New issues emerge in 1999 banking bargaining round

Negotiations over pay in the Austrian banking sector got off to a slow start in December 1998. Yet at the same time, new and important issues, such as pensions, tenure, changes to the structure of employment and new forms of marketing and service provision, are being resolved swiftly in a spirit of cooperation.

On 12 December 1998, negotiations opened for a new collective agreement for the 75,000 salaried employees in Austrian banking, due to take effect from 1 February 1999. The banks offered a pay increase of 1.1%, roughly equivalent to the rate of inflation. This position was maintained in further negotiations on 16 and 17 December, but it was rejected as unacceptable by the trade union negotiators. An agreement was expected on 26 January.

In 1998, most salaries in the sector were increased by 1.7%. However, bank employees receive an automatic increment on the pay scale every year that results in an additional increase of between 1.8% and 2%. The total average pay rise in 1998 was therefore between 3.5% and 3.7%. Inflation in 1998 was 1.3%. In the banking sector there is no difference between minimum and actual pay.

Collective agreements in banking are concluded at a subsectoral level but also partly at a provincial level, or even by individual banks. On the trade union side they are all concluded by the Money and Credit Section of the Union of Salaried Employees (Gewerkschaft der Privatangestellten, GPA), while each of the subsectors has its own employers' association. However, they are grouped together into the Credit Section of the Austrian Chamber of the Economy (Wirtschaftskammer Österreich, WKÖ). Furthermore, salaries are also all being negotiated together except for the mortgage subsector and one other banking institution, the Post Office Savings Bank (Postsparkasse, PSK) (AT9901124N), where most of the 2,200 employees are still covered by public service regulations rather than by a collective agreement.

In addition to pay, a number of other important employment issues are currently under review in banking.


Virtually the entire banking sector used to have a collectively agreed pension scheme whereby the bank topped up the state pension so that it amounted to 80% of final net pay. This regulation now remains in force only for savings banks, where it is expected soon to be replaced. The other subsectors have all switched to pension funds into which 2.5% of salary is contributed and from which a pension is paid out regardless of the state pension.


Two of the subsectors, the savings banks and the mortgage societies, have regulations on tenure. Employees, after 10 years' employment served after the age of 20, are entitled to tenure, but only 70% of a bank's employees have to be tenured. Therefore, depending on the bank's age structure, employees have had to wait for an extra four to eight years before actually being tenured. In a third subsector, the commercial banks, employees who had served 15 years after the age of 20 were entitled to a so-called administrative pension, if they were laid off. This regulation applies only to staff hired before 1995 when the necessary years of service were raised to 20.

For the mortgage societies, an agreement formally abolishing tenure is ready for signature. It will be replaced by a rule whereby employees aged over 45 with more than 15 years' service will enjoy special protection. In fact, the mortgage societies had ceased to honour the old agreement five years ago but due to the wording neither individual employees nor the trade union had a way of enforcing it in court. With the savings banks, formal negotiations are expected to start soon, though no timetable has been set. Austria's largest bank is also formally a savings bank, and it is the only one with significantly more than 70% of the staff enjoying tenure. Due to its political ancestry, it has not been spearheading the drive to abolish tenure.

The banks are increasingly avoiding tenure by forming companies that provide services to them, which are not however covered by the terms of the banking collective agreement. The GPA estimates that between 3,000 and 4,000 employees have been transferred to such outsourced operations. Many of them, though not all, have since been covered by the crafts and trades collective agreement for salaried employees (AT9811110F). While this does not provide for great differences in the pay rates themselves, it can serve to avoid: the award of automatic increments up the scale; the extra bonuses specific to each bank; and regulations on tenure where they exist.

In April 1998 one bank, on a one-year trial basis, opened a banking shop in a shopping centre. The staff are not covered by the banking collective agreement but by the agreement in commerce, whereby salaries are about 20% lower. The bank has voluntarily agreed to pay bank salaries, but the commerce agreement allows the bank shop to be open on Saturday afternoons. The trade union wants to extend the banking agreement to the banking shop while leaving its current, more liberal opening hours untouched. Negotiators are now looking for a form of words to allow only banking shops to have these longer hours on Saturday afternoons without altering the ban on regular bank branches. When a similar special agreement had to be concluded for currency exchanges at the borders, all locations were specifically named.


As one German banker said in November 1998, though banking is necessary, banks are not. Indeed, it is along these lines that the sector is undergoing a period of upheaval that has only just begun. This has forced the social partners to address a range of thorny issues with very little guidance on what the range of requirements and possibilities really is. The approach adopted is one of gradualism. The issues include the position of staff in entirely new services, such as call-centres and internet providers, who may or may not be employed by the banks, and who may not even be regular employees anymore. The banking sector is gradually being infiltrated by the business methods of the telecommunications and computing sectors, or at least this is what is expected, and these differ markedly from the banks' traditional civil service culture.

New issues also include the banks' advertising for an entirely different brand of employee. The banking shop is no place for a clerk. There is no physical place of work. The work consists of mingling with shoppers and actively promoting a range of services and products. This involves a job in communications, not one of passively waiting for the customer. Such staff, in all likelihood, are less accessible to trade unions in their current form, and are less concerned about fixed pay, fixed pensions and fixed working times, and rather more about sharing in the turnover and profits, and arranging working time to suit their individual needs. If the phenomenon spreads, which it has not yet, then it may force the trade union itself to change its approach. Highly ritualised negotiations over pay rises, while still the public part of the social partner interaction, are by comparison of minor importance. This is highlighted, perhaps, by the fact that the system of automatic annual increments up the 30-grade salary scale has not been called into question. (August Gächter, IHS)

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