Trade unions protest against abuse by companies of recession

In May 2009, the Czech-Moravian Confederation of Trade Unions held a demonstration highlighting the impact of the economic crisis and protesting against companies allegedly using the crisis as a pretext to reduce wages and employee benefits. The demonstration was part of the European action days organised by the European Trade Union Confederation and supported by trade unions from other European countries, such as Bulgaria, Germany, Poland and Slovakia.

On 16 May 2009, the Czech-Moravian Confederation of Trade Unions (Českomoravská konfederace odborových svazů, ČMKOS) held a demonstration in the country’s capital city Prague highlighting the effects and abuses of the economic recession. The demonstration was part of the European days of action – called Fight the crisis: put the people first – organised by the European Trade Union Confederation (ETUC) (EU0906029I). The first European days of action were launched with a demonstration on 14 May in Spain’s capital Madrid, with the support of some 150,000 participants. This was followed by a demonstration on 15 May in Brussels, involving about 50,000 participants, and by further mobilisations on 16 May in the German capital Berlin (100,000 participants) and in Prague. The latter demonstration was attended by about 30,000 supporters according to the trade unions, although the police estimated that attendance was lower at around 23,000 persons. Demonstrations were also held in other European countries, including Bulgaria, Poland, Slovakia and the UK. The decision to protest was adopted at an extraordinary congress of ČMKOS.

Trade union opposition

At the demonstration, trade union members protested against alleged attempts to abuse the consequences of the crisis to the detriment of employees. According to the trade unions, the government led by the former prime minister, Mirek Topolánek, had planned to follow such an approach. They are particularly critical of the proposals for the upcoming amendment of the Labour Code, prepared by the Ministry of Labour and Social Affairs of the Czech Republic (Ministerstvo práce a sociálních věcí ČR, MPSV ČR). The trade unions argue that such changes will curtail employees’ rights, including with respect to collective bargaining, and are critical of the proposed reform of the pension scheme – that is, under the ‘opt-out’ system, where a proportion of the funds from social insurance would go to private capital funds.

According to a spokesperson for ČMKOS, Jana Kašparová: ‘It is an open attack against employees’ rights.’ The Vice-chairperson of ČMKOS, Jaroslav Zavadil, added: ‘We want to send a clear signal that we do not wish any government, which will come… to bring in similar proposals.’ However, according to the trade unions, the demonstration did not target the current interim government led by Prime Minister Jan Fischer. At a meeting with the Chair of ČMKOS, Milan Štěch, Prime Minister Fischer assured that: ‘The government is going to listen carefully both to employers and trade unions. It may not happen that we will be deaf one to another.’

Alleged abuses of recession

In the trade unions’ view, some companies are abusing the crisis, using it as a pretext to reduce wages, salaries and employee benefits. However, if employees disagree with these measures, they risk being dismissed. On the trade unions’ websites, specific examples of such companies are listed, often involving chain stores and establishments operating in heavy industry. In his speech at the demonstration, Mr Štěch of ČMKOS highlighted: ‘Some companies pass the impacts of the crisis solely to employees. This is unacceptable for us and we must refuse it.’ Moreover, some companies are also reportedly employing workers on an illegal basis, thus enabling them to receive unemployment benefit at the same time. This affects the state budget, as expenditure on unemployment benefit will rise and, at the same time, the employer is not forced to pay health and social insurance contributions on behalf of such employees; moreover, the employee can evade the payment of taxes, which further reduces the state revenue.

Towards the end of the demonstration, the Chair of the Czech Metalworkers’ Federation KOVO (Odborový svaz KOVO, OS KOVO), Josef Středula, read an appeal addressed to the country’s President, members of the Chamber of Deputies and the Senate; this appeal also summarises the reasons why the European trade union movement, including the Czech trade unions, saw the need to organise the demonstration. The appeal read as follows:

Don’t allow those who did not cause the crisis to be harmed most harshly. Don’t make the crisis a pretext for changes in the Labour Code, which would bring about unprecedented curtailment of employees rights, including groundless dismissals from work. Don’t allow any hazard with the pension scheme, don’t approve the new, risky bill on pension savings, don’t allow a devaluation of saved pensions and further weakening of public finance. Act, make decisions and rule for the benefit of citizens, not in the interest of speculative profit of financial groups and lobbies and tax havens.

Outcome of G20 Summit

According to Mr Štěch of ČMKOS, support for the Prague demonstration was also reflected in some of the conclusions of the London summit of the 20 top world economies, which was held on 2–3 April 2009. The G20 Summit agreed, among other things, to invest about USD 1 trillion to fight the economic and financial crisis. Representatives of the countries in question also agreed on a reform of the global financial system, along with stricter monitoring of financial markets and the regulation of ‘hedge’ funds. The implementation of some of the agreed measures is, according to Mr Štěch, in the interest of trade unions.

Jaroslav Hála, Research Institute for Labour and Social Affairs (RILSA)

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