Collective Bargaining

The ECB signals in its economic bulletin that wages in the Euro-area are on the rise. Collective wages rose 2.2% in the 2nd quarter of 2018, the highest increase since 2012. The bulletin provides economic charts with data that point to a continued upward shift from a trough in the 2nd quarter of 2016. Growth in compensation per employee increased from 1.8% in the 4th quarter of 2017 to 2.0% in the 1st quarter of 2018, confirming the recent upward trend. Growth in negotiated wages increased from 1.5% in the 4th quarter of 2017 to 1.8% in the 1st quarter of 2018. Recent wage agreements and the broadening of wage growth across sectors support the expectation of a further pick-up in wage growth. The developed wage growth follows the direction of improving labour market conditions.

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Retailers and trade unions tentatively agreed that workers at large chains will get days off on Christmas and Easter. The Association of Lithuanian Trade Companies wants this agreement to cover all retailers, not only large chains. Furthermore, the companies stated that they in principle agree to the proposal to keep stores closed for two days a year, but they do not want that list to be expanded in the future. Trade unions, on the other side, want shop workers to be free on all official holidays and at least one Sunday a month.

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Government officials proposed a new manner to make minimum wage calculations. They want to set minimum wage at 50% of the average salary that was earned the previous year. The proposed valorisation mechanism would require amending the Labour Code. Trade unions are believed to back the proposals, which could come into effect in 2020. Meanwhile, the Ministry of Labour and Social Affairs put forward a decree raising the minimum wage by 12.3% as of January 2019. The increase is widely seen as long overdue; in terms of purchasing power, the country has the fourth-lowest minimum wage in the EU, after Bulgaria, Latvia and Lithuania.

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According to the trade union of public hospital workers (POEDIN), the number of permanent employees at hospitals has been decreased by 25.000 since 2010, when the country signed its first international bailout. Furthermore, there would not be enough doctors on the islands and a lot of the equipment in state hospitals is in serious need of replacement.

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Dockworkers started a four-week overtime strike due to end on 10 September, in a protest called by the Stevedore and Logistics Activity Union (SEAL). The strike covers all overtime work, in other words all the work that exceeds normal working hours or daily working hours on business days, and all work on Saturdays, Sundays and holidays. The reason for the strike is the increasing proliferation of anti-union practices in several ports, which is extremely severe in the port of Leixões and continues to be severe in the port of Caniçal. The trade union accuses port companies of ‘criminal behaviour’ including moral harassment from persecution to duress, from bribery to discrimination, dismissal threats and salary blackmail, to turning workers against each other and to prevent them from free and conscious unionisation.

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African migrant harvest workers went to strike to protest at poor working conditions. The strike follows an incident in which 12 non-EU migrant farmworkers died in road crashes. The USB trade union federation called for the strike. According to the local press most of the workers are subject to what is known as a ‘caporalato’ system of organised, undeclared work. They often earn little more than 1 euro per hour, while the standard wage is six times higher.

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The trade unions are urging consultations about planned staff cuts in public administration. It is unacceptable that the cabinet has announced plans to cut public administration staff by 15-20 percent without proper consultations with the unions concerned and any impact studies carried out.

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Railway maintenance workers are on strike. The protest against staff shortages and lack of reinforcements was called by the National Independent Union of Railways. Meanwhile, the main rail workers trade union federation Fectrans called a strike for 3 October in view of what it called a lack of investment and staff cuts in the sector. On 24 October, a ‘Road Forum’ event is to be held with the aim of bringing together rail workers, customers, technicians and specialists organisations to reflect on the current situation in the sector.

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Trade union Verkalýðsfélag Akraness, that represents manual and unskilled workers, has sued whaling company Hvalur for alleged systematic violations of labour laws. The union argues that the company illegally barred its employees from choosing which union to belong to (see our June newsletter). The union also accuses the whaling company of paying worker less than they were entitled to while also refusing to provide weekly day-off.

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Trade unions ALEBA, LCGB-SESF and OGBL-SBA and the bank Credem International have failed to reach an agreement on a social plan for the employees after the bank announced the closure of its Luxembourg branch. According to the unions, the bank's proposal was below what is applied in similar situations and did not even correspond to a quarter of what is customary in the country’s banking sector. It is now up to the state conciliation office (ONC), responsible for arbitration when no agreement is reached, to act.

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