Banking Sector Strife over Industry-wide Agreement

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In recent letters to the Greek Federation of Bank Employee Unions (OTOE), the heads of six major banks announced their intention not to sign the new industry-wide collective labour agreement but to go ahead and sign enterprise-level agreements. This decision sparked strong opposition from OTOE.

In recent letters addressed to the Greek Federation of Bank Employee Unions (OTOE), the heads of Greece’s six biggest banks stated that they would not sign the new industry-level agreement but would enter into enterprise-level collective agreements with the unions in each bank. It is worth mentioning that three of the banks are in private hands (Alpha Bank, Euro bank and Piraeus Bank), two have been privatised (National Bank of Greece and Emporiki Bank) and one (ATEbank) is mainly publicly owned.

According to the releases, the six identical letters state that the Hellenic Banking Association is not involved in the matter. At the same time they describe the process of signing industry-wide agreements as outmoded, because most banks are not publicly controlled, because a large proportion of foreign institutional investors have holdings in them, and also because there are such important differences between banks (on the level of business plans, countries in which they are located, economic potential, etc.). As a result, the appointment of a joint representative is no longer of any advantage. Also indicative of this question are the statements the presidents and managing directors of each bank made to the press. Specifically, the President of National Bank made the following statement: 'Enterprise-level agreements may offer better solutions through direct bargaining between the employer and employees and through direct familiarity with the particular conditions and problems of each bank'. Euro bank Managing Director referred to the unrealistic nature of some of OTOE’s demands: 'On a purely indicative basis, I would note the excessive pay increase of over 10%, which will place an inordinate burden on operating costs and reduce weekly working hours from the current 37 to 35'. On his part, Alpha Bank Managing Director pointed out the following: 'In keeping with the new situation, labour and social issues in the banking sector, including pay issues, can no longer be the subject of industry-wide collective labour agreements. These issues must be dealt with through enterprise-level agreements with the representatives of each bank’s employees separately'

This decision sparked strong opposition from OTOE, which talked about dangerous, arbitrary, arrogant and illegal conduct on the part of the banks, and about practices that are aimed at keeping wages and terms and conditions of employment at low levels. OTOE reacted initially by calling a 24-hour strike for Monday 6 February. In a press release on 31 January 2006, GSEE expressed its full support for the initiatives of OTOE, and noted: 'The banks and the Hellenic Bank Association are called on to abandon immediately every thought or decision to refuse to bargain or enter into industry-wide collective agreements with the Greek Bank Employees’ Federation'

The government has avoided taking a position, arguing that it cannot interfere in collective bargaining and that the banks operate on private economy criteria.

The letters sent by the heads of the six biggest Greek banks come at a critical point in time for industrial relations in the banking and other sectors:

On the one hand, the system of collective bargaining at the central level has come under strong fire (the Federation of Greek Industries (SEV) - has talked about making high-unemployment areas of the country exempt from the minimum pay standards set in the National General Collective Labour Agreement)

On the other hand, as concerns the banks, recently one of the unions at Euro bank signed an agreement with management on opening hours that are different from those set in the industry-wide agreement, in two branches of the bank operating in shopping centres. This move was seen as throwing the industry-wide agreement as well as the role of OTOE into question.

This information is made available through the European Industrial Relations Observatory (EIRO), as a service to users of the EIROnline database. EIRO is a project of the European Foundation for the Improvement of Living and Working Conditions. However, this information has been neither edited nor approved by the Foundation, which means that it is not responsible for its content and accuracy. This is the responsibility of the EIRO national centre that originated/provided the information. For details see the "About this record" information in this record.

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