New national collective agreement signed for 2006–2007

In early April 2006, Greece’s central social partner organisations signed a new national general collective agreement for the private sector, following months of intensive bargaining. The agreement sets minimum wage as well as salary increases, and regulates other non-pay issues for the next two years, 2006–2007.

On 12 April 2006, a new National General Collective Agreement (EGSSE) was concluded by the Greek General Confederation of Labour (GSEE) and the Federation of Greek Industries (SEV). The new two-year agreement covers the period 2006–2007.

Main provisions of agreement

The agreement provides for increases in the minimum wages of private sector workers nationwide. The salaries and wages will be increased in three instalments: by 2.9% coming into effect retroactively from 1 January 2006, by a further 2.9% from 1 September 2006, and by 5.1% from 1 May 2007. The new minimum levels of salaries and wages were set as follows:

Minimum levels of wages and salaries (€), 2006–2007
Minimum levels of wages and salaries (€), 2006–2007
. 1 January 2006 1 September 2006 1 May 2007
Unmarried blue-collar workers with less than three years of service* 27.18 27.96 29.39
Unmarried white-collar workers with less than three years of service** 608.32 625.97 657.89

Note: * Wage per day; ** Wage per month of salaried employees. The impact of the marital status in pay determination has not been a matter of dispute as it is established by the national labour law.

Source: EGSEE 2006–2007

The new EGSEE also provides for an increase in severance pay amounting to five days’ pay for blue-collar workers who have completed 25 to 30 years of service and for those who have completed 30 years or more of service.

In comparison with the national collective agreements of previous years (GR0409102F; GR0204109F), the new EGSEE does not include as many new provisions on employment conditions and social issues. For example, working time arrangements – also an issue of great importance – are not covered in the new agreement. The 2006–2007 EGSSE provides for general agreements with regard to: the implementation of telework in line with the relevant EU framework agreement (109Kb PDF) concluded by the EU-level social partners in July 2002; greater autonomy for employees in employment and vocational training; family support and promoting female employment; and vocational education and training.

Difficult bargaining process

Overall, the negotiations for the 2006–2007 EGSSE were characterised by intense conflict between the social partners. Several national industrial actions went ahead during the bargaining process. At the same time, a major public debate arose over the extent of the unions’ demands and the value of collective bargaining at national and sectoral levels in light of the following developments:

  • the failure to sign an industry-wide agreement in the banking sector due to the employers’ preference to go ahead and sign company-level agreements (GR0602105N);
  • the decision to impose civil conscription in an effort to terminate industrial action initiated by the country’s maritime workers (GR0603019I).

Moreover, the bargaining climate had already been exacerbated by government commitments to implement substantial changes to employment conditions in public utilities and services, which will also affect the permanent employment status of civil servants (GR0606049I). Further government policies also impacted negatively on the bargaining process, including the recent legislative measures concerning working time and shop opening hours, as well as the content of the new tax framework and the rate of value added tax (VAT). The unions see these interventions as being socially unfair and one-sided, in the sense that they transfer the burden of the reforms aimed at improving the country’s economy onto the workers, without providing them with incentives to offset these supplementary charges.

In this context, GSEE underlined that these reforms will result in:

  • fewer jobs and reduced income for a substantial proportion of workers to the advantage of entrepreneurs;
  • more widespread insecurity among young people, partly due to the division and fragmentation of people being employed under the ‘old’ and the ‘new’ code in public utilities and services;
  • greater job insecurity for civil servants as a result of the restructuring of the public administration.

Views of the social partners

Despite the tensions, GSEE entered the EGSSE bargaining round making it clear that reaching agreement should not be influenced by important issues of another type, such as unemployment and the competitiveness of the country’s economy. Following the first meeting, GSEE pointed out that minimum wages in Greece, which are among the lowest in the EU15 with the exception of Portugal and Spain, are not to blame for the negative results of the Greek economy in terms of unemployment and competitiveness.

Conversely, SEV claims that there has been a major increase in unit labour costs in Greece over the past few years compared with that of other EU15 countries, which show an increase of 7.2% in unit labour costs compared with 16.7% in Greece. According to SEV, this impacts negatively on the competitiveness of the national economy. SEV also argues that this significant increase is partly due to the steady rise in minimum salaries and wages in recent years – an increase that is in fact advancing at a higher rate than the population’s growth rate.

At the same time, SEV highlights the need to take measures to support Greek industry, by pointing out that some of its analyses show worrying trends: for example, 30% of enterprises are operating at a loss, while sales figures have decreased for 37% of companies. SEV thus proposes to take into account the economic conditions of the entire European Union when calculating inflation; it also recommends determining minimum wages in a different way in the country’s four prefectures which display the highest unemployment rates. Therefore, it appears that the conclusion of the EGSSE is not a guarantee for peaceful industrial relations in the short term.

Anda Stamati, Labour Institute of Greek General Confederation of Labour (INE-GSEE)

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