Collective agreement sets tone for 2012 wage bargaining

A collective agreement between the Swedish Forest Industries Federation and the Swedish Paper Workers’ Union was reached on 17 December 2011, featuring a 3% wage increase over 14 months. The agreement, the first to be reached with the coordination of the Swedish Trade Union Confederation, conforms to wage levels set in previous agreements within the Swedish industry agreement. This reinforces its norm-setting role in the 2011–2012 wage bargaining round.

New agreement in pulp and paper industry

On 17 December 2011, the Swedish Forest Industries Federation (Skogsindustrierna) and the Swedish Paper Workers’ Union (Pappers) reached a new collective agreement for 15,000 blue-collar workers within the pulp and paper industry in Sweden valid from 1 February 2012 to 31 March 2013.

A 3% wage increase over 14 months, the equivalent of an annual rise of 2.6%, was agreed. The social partners also agreed to set up several new working groups to examine issues such as the working environment during shift work, a reworking of general terms and conditions of employment, an introduction of a flexible pensionable age and a new overall wage model.

Despite referring to present economic uncertainties, Jan-Henrik Sandberg, Chair of Pappers, assured its members of real wage increases without endangering the overall competitiveness of the export industry. Nonetheless, Skogsindustrierna’s chief negotiator and Deputy Managing Director Per Hidesten said the agreement pushed the sector’s companies close to breaking point, suggesting a threat of downsizing.

A significant factor behind the agreement was probably an 11-day strike by 3,000 union members after the previous bargaining round in April 2010. Both social partners wanted to avoid another conflict because of the high costs of strikes. The 2010 agreement had eventually settled on a 3.3% wage increase over 22 months, significantly lower than agreed in the 2012 bargaining round.

Pay coordination

The new collective agreement is the first to be reached with the coordination of the Swedish Trade Union Confederation (LO). It is therefore an important precursor for the whole bargaining round of blue-collar workers. The level of pay increase reached was the same as that in the previously negotiated industry agreement, which reinforces its norm-setting role in Swedish wage bargaining (SE1105019I).

‘The standardisation of wage setting is strengthened for the entire Swedish wage bargaining round,’ claimed Skogsindustrierna’s Per Hidesten. Wanja Lundby-Wedin, Chair of LO, said the agreement supported the continuation of the 2012 bargaining round.

A similar agreement was reached earlier in the week between Skogsindustrierna and the Swedish Union for Workers in the Forestry, Woodworking and Graphic Industries (GS), the Swedish Association of Graduate Engineers (Sveriges Ingenjörer), and the Swedish trade union for professionals in the private sector (Unionen).

Commentary

Both the industry agreement and the LO wage bargaining framework have been challenged and tested in the early phases of the 2011–2012 bargaining round (SE1109019I). With the agreement between Pappers and Skogsindustrierna in place, the unity among trade unions and the norm-setting role of the industry agreement, has, at least in part, been restored.

Mats Kullander and Martin Bodensten, Oxford Research

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