Bargaining increases working time flexibility

Download article in original language : ES0305203FES.DOC

In its annual review of collective bargaining, published in spring 2003, the Spanish Confederation of Employers' Organisations (CEOE) highlights the increasing tendency for agreements to introduce more flexible working time. This includes measures such as annualisation, daily flexibility and irregular distribution of working time over the year.

The Spanish Confederation of Employers’ Organisations (Confederación Española de Organizaciones Empresariales, CEOE) published the findings of its 2002 company survey on collective bargaining in spring 2003 (Balance de la encuesta de CEOE sobre la negociación colectiva 2002. Estructura y contenido de los Convenios Colectivos en España[Evaluation of the CEOE survey on collective bargaining in 2001. Structure and content of collective agreements in Spain], Informes y Estudios No. 89. CEOE, Madrid). This is a panel study that follows the development of collective agreements on a yearly basis (ES0206208F). On this occasion, we focus on the survey's findings on working time, which is becoming an increasingly important issue in collective agreements. A major trend appears to be that 'qualitative' aspects - ie the flexible distribution and organisation of working time - are gaining importance over 'quantitative' ones - ie the number of hours of work. The context is that the major labour market reform of 1994 allowed the content of collective bargaining to be extended. In the area of working time, this covered issues such as the irregular distribution of working time over the year and the conception of working time as an element of efficient and flexible management (ES0107152F and ES0108157F).

Basis for calculation of working time

Article 34 of the Workers' Statute (Estatuto de los Trabajadores, ET), gives precedence to collective bargaining in establishing the basis for the calculation of working time (eg daily, weekly, annual etc) and provides that the duration of working time should be laid down in the collective agreement or in the individual employment contract.

The annualisation of working time in collective agreements is becoming more and more important each year. According to the CEOE survey, 52% of collective agreements now state that working time shall be exclusively calculated on an annualised basis. The figure is 68% for company agreements and 50% for national sectoral agreements. However, 20% of the agreements analysed still provide for a weekly calculation of working time, whereas 25% establish a dual system of annual and weekly calculation of effective working time. According to CEOE, the annual/weekly formula introduces rigidity because it limits the irregular distribution of working time over the year. In summary, the authors of the study state that the implementation of annualised working time and a more flexible distribution of hours almost always requires company agreements. This is why many sectoral agreements refer to bargaining at lower levels.

Daily working time

Article 34.3 of the ET establishes that the number of normal hours of effective work may not be greater than nine hours per day unless a collective agreement - or failing that an agreement between the company and the workers' representatives - establishes a different distribution of working time, which must in all cases respect the rules on rest periods between working days. In line with this legal limit, the CEOE survey finds that 39% of collective agreements regulate the maximum number of hours of work per day. The average number of daily hours laid down in collective agreements is eight hours 32 minutes.

The daily distribution of working time may be continuous or split. Continuous working time is laid down in 65% of collective agreements, and over half of the workers covered (54%) work a continuous day. According to CEOE, this contributes to the reconciliation of work and family life, though a more detailed study of this subject is needed.

Another important aspect of the daily distribution of working time is the use of flexible timetables, or flexi-time. This involves dividing daily working time into three parts: a) an initial flexible period at the beginning of the working day; b) a common core period (consisting of about two-thirds of the daily working hours); and c) a final flexible period at the end of the working day. The flexible timetable is becoming more common, though mainly in agreements at company level, 40% of which provide for this possibility. However, flexible timetables affect only certain departments or sections (such as marketing) or certain occupational categories or levels (management, technical staff etc). Overall, this system is far from widespread, with only 20% of collective agreements providing for it.

Night work

Given the more arduous nature of night work, collective bargaining establishes specific higher pay rates for it, unless the employees' basic pay is set bearing in mind that the work is to be done at night due to its nature, or compensation through time off in lieu is agreed. The CEOE survey finds that 49% of the collective agreements analysed establish higher specific pay rates for night work. The hourly pay for night work is 23% higher than that for day work. However, compensation for night work in the form of time off is still marginal, dealt with in only 2% of agreements.

