LO union and Christian employers negotiate collective agreement

In January 2004, it was announced that the Trade Union of Public Employees (FOA), an affiliate of Danish Confederation of Trade Unions (LO), is negotiating with the Association of Christian Employers (KA) over a collective agreement covering the latter's members providing private care services for elderly people. This is an unprecedented move for an LO member union. One of the conditions for an agreement stipulated by KA is that both sides should renounce the right to take industrial action. This has brought heavy criticism of FOA from other LO unions, which regard the right to take industrial action as one of the cornerstones of the Danish collective bargaining model.

Since October 2003, the Trade Union of Public Employees (Forbundet af Offentlige Ansatte, FOA) and the Association of Christian Employers (Kristelig Arbejdsgiverforening, KA) have been in contact for the purpose of concluding a collective agreement. Until now, it has been unheard of that unions affiliated to the Danish Confederation of Trade Unions (Landsorganisationen i Danmark, LO) would have any dealings with what they regard as a 'yellow' Christian organisation, in the light of many disputes with it over the years. The reactions of some of the other LO trade unions were strong when it was announced on 23 January 2004 that FOA and KA were negotiating a collective agreement.

'Free choice' scheme and coverage of collective agreements

The process that led to negotiations between FOA and KA started with the introduction of a so-called 'free choice scheme' in the sector of care for elderly people, which gave individuals a choice between public and private home care services. This led to the emergence of a new market, which is dominated by small private care enterprises, with major companies such as ISS Danmark not entering the field. In the majority of municipalities, the development has been rather slow, but a number of enterprises - probably around 300 - have entered the market. Most of them are not members of employers' organisations, but others are organised in the Danish Chamber of Commerce (Handel, Transport og Serviceerhvervene, HTS), while some larger firms are members of Danish Commerce and Service (Dansk Handel & Service, DHS) and, finally, some enterprises have joined KA.

Although the free choice model has got off to a rather slow start, FOA sees it as important to gain representation in the new private elderly care sector as it may, in the longer term, turn out to be a relatively important part of the services sector. FOA has thus concluded a collective agreement with the Association of Employers in the Services Sector (Servicebranchens Arbejdsgiverforening, SBA), which is part of HTS. This involved an extension of the existing public sector collective agreement for the care sector to a relatively small number of small enterprises. Similarly, FOA has concluded an agreement with DHS, which also mainly represents small enterprises in this sector, with a relatively low number of employees overall. With these two agreements, FOA thus covers about 100 enterprises, or one-third of those current involved in the private home care sector. Furthermore, FOA has tried to conclude 'adoption agreements' with the many unorganised enterprises (whereby they agree to apply the terms of the sectoral agreement).

These various initiatives have not led to satisfactory bargaining coverage, in FOA's view. The main problem is that many enterprises in the new private elderly care sector are joining KA ,which may thus turn out to be an important actor in this industry. This means that FOA has a serious problem with obtaining wide-ranging representation in this sector. Furthermore, FOA members are not very used to taking industrial action, which might be necessary to obtain agreements. Moreover, a new firm in the sector has concluded a collective agreement with the independent Christian Trade Union (Kristelig Fagforening, KF) (DK9811195N) which meant that FOA members in this firm were covered by this agreement and some members subsequently jointed KF. FOA managed to stop this development through the threat of a boycott of the firm. With further similar disputes emerging in the new private elderly care sector, KA contacted FOA suggesting that it might be possible to settle such disputes by concluding an agreement. FOA did not reject this idea.

Basis for an agreement

Negotiating such an agreement is not an easy process, as the two sides have widely differing traditions and sets of values. For example, FOA will not accept the existence of parallel agreements with the KF union in the same sector, but it may be difficult for KA to conclude agreements only with FOA, as it is stated in the 'basic agreement' between KA and KF that KA may only conclude agreements with KF. This can be circumvented by KA setting up a new division or unit. This seems to forebode an internal fight in the close-knit Christian movement.

