New national agreement talks collapse

Talks have broken down over a new centralised national framework agreement, which would cover 94% of employees in Finland. After three weeks of exploratory negotiations, the social partners found that the positions and preconditions of the trade union confederations and the Confederation of Finnish Industries remained so polarised that there was no basis for discussions. Following this, a high level of industrial action in the autumn is predicted.

Background

The national framework agreement covering around 94% of Finland’s employees will terminate at the end of October 2013. Exploratory negotiations for a new centralised agreement were kick-started by the Confederation of Finnish Industries (EK) but the positions and preconditions of it and the trade union confederations remained so polarised, especially in relation to pay increases, that the discussions collapsed after three weeks.

Prime Minister appeals for centralised agreement

The leaders of the social partners met to negotiate at the official residence of Prime Minister Jyrki Katainen and, at the same time, leaders of the government parties were present for separate, but related, negotiations on the government budget. Despite the strong appeals of Prime Minister Katainen and other political leaders, the parties in negotiation found that it was impossible to reach enough common ground to continue. Prime Minister Katainen stated that, without a two-year deal on pay and conditions, the government’s ability to plan ahead is thwarted.

Polarised views

The President of the Central Organisation of Finnish Trade Unions (SAK), Lauri Lyly, stated that the ‘current purchasing power was to be supported with employees’ and employers’ pension contributions, and that endangers young peoples’ pensions’. Furthermore, the trade union confederations did not accept the employers’ negotiation offer of a pay freeze.

The Director General of EK, Jyri Häkämies, stated that ‘labour costs cannot rise’. He added that EK had continued to propose several different options to defuse the deadlock, but that these were not accepted by the trade unions.

Each side has blamed the other for the collapse in negotiations. The Prime Minister and many government ministers have expressed their deep disappointment and the Minister of Labour and past president of SAK, Lauri Ihalainen, stated that a centralised agreement would give the government more flexibility and room for policy-making and economic forecasting.

Difficult autumn ahead

The President of the Finnish Confederation of Professionals (STTK), Mikko Mäenpää, and the President of the Confederation of Unions for Professional and Managerial Staff in Finland (AKAVA), Sture Fjäder, expect negotiations for the next collective agreements will probably go ahead at sectoral or branch level next autumn, and that the bargaining round will be very difficult. Indeed, Mr Fjäder predicted ‘an autumn of industrial actions’. On the other hand, EK hopes that the next bargaining round will not end in a sectoral race for increasingly higher pay rises.

Pertti Jokivuori, University of Jyväskylä

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