New agreement concluded for employees in the state sector

A new three-year agreement was concluded for the about 160,000 employees in the state sector by end of February 2005. The main results were a modest improvement in real wages and a wage guarantee in connection with the up-coming local government reform. As a new element in this bargaining field, the state has an introduced a special integration wage for immigrants in order to facilitate their labour market integration.

By end of February 2005, the negotiating parties in the state sector, the The State Employers' Authority, (Personalestyrelsen) an agency within the Ministry of Finance, and the employees’ organisations’ bargaining unit, the Danish Central Federation of State Employees (Centralorganisationernes Fællesudvalg, CFU) concluded a new three-year agreement. The 160,000 employees obtained an agreement which is very similar to the agreement concluded in the municipal/county sector a few days earlier.

The wage framework is 6.96%, i.e. a general wage increase of 5.76% over a period of three years; only 1.20% of the wage increase has been earmarked for negotiations with the individual employees under the new wage system, 'Ny Løn'. In the municipal/county sector, a more flexible model of the new wage system was chosen which makes it possible to earmark up to 2.5% for individual wage negotiations; this is what the Union of Commercial and Clerical Employees in Denmark (Handels- og Kortorfunktionærernes Forbund, HK/Kommunal) chose to do.

Also the protection of the employees in connection with the implementation of the local government reform resembles to the letter the scheme that was introduced in the municipal/county sector. Employees whose jobs are changed after the reform will maintain their present wage up to April 2008; then the wage may either be gradually reduced over the following three years or frozen until the wage of the employee concerned is at the same level as that of the colleagues.

As regards the issue of dismissals - where the employees had also wished to have a special protection guarantee - the agreement for the state employees also just includes a recommendation to the effect that staff reductions should, where possible, take place in the form of natural wastage. i.e. no proper guarantee.

As a quite new element the agreement includes an integration clause. The agreement contains a provision to the effect that persons with a different ethnic background may be employed for up to 12 months at a wage corresponding to 80% of the contractual initial wage. In return, 20% of the working time will be reserved for training and up-grading of skills. The hope is that these jobs will ease the way into the labour market for immigrants and give them practical work experience. It has earlier been attempted to introduce similar schemes in Denmark, but the attempts have failed in the bargaining process. It is thus the first time that the trade unions accept a provision that deviates from the standard contractual wage in specific fields. Both bargaining partners express their confidence that the system will work according to the intentions and that the individual employees will on the expiry of the 12-months period be transferred to the standard wage applying to the job in question.

Another question is that there should be more trainees in the state sector with a different ethnic background. Today, the percentage is 10%, corresponding to 1,300 persons. The target is to increase this share to 25% up to year 2007, so that the number will be about 1,600 trainees with a different ethnic background.

Other important elements of the agreement will, in particular, benefit families with small children. Both parents will be granted two extra special care days per year during the first seven years of the child’s life. Pension payments will take place during the entire period of maternity leave. Finally, parents will have a right to paid absence from work if their child is hospitalised.

The agreement also contains a new, simplified working time agreement for some groups of public employees. This agreement means that more matters will now be negotiated at the local level. Finally, there is an increase in the funds for training and up-grading of the skills of employees in the state sector.

This information is made available through the European Industrial Relations Observatory (EIRO), as a service to users of the EIROnline database. EIRO is a project of the European Foundation for the Improvement of Living and Working Conditions. However, this information has been neither edited nor approved by the Foundation, which means that it is not responsible for its content and accuracy. This is the responsibility of the EIRO national centre that originated/provided the information. For details see the "About this record" information in this record.

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