Latest union merger part of ongoing process

In December 2006, three small trade unions, representing employees in the railway sector and blue-collar workers in the commerce, transport, hotels and catering, and personal services sectors, merged their organisations, thus establishing the trade unioncalled vida. This merger marked the end of a series of union restructuring processes in 2006. However, the outcomes of such union merger activities remain unclear.

On 6 and 7 December 2006, the newly-established vida trade unions held its founding congress in Vienna in the presence of some 774 delegates of the three predecessor unions. At this event, the union was officially set up as a result of the merger of the former Union of Railway Employees (Gewerkschaft der Eisenbahner, GdE), the blue-collar Commerce and Transport Union (Gewerkschaft Handel, Transport, Verkehr, HTV) and the blue-collar Hotels, Catering and Personal Services Union (Gewerkschaft Hotel, Gastgewerbe, Persönlicher Dienst, HGPD).

In December 2006, the vida trade union, which organises and represents employees in such diverse occupations as truck and engine drivers, waiters and nurses, had about 166,000 members. In terms of membership numbers, it is thus the country’s fourth largest affiliation to the Austrian Trade Union Federation (Österreichischer Gewerkschaftsbund, ÖGB). The vida founding congress temporarily marked the end of a series of merger activities, which affected the Austrian trade union movement during 2006 and which became necessary due to continued membership loss and financial instability.

The former Chair of HGPD, Rudolf Kaske, was elected first chair of vida, while the former respective Chairs of GdE and HTV, Wilhelm Haberzettl and Willibald Steinkellner, were elected vice chairs of the newly established union.

Vida organisational structure

Within the vida union structure, the various occupational groups which were previously organised in separate trade unions have been centralised into three larger sections and nine federal occupational units (Bundes-Fachgruppen). The transport section covers all transport systems, including railways, road and water transport, and air traffic. The social, personal and health services section represents employees in the areas of nursing, social services and healthcare. The private services section organises employees in occupations related to tourism, commerce, cleaning and maintenance, as well as private security services.

Reasons for merger

A multitude of reasons may have underpinned the merger activity in question, many of which, however, are masked by the rhetoric of union officials which tends to downplay the impact of external factors and to emphasise the positive aspects of restructuring. These are claimed to arise from economies of scale following the merger process, whereby reference is made to improvements in membership services and support. As was the case with other merger projects, the official aim behind the merger between the three unions was to strengthen their position particularly with regard to employers and public authorities, and also to centralise and coordinate the unions’ bargaining policies across different branches and sectors. However, the unions saw the need to merge in the light of a combination of membership decline and financial weakness, in particular in the wake of the revelation of ÖGB’s involvement in the financial debacle concerning its former own BAWAG PSK bank (AT0605029I).

Past union merger activities

In the mid 1990s, the ÖGB developed a proposal to replace the union structure at the time based on 14 trade unions with a union structure comprising only three unions, covering manufacturing, private services and the public sector. The idea was to streamline the union administration and thus to benefit from synergy effects. The aim was also to centralise and coordinate political strategies and bargaining policies across the whole economy – an aim devised to strengthen the national trade union movement as a whole. However, real opportunities for confederal leadership in union restructuring were curtailed due to the affiliates’ reluctance to give up their autonomy.

Therefore, in February 2001, the then ÖGB President, Fritz Verzetnitsch, presented a new proposal for organisational reform. This proposal would have signified a substantial change in the membership domains of ÖGB’s affiliated unions and a reduction in their number from the then 13 trade unions to eight unions (each with wider-ranging domains). Above all, these plans would have meant the break-up of Austria’s largest affiliation, the Union of Salaried Employees (Gewerkschaft der Privatangestellten, GPA), which covers the white-collar workers of all branches of the private sector. At that time, ÖGB aimed to organise both blue-collar workers and white-collar workers in adjoining branches within one and the same ‘industry union’. This, in turn, would have meant the GPA losing its coherence completely, with its members being distributed across almost all of the new unions (AT0104212N).

Merger plans fail

However, the confederation also failed to realise its second, more moderate reform initiative. This is mainly because the two most powerful member unions, the GPA and the then Metalworking and Textiles Union (Gewerkschaft Metall-Textil, GMT), which had cooperated intensively in collective bargaining and used to set the pace for bargaining for other unions, opposed the ÖGB reform proposal (AT0110205N). In October 2001, in a surprise move, GPA and GMT announced the merger of their organisations. In doing so, they bypassed both ÖGB and its other member unions. Subsequently, three other unions joined the merger process aimed at creating a new ‘centre of gravity’ within the trade union movement. However, following several years of negotiations, it turned out that differing ‘corporate cultures’ among the trade unions, in particular between GPA and GMT, and inter-union conflicts over the distribution of power and posts proved insuperable impediments to establishing such a large-scale trade union merger (AT0410201N). The union merger plans involving GPA, GMT and three smaller unions were thus officially dropped in September 2004.

Successful mergers

As a consequence of this failure, GPA and GMT successfully attempted to achieve separate, less ambitious merger solutions: GMT acquired the Agricultural, Food, Beverage and Tobacco Workers’ Union (Gewerkschaft Agrar, Nahrung, Genuss, ANG) in the spring of 2006 while GPA absorbed the smaller Printing, Journalism and Paper Union (Gewerkschaft Druck, Journalismus, Papier, DJP) in the autumn of the same year. The most recent merger project involved GdE, HTV and HGPD, which saw the establishment of vida in late 2006 (as outlined above). According to union officials, the vida merger project was accelerated as a result of the revelations of the BAWAG bank scandal, which unveiled the drastic financial situation of ÖGB and all member unions. In the wake of that debacle, ÖGB was forced to sell all of its shares in BAWAG by 2007. This move means that the only source of revenue in the future for ÖGB is to be membership dues paid by a sharply declining number of members Therefore, the unions are currently compelled to effectively streamline and economise on their organisations.

Commentary

Relevant research has revealed that union confederations throughout Europe have had little influence over the specific mergers undertaken by affiliated trade unions during the last decades, even when it comes to union merger processes. This holds true also of the Austrian confederation. Despite ÖGB’s efforts since 1995 to draw up and establish a possible future organisational union structure which would be capable of compensating for membership decline and consolidating union balances, the affiliated unions have sought merger solutions that would meet their own specific interests. For smaller unions representing declining industries and occupations, mergers appear to be inevitable in order to secure union representation. It is thus most likely that the union merger process will go on, in particular against the background of the ÖGB general assembly on 22–24 January 2007 having adopted a concept of unionism which strengthens the organisational, political and financial autonomy of member unions at the expense of the confederation’s power (AT0611029I).

However, the outcomes of such merger activities remain unclear. Firstly, mergers are supposed to mitigate the effects of membership losses rather than really strengthen the organisations in terms of finances and collective bargaining power. Secondly, the establishment of such a new concept of unionism in Austria is likely to weaken the confederation, whose role as political actor vis-à-vis the employer organisations and the government (in the framework of the country’s highly developed macro-level social partnership) is thus questioned. Thirdly, union mergers may reduce or even eliminate competition between unions for members, but render membership of individual trade unions more heterogeneous. Increasing heterogeneity among members in combination with declining overall membership may result in more complex forms of internal union representation, which may, in turn, have negative effects on post-merger membership participation.

Taking all these uncertainties into consideration, it is hard to assess the outcomes of the recent and future union merger activities.

Georg Adam, Institute of Industrial Sociology, University of Vienna

Useful? Interesting? Tell us what you think. Hide comments

Eurofound welcomes feedback and updates on this regulation

Add new comment