partners in this context; and

• discussion of the possibility and/or necessity to negotiate a new social pact in Portugal, since the 1996-9 tripartite Strategic Concertation Pact (Acordo de Concertação Estratégica) has now drawn to a close (PT9808190F). In this context, it is seen as important to pay careful attention to the experiences of other EU Member States.

The most interesting feature of the debate was the general awareness that something new is happening in Portuguese industrial relations with regard to the two points mentioned above. Discussion has come up numerous times on making more profound amendments to Portuguese labour law, and changing the paradigm of industrial relations and the mechanisms and functioning of collective bargaining at the various levels, but nothing substantive has ever come out of it, although since 1984, Portugal has had several social pacts and social concertation policies.

At the conference, the social partners made a number of contributions stressing the importance of social pacts at the current moment.

Employers at the conference underlined that:

• their involvement in concertation was important in order to be able to apply pressure for tax reform - according to the Portuguese Confederation of Industry (Confederação da Indústria Portuguesa, CIP) - and on other key topics in government policy - according to Portuguese Confederation of Agriculture (Confederação Portuguesa da Agricultura, CAP);

• historically, concertation agreements have been politicised and have constituted agreements between the two main parties - the Socialists (PS) and Social Democrats (PSD) - to control inflation;

• CIP believes that social concertation is a complex system controlled by the state;

• concertation has not led to better definition of employment conditions and regulations. Because the trade unions in some areas are "monopoly holders", by virtue of the Conititution, the employers argue that agreements are not complied with by all nor are they applied at the workplace. Thus, there are increasing obstacles to the regulation of work, which leads to "wildcat" regulation, which in turn results in unfair practices; and

• in Portugal, social pacts have introduced some innovation, but this innovation was not followed through because parliament took on the responsibility of legislating in the area of labour. This was a commitment made as part of the 1996-9 Strategic Concertation Pact.

The trade union confederations spoke primarily about the "relations" that are created in employment and focused on the need for a "distribution option" in collective bargaining within the current framework of growth, competitiveness and employment.

The General Confederation of Portuguese Workers (Confederação Geral dos Trabalhadores Portugueses, CGTP) called for a commitment to "give greater value to work" to be adopted in the future. Over the last 15 years, only rarely (in concertation on vocational training and health and safety) has CGTP been willing to make broad commitments. It believes that the 1996 agreement - which it did not sign - presupposes flexibility in relation to labour law. The confederation also stated that collective agreements, social dialogue and tripartism should be kept separate, and that bilaterality should prevail in labour relations.

The main arguments put forward by General Worker's Union (União Geral de Trabalhadores, UGT), which has signed Portugal's social pacts, were that:

• concertation has made a major contribution toward lowering inflation in Portugal;

• during the years in which there has been a central agreement, the number of workers covered by collective bargaining has increased (by 17%, or more than 1 million workers, in four years), while industrial conflict has decreased; and

• in real terms, pay has risen by 3.6% on average in years when there has been no central agreement, whereas increases have averaged 4.6% in years when there has been an agreement.

According to UGT, concertation should be kept up and can serve to motivate collective bargaining.

Both social partners mentioned that a lack of bilateral contacts between them has had a negative impact.

At the closing session, the President spoke of the need to adapt the system of industrial relations to economic and social change. He also underlined the need to maintain work as the pivotal point of social life and said that participatory democracy must constantly be brought into line with the rules of a state governed by the rule of law. The President also highlighted the need to coordinate social concertation agreements with developments in collective bargaining and said that current changes in labour relations in the various Member States should be coordinated at the European level.