Collective employment relations - Q2 2014 (EurWORK topical update)

This article presents some of the key developments and research findings on aspects of collective employment relations in the EU during the second quarter of 2014. Industrial relations reforms, actual and proposed changes to the labour codes in certain countries, and changes in the union rights of state security force employees are the main focus of this report.

Reform of industrial relations systems

Reforms to the industrial relations systems in these two countries are being dealt with in very different ways. While Ireland aims to modernise the system and provide more clarity, the Portuguese government is introducing limitations to the collective bargaining regime.

Ireland: Modernised industrial relations framework

Both sides of industry welcomed the announcement on 13 May by the Minister for Jobs, Enterprise and Innovation that the government would reform the Industrial Relations (Amendment) Act 2001 ‘to legislate for an improved and modernised industrial relations framework that will provide more clarity for employers and more effectiveness for workers’. Some of the main provisions include:

• defining what constitutes ‘collective bargaining’;
• steps to help the Labour Court identify whether internal bargaining bodies are genuinely independent of their employer;
• policies and principles for the Labour Court to follow when assessing workers’ terms and conditions, including the sustainability of the employer’s business in the long term;
• provisions to ensure that remuneration, terms and conditions are looked at in their totality;
• an explicit prohibition on the use by employers of inducements (financial or otherwise) designed specifically to get staff to forgo collective representation by a trade union.

On 23 April the government also published the Employment Permits (Amendment) Bill 2014. The law, when enacted, is intended to reform and modernise Ireland’s employment permits system. It seeks to provide for a robust employment permits regime, to give clarity and certainty to potential investors and employers. It will help them with their business planning and human resources decision-making, and address recent deficiencies that the High Court has identified in the legislation. The ruling in the 2012 Younis case showed that the current law has the potential to allow employers to benefit from illegal employment contracts in situations where an employee does not hold an employment permit but is required to do so.

Portugal: Limitations on collective bargaining and changes to working hours

The Portuguese government has presented legal proposals that introduce limitations to the collective bargaining regime. They extend the suspension of payment for overtime and holiday work, as set out in collective agreements and labour contracts, until the end of 2014. A substantial reduction in the period of validity of collective agreements is also proposed, as is the possibility of temporarily suspending collective agreements in companies in crisis, if the survival of the company and the jobs of its employees are at risk.

However, recent legislative changes introduced by the Portuguese government to increase public sector working hours have been offset by collective agreements signed by local authorities and trade unions.

As part of the austerity measures aimed at cutting costs in public administration, in September 2013 the government passed a law increasing the standard working week in the sector from 35 to 40 hours without extra pay. However, between the last quarter of 2013 and the end of April 2014, trade unions and local authorities signed around 350 collective agreements restoring the 35-hour week. The government delayed the publication of these agreements (they have not yet been published) by sending a request to the Attorney General for an opinion on whether municipalities have the power to conclude collective agreements with the unions without government intervention. Press reports suggest that the view of the Attorney General’s office is favourable to the social partners, and that it is likely to conclude that they do have the autonomy to conclude collective agreements.

Changes to the labour code

Germany and Italy: Right to retire

In Germany and Italy, certain groups of workers have been given the right to retire before the legal retirement age and even prohibited from working beyond it, despite the general European trend of promoting a longer working life.

The German Federal Labour Ministry introduced draft legislation on the Artist’s Social Security Fund (KSK) to increase KSK’s funding by helping employers pay social security contributions for its members. The KSK differs from other statutory health insurance schemes because it covers self-employed people who work in the creative or media sector as freelancers or contract workers. Some 180,000 individuals are members. As with similar insurance schemes in Germany, contributions to the fund are made by both the worker and the employer, but in the case of KSK the artists pay 50% of their social security contribution; of the remaining 50%, 30% is paid by the employers and 20% by the federal state. On 24 May, the German parliament approved the new pensions package for artists. It was hotly debated because it allows a selected group of workers to retire at 63, lower than the average retirement age.

