Romania: New law enhances role of trade unions in collective bargaining process

Following long efforts on the part of trade unions, the Social Dialogue Act was amended to allow the representative federations at sectoral level to conclude collective agreements in  establishments where the trade union organisation is not representative at company level.

A recent amendment of the Social Dialogue Law, voted by Parliament in December 2015, provides for a significant change in the collective agreement concluding process. The new law stipulates that in companies without a legally representative trade union the employees can be represented in the collective bargaining by the representative trade union federation to which the company trade union is affiliated and, thus, the federation is entitled to sign the contract. Prior to these amendments, Law 62/2011 provided that in establishments where there is no representative trade union, the collective agreement is concluded, on behalf of the employees, by the employee representative. This provision resulted in the unrepresentative trade union organisations being marginalised in the collective bargaining, which have been quasi replaced by the employee representatives, an institution that is only vaguely regulated by law and does not guarantee a proper representation of employees’ interests. A recent study carried out by the Conect Association indicates that since 2011, when the employee representatives were empowered to negotiate collective agreements in those companies that do not have a representative union organisation at company level, 86% of the total collective agreements concluded in 2014 at company level were signed byemployee representatives and only 14% by representative trade unions. The situation is more dramatic in the private sector, where only 8% of collective agreements at company level have been concluded by representative trade unions. It is expected that the amendment that was voted by Parliament in December 2015 will trigger a revival of the unions’ role in the collective bargaining process.

ILO data show that between 2008 and 2013 Romania had the sharpest decline in collective bargaining coverage (minus 60%). On average, there was a drop in bargaining coverage of 4.6 % in a reference group of 50 countries.

National data from the Labour Inspection indicate that the coverage varies enormously from one county to another: 43% of employees are covered by a collective agreement in Harghita county while only 0.3% are covered in Cluj and Dambovita counties. 

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