Strike over subcontracting in construction sector

Following an agreement reached between unions and construction sector companies on 14 April 2011, an open-ended strike at Lemessos Marina was resolved after four days. The strike had been prompted by the employers’ decision to assign part of the construction work at the marina to sub-contractors. The unions said this was a violation of the sectoral collective agreement, while employers said the strike itself violated both the agreement and the Industrial Relations Code.

Background

On 7 April 2011, the Democratic Labour Federation of Cyprus (DEOK), the Pan Cyprian Federation of Labour (PEO) and the Cyprus Workers' Confederation (SEK) announced a strike against the consortium of J&P and Cybarco, which is responsible for construction at Lemessos Marina.

The workers’ decision to strike was prompted by the consortium’s decision to assign part of the construction work in the Marina to sub-contractors.

The workers’ argument

In the workers’ opinion, by assigning part of the work to sub-contractors and entering into individual contracts with them, the employers violated the provisions of a sectoral collective labour agreement.

The three unions note that, out of a total of around 200 workers employed on the project, only 50 workers are employed outside the sub-contracting system.

In the opinion of the trade unions, the use of workers from other EU countries as a cheap source of labour, from most sub-contractors in the construction industry, is a contributing factor for the increasing unemployment among Cypriot workers in the sector. A large proportion of the contractors systematically violate labour legislation and collective labour agreements, they say, resulting in the creation of sub-standard terms and conditions of employment for a large proportion of workers throughout the whole spectrum of jobs in the construction industry.

The employer reaction

From their side, the companies claimed issued an announcement on 11 April 2011 stating that the consortium had observed the sectoral collective labour agreement to the letter, including the memorandum of agreement on contracting signed in July 2008 (CY0807039I). In a similar vein was a statement issued by the Federation of Building Contractors Associations of Cyprus (OSEOK), stating that any measures taken against the J&P and Cybarco consortium would violate both the Industrial Relations Code and also Article 27 of the sectoral collective labour agreement.

In an announcement made on 7 April 2011, the Employers and Industrialists Federation (OEB) condemned the strike, pointing to the extremely difficult economic circumstances in Cyprus and calling on the unions to enter into dialogue using the mediation service of the Ministry of Labour. It asked the unions to negotiate both the renewal of the collective sectoral agreement that expired on 31 December 2010, and the completion of the memorandum on contracting (CY0807039I).

Mediation agreement

On 14 April 2011 the open-ended strike at Lemessos Marina, which started on 11 April, came to an end, following acceptance by the two sides of a mediation proposal prepared by the mediation service of the Ministry of Labour and Social Insurance.

Specifically, the agreement stipulates that until 30 May 2011 there will be no labour disputes in relation to sub-contracting in construction work, as long as the following conditions are met:

  • The sectoral collective labour agreement must be observed for all contractors and sub-contractors;
  • All dismissals of employees at J&P and Cybarco will be suspended;
  • The collective labour agreement will be implemented immediately by the two contractors doing the construction work.

Eva Soumeli, INEK/PEO

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