On 24 June 2014 the Italian government enacted Decree-Law no. 90, which removes the right of state employees to work beyond retirement age. The type of self-employment relationship that is currently available to workers reaching retirement age (so-called ‘lavoro a progetto’ or ‘co.co.co’ fixed-term contracts) will not be allowed beyond 31 October 2014. The government estimates that this reform will create jobs for 15,000 new employees. Thresholds for new hiring are fixed. The 20% threshold for 2014 will rise to 40% in 2015, 60% in 2016 and 80% in 2017. Mobility for state employees within and between departments has also been simplified. Furthermore, from 1 September 2014, time off provided for union activities will be halved.

Germany: Minimum wage debate

The German parliamentary debate continues on the Act for the Promotion of Autonomous Collective Bargaining (Tarifautonomiestärkungsgesetz), which will set up a statutory minimum wage. There is controversy about whether or not the Act should exclude particular groups of workers from the minimum wage (see EurWORK quarterly update on pay, Q1 2014).

Austria, Norway and Estonia: Working time reform

In Austria, social partners and the government are negotiating a reform of the regulation on working time, looking extending the maximum working day to 12 hours under certain circumstances and – in exchange – at facilitating the possibility to reach a sixth week of annual leave for employees. In Norway, the government has presented a controversial consultation paper for new legislation on fixed-term employment and working time regulations that is expected to meet opposition from unions. And in Estonia, the Estonian Trade Union Confederation says that social partners are on the verge of resolving their differences over the Draft Act on collective agreements and the Collective Labour Dispute Resolution Act.

Denmark: New active labour market policies

On 18 June, final agreement was reached on a new employment reform between the Danish government and three political parties: Venstre, Det Konservative Folkeparti and Dansk Folkeparti. The employment reform promotes activation courses to improve people’s employability. It also creates new education possibilities and encourages greater cooperation between unemployment funds and public employment centres.

Right to strike and right of association in the public sector

Ireland: Police win right to strike

In May, following a Council of Europe decision, the representative bodies for the Irish police force (the Garda, the Association of Garda Sergeants and Inspectors (AGSI) and the Garda Representative Association (GRA)) won the right to strike, negotiate on pay and conditions and affiliate to the Irish Congress of Trade Unions. Previously these bodies had been restricted from engaging in such activities.

According to a report in the Irish Examiner, Anna Nellberg Dennis, President of the European Confederation of Police (EuroCOP), said the decision was ‘a victory not only for the Garda, but would have important implications for forces across Europe. By highlighting the fundamental importance of police rights, and educating European police officers about their rights to organise and to bargain collectively, the Committee has helped us draw more attention to those Member States that are failing to adequately provide for the social rights of their police officers.’

Malta: Security forces win trade union rights

A similar development has taken place in Malta. On 14 May 2014 the Minister for Home Affairs and National Security, Manuel Mallia, announced that, after a number of Cabinet meetings, a bill of law has been approved to grant trade union rights to members of the security forces (including police officers, members of the armed forces, prison wardens and members of civil protection bodies). The Employment and Industrial Relations Act (EIRA), which regulates industrial and employment relations, does not currently allow these members to enrol as trade union members. The proposed bill does not, however, give these workers the right to strike. The extension of the right of association to the security forces in Malta was welcomed by the trade unions, and the General Workers Union (GWU) immediately formed a police union as an affiliate.

Lithuania: Reform of law on strikes

In Lithuania, amendments to the labour law liberalising the organisation of strikes and promoting social dialogue in the public sector came into effect on 1 July 2014.

About this article

This article is based mainly on contributions from Eurofound’s network of national correspondents. Further resources on collective employment relations can be obtained from EurWORKs Industrial relations country profiles and the European Company Survey (ECS).

For further information, contact Christian Welz: cwe@eurofound.europa.eu or Christine Aumayr-Pintar: cau@eurofound.europa.eu.