Overall satisfaction with current bargaining system

In 2007, Slovakia introduced important changes in labour legislation. Most changes came about as a result of requests from trade unions to improve employee protection and collective bargaining. However, employers had serious reservations about the changes. In order to map experiences with the implementation of changes, the Institute for Labour and Family Research conducted a company survey in late 2008. Overall, respondents were mostly satisfied with the current collective bargaining system.

Background

In 2007, many amendments were made to the Slovakian Labour Code (SK0709029I) as well as to the Act on Collective Bargaining (SK0708019I). Most of those changes were initiated by the trade unions associated with the Confederation of Trade Unions (Konfederácia odborových zväzov Slovenskej republiky, KOZ SR). Trade unions wanted to increase protection of employees and improve conditions for trade union activities, including collective bargaining. Many of the proposed changes were criticised by employers, with representatives stating that the adoption of such changes would worsen labour market flexibility and hinder the creation of new jobs in the country. The legislative changes were adopted at a time when trade union density as well as the coverage of employees by collective agreements decreased. For instance, according to the Information System on Working Conditions (ISWC) issued by Trexima Ltd in Bratislava for several years (based on the survey company sample), the share of companies with trade unions decreased from 64.5% in 2002 to 43.4% in 2007. As Table 1 shows, the proportion of companies where collective agreements were concluded has also been decreasing. Meanwhile, the number of companies where works councils were elected – but which have no right to collective bargaining – increased from 8.6% to 16% over the same period.

Table 1: Share of companies with collective agreements, 2002–2007
  2002 2003 2004 2005 2006 2007
Share of companies with concluded collective agreement 53.8% 46.6% 50.3% 47.4% 42.2% 36.8%

Source: Institute for Labour and Family Research (IVPR), Bulletin Rodina a práca 4/2009

Survey in selected companies

After the implementation of adopted changes in the labour legislation, there was a justified need to find out to which extent the changes contributed to improvement of employee protection, as well as to improvement of trade union activities in Slovakia, including collective bargaining. In order to provide answers to these questions, the Institute for Labour and Family Research (Inštitút pre výskum práce a rodiny, IVPR) mapped the situation in selected companies in Slovakia by conducting a field survey. The survey was carried out among a sample of 77 different companies in late 2008. Table 2 shows the structure of the sample of companies selected for the survey (in Slovakian, 919Kb PDF).

Table 2: Company survey sample
Origin of company Number of selected companies Company size
Slovak 48 10 Small
Foreign 15 29 Medium
Multinational 14 38 Large
Total 77 77 Total

Source: IVPR, Bulletin Rodina a práca 4/2009

Representatives of management and employees in the selected companies were interviewed via questionnaires. Employees were represented in 47 companies by a single trade union organisation and in 11 companies by several trade union organisations. Trade unions as well as works councils represented employees in four enterprises. No trade union existed in 15 enterprises and the employees in these companies were represented only by works councils. In addition to gaining information on collective bargaining, the survey also aimed to analyse conditions of employee participation and individual labour relations. Survey results concerning existing conditions for collective bargaining in enterprises are presented below. However, survey results concerning conditions for employee participation and activities of their representatives are included in a separate article published by the European Working Conditions Observatory (EWCO) (SK0905019I).

Survey results

Current practice of collective bargaining

The survey reveals that, in most cases, collective bargaining is initiated by the trade unions, as confirmed by almost 89% of the interviewed trade union representatives. The most important issues of collective bargaining are wages, working conditions and occupational safety and heath (OSH). More than 17% of the interviewed trade unionists reported that collective bargaining with employers usually involves conflict. Wage bargaining was considered by nearly 73% of employers and 32% of trade unionists as one of the most problematic issues of collective bargaining. Employment conditions, working conditions and wages were in about 80% of the surveyed companies regulated by single-employer collective agreements and in only around 17% of the surveyed enterprises were those issues regulated by multi-employer collective agreements. Collective agreements are usually concluded for a period longer than a year – in almost 64% of enterprises, the agreements were concluded for two or three years. According to the survey, collective labour conflicts arising in connection with collective bargaining are usually resolved through negotiation between the social partners. In the case of more serious conflicts, both employers and trade unions consult their own legal representatives – this occurs in about 50% of cases. In about 30% of cases, employers and trade unions request assistance from the National Labour Inspectorate (Národný inšpektorát práce, NIP) in order to resolve disputes.