FOA faces similar dilemmas. KA's demands over a possible agreement will include a provision that the special set of values of the employing organisations are preserved. This means that any agreement would exclude the possibility of closed-shop agreements (DK0207103F). This is not a crucial point for FOA, as the main parts of the public sector it covers do not have such clauses and this is also the case for recent FOA agreements in the private sector. FOA thus has a tradition of not having closed-shop provisions in its collective agreements.

The other condition which follows from KA's values is far more problematic for FOA, as it is in direct conflict with the values on which the trade union movement is based. This is a demand that there should be no right to take industrial action under the agreement. As a precedent, KA refers to the cooperative sector's basic agreement and the agreement with COOP Denmark, in which LO has accepted the absence of the right to take industrial action. However, this has been agreed by LO in fields which are ideologically related to the trade union movement. This reservation will now have to be reconsidered.

It is thus difficult for FOA to accept KA's demands. However, its wish to bargain for a new sector - and one whose employees are not used to taking industrial action - is so great that FOA has not flatly rejected KA's demands. It is obvious that a completely unrestricted peace obligation will not be acceptable to any trade union. FOA has thus been seeking to clarify in its contacts with KA and in its own internal discussions what the absence of a right to take industrial action will actually mean. FOA may seek to ensure that it may terminate the agreement when it is to be renegotiated, thus enabling industrial action. KA will probably have to accept this.

As regards the content of an agreement between FOA and an organisation under KA, it is expected that it will be an unconditional requirement for FOA that the enterprises covered by such an agreement will not have cheaper labour costs than private enterprises covered by other agreements in the sector and the municipal care services for elderly people which are covered by the public sector agreement between FOA and the National Association of Local Authorities in Denmark (Kommunernes Landsforening, KL). For FOA, the pivotal point and the basis for comparison will necessarily be the public sector agreement, as this agreement covers the great majority of its members in the entire care sector.

Angry reactions from LO unions

FOA is the third-largest union affiliated to LO (and in Denmark). Its president, Dennis Kristensen, is a controversial figure in the trade union movement, and the present case has further contributed to this reputation. It is, after all, a risky business to negotiate over a cornerstone of the trade union movement, the right to take industrial action, with a traditional 'enemy' which was set up by the evangelical wing of the Church of Denmark in 1899 as a reaction to the establishment of LO. The second-largest LO union, the General Workers’ Union (Specialarbejderforbundet i Danmark, SiD) has reacted strongly and accused FOA of abandoning basic values in an 'egocentric' search for new members. SiD has thus postponed negotiations with FOA in a union demarcation case concerning which of them should organise bus drivers in Copenhagen (DK0302102F). Others have expressed the view that an abandonment of traditional trade union values by FOA may, in the longer term, contribute to a disintegration of union membership. FOA's action is - in the opinion of the critics - a serious attack on the principle of solidarity. The president of LO, Hans Jensen, has been less radical in his comments, but it remains a fact that this case is a very sensitive one.

Commentary

FOA is facing a choice between a tactical effort to obtain control over a new sector and a partial renunciation of principles which have until now been fundamental for the Danish trade union movement. However, to take the first option does not necessarily imply that all principles are set aside. It could be considered whether the right to take industrial action, as it has functioned until now, meets the conditions in modern society from the point of view of the trade union movement. The experience of disputes in, for instance, the public sector during the last decade has shown that the right to take industrial action, especially in the care sector, is a virtually useless instrument as it is not seen as acceptable to suspend care for the people concerned. One could not imagine any major dispute in the field of care for elderly people.

Could such an agreement as currently mooted be seen as a signal that FOA has given up the fight against the Christian trade union movement and employers' association? This would undoubtedly be the opinion in some circles within the LO part of the trade union movement; but one might also turn things the other way round and raise the question of whether it is not the Christian organisations which are giving in? It is perhaps more KA than FOA which seems to be following the principle of 'if you can’t beat them, join them'. Maybe the efforts of both the Christian employers' and trade union organisations to go outside their own narrow field can be seen as an effort to expand, but it also creates a split between organisations that used to be closely knit together. Maybe in the longer perspective, KF and KA will be assimilated in the ordinary collective bargaining system. An agreement between KA and FOA could perhaps contain the KF union’s potential for recruiting new members (Carsten Jørgensen, FAOS)

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