Worker availability

Worker availability outside their normal hours has been developed as an instrument of flexible work organisation, in order to deal with unpredictable situations in companies, such as unforeseen orders or delays in production. According to CEOE, this subject is dealt with in 27% of collective agreements at company level and in 4% of sectoral agreements.

Irregular distribution of working time

Article 34.2 of the ET offers the possibility that a collective agreement - or failing that a company agreement with workers' representatives - may establish the irregular distribution of working time over the year. The only limits are the nine hours per day and 40 hours per week established by law.

The CEOE survey finds that 36% of collective agreements include some system allowing for the irregular distribution of working time. This possibility is included in 62% of national sectoral agreements, which tend to refer bargaining on this subject to the company and workplace level. The agreements include a variety of formulae for achieving the flexible distribution of working time. These include clauses that:

• provide for shorter working time in certain months of the year, normally in the summer, balanced by longer working time the rest of the year;

• establish the possibility of irregular distribution of working time in certain circumstances. This is at the discretion of the company management in many cases;

• allow irregular distribution at the discretion of company management, but set limits for such changes to work schedules;

• create 'pools' of a certain number of hours to be worked flexibly per year at the company's behest. These form part of annual working time, even if the working time is irregular. Workers can be required to work these hours in line with the technical and organisational needs of the company; and

• allow for the possibility of irregular distribution of working time subject to control by the workers' representatives in the company. These clauses may establish a right for representatives to non-binding information and consultation, or provide for a specific agreement with the workers' committee or the workers' representatives.

Overtime

Article 35 of the ET establishes that overtime is voluntary, unless it is laid down in the collective agreement or individual employment contract. The limit of overtime is 80 hours per year. The 1997 intersectoral agreement on collective bargaining (ES9706211F) provided for the reduction of overtime, and its compensation with time off. The criteria, the amount and the distribution of compensation should be developed in the company agreements. According to the CEOE data, in practice the treatment of this issue in collective agreements has varied greatly, as follows.

1. Compensation for overtime. Many sectoral collective agreements (47%) give priority to compensation for overtime through time off. However, compensation through time off is included in only 30% of company agreements. Different formulae are used, the most important being mixed ones, which combine pay with time off. Sometimes the number of hours of overtime and time off is quantified.

2. Reduction or elimination of overtime. References to the reduction or elimination of overtime in order to create employment appear in only 27% of collective agreements, and are more common in sectoral agreements (38%). Sufficient progress does not seem to have been made on this point.

Working time reductions

The average collectively agreed annual working time in 2002 was 1,763 hours. Sectoral agreements provided for an average annual working time of 1,765 hours and company agreements an average of 1,724 hours. The average agreed working week was 37 hours 54 minutes in company agreements and 39 hours 8 minutes in sectoral agreements. In general, it can be observed that annual working time has been reduced gradually and moderately since 1996 in both sectoral and company agreements, with the former making greater reductions.

Annual leave

Little attention was paid to the regulation of annual leave in the 1994 labour reform. However, in general, collective bargaining complements the legal regulations. Article 38.1 of the ET establishes a minimum annual leave period of 30 calendar days. The average annual leave provided for by collective agreements is slightly higher, at 30.3 calendar days or 23 working days. Some 6% of agreements provide for slightly longer annual leave in line with seniority.

Commentary

The CEOE report concludes that 'the figures confirm a tendency towards increasing flexibility, combined with the presence of signs that indicate the need to intensify bargaining efforts'. Working time has become a variable for adjusting and reducing costs, particularly since the symbolic agreement on working time reduction and flexibility signed in 1993 at Volkswagen in Germany. This policy of more flexible working time is promoted by company managements and is seen as a 'lesser evil' by the trade unions in order to save jobs.

However, two of the main objectives pursued by the trade unions - the reduction of working time and the reduction of overtime - do not seem to have progressed greatly in collective agreements, according to the figures. The amount of overtime has hardly fallen. It is now compensated partly with time off and partly with pay. In a low-pay country like Spain, the preference of workers for paid overtime is an obstacle to further progress in job creation. (Antonio Martín Artiles, QUIT-UAB)