Satisfaction of social partners

The survey also investigated satisfaction of the social partners with the existing conditions for collective bargaining in enterprises. Answers to the basic question regarding the extent to which the existing legislation ensures the rights of employees to collective bargaining were unanimous among the employers and the employee representatives. Most of the social partners (74% of employers and 73% of employee representatives) expressed their satisfaction with the existing representation of employees by trade unions in collective bargaining procedures.

Most of the employers (90%) and employee representatives (73%) expressed their full satisfaction with the existing legal regulation of social partner activities during collective bargaining. Nonetheless, trade union representatives had reservations about the fact that, although the legislation imposes on employers the obligation to participate in collective bargaining, it neither specifies the deadline for the conclusion of collective agreements nor specifies the obligation of the employer to conclude a collective agreement at all.

Satisfaction among the social partners differed with regard to regulations specifying the eligibility of parties to participate in collective bargaining when the employees in an enterprise are represented by more than one trade union. The least satisfaction was expressed by employers and trade union representatives regarding the current practice concerning the resolution of conflicts when several trade unions exist in the enterprise, and concerning which trade union organisation in this case has the right to participate in collective bargaining and the conclusion of collective agreements. Table 3 shows the level of satisfaction among the survey respondents in relation to those issues.

Table 3: Satisfaction with current regulation
Issue Employers Employee representatives
Eligibility of trade unions to participate in negotiations in companies    
Fully satisfied 88.7% 75.7%
Partly satisfied 3.2% 14.3%
Not satisfied 0% 1.4%
Did not respond 8.1% 8.6%
Eligibility to participate in multi-employer bargaining    
Fully satisfied 51.6% 48.6%
Partly satisfied 8.1% 8.6%
Not satisfied 0% 4.3%
Did not respond 40.3% 38.5%
Disputes about eligibility to participate in negotiations    
Fully satisfied 40.3% 35.7%
Partly satisfied 0% 1.4%
Not satisfied 0% 0%
Did not respond 59.7% 62.9%

Source: IPVR, Bulletin Rodina a práca 4/2009

Main problems of collective bargaining

In addition to analysing the overall satisfaction of respondents with the existing conditions for collective bargaining, the survey also pointed out several problems associated with the bargaining system. Employers and trade unionists considered the existing way of extending multi-employer collective agreements as the most problematic issue. Only less than 23% of employers and 43% of trade unionists expressed their satisfaction with the existing rules for extending collective agreements. The employers had reservations about extending collective agreements without the consent of the employers concerned and the trade unionists considered the existing regulation for extensions ambiguous and sometimes even confusing.

The second most problematic area identified was the practice of collective bargaining in companies where the employees are represented by more than one trade union organisation. According to the employers, the employer should negotiate only with one joint representative of all trade unions existing in the company. These trade unions should jointly agree who will be their representative during collective bargaining. On the other hand, according to the representatives of the trade unions, all trade union organisations involved in collective bargaining should have equal rights to bargaining. At the same time, the trade unions would consider it more convenient that, in cases when individual trade unions cannot come to an agreement concerning a joint practice during collective bargaining, the strongest trade union organisation with the highest number of members should negotiate on behalf of employees.

Commentary

Although the results of the survey showed that the majority of employers and trade unions are satisfied with the conditions for collective bargaining, the current practice does not show a significant development in collective bargaining in terms of coverage of employees by collective agreements. For instance, according to the ISWC 2008, company collective agreements were concluded in 35.6% of the sample enterprises, which is one percentage point less than in 2007. The reason for this decline, however, is not the inconvenient legislation but the current unfavourable situation in enterprises caused by the global economic crisis. According to the trade union representatives, the economic crisis contributed to decreasing trade union membership as well as to lower coverage of employees by collective agreements. On the other hand, a significant development was made in solving probably the most topical collective bargaining problem – the regulation of extending multi-employer collective agreements (SK0906019I).

Ludovít Cziria, Institute for Labour and Family Research

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