Collective Bargaining

The author of a Bruegel Policy Contribution (Issue 2016/11) comes to the conclusion that a reform of collective wage bargaining, which ultimately involves an agreement between social partners, can only be effective if widely discussed with representatives of trade unions and industry associations ex ante. When in the past governments tried to implement such reforms by decree (e.g. in 2011, at the peak of the sovereign debt crisis), there was industrial conflict and a suboptimal take-up of the reform's innovations. In this context, the government's willingness to discuss the introduction of a statutory minimum wage and to complement wages implicitly set by industry-wide contracts could surely improve the political feasibility and palatability of a decentralisation of wage bargaining. In a SIM Europe Policy Brief, published by the Bertelsmann Foundation, a set of policy measures is recommended, which should include a new wage bargaining system aimed at fostering productivity growth.
English: http://bruegel.org/wp-content .
The Policy Brief: http://www.bertelsmann-stiftung.de/fileadmin .

Trade union Industri Energi and the Norwegian Oil and Gas Association agreed on the offshore settlement. The agreement involves promotions and addition of about NOK 15 000 in total. The operator-, drilling- and catering agreements cover approximately 4000 offshore employees. The union had challenged an earlier mediation result (see our June Newsletter) because the mediator had put forward a proposed solution below the framework of the front trade's, a proposal which two other organisations, Leaders and Safe had accepted.
English: https://www.industrienergi.no/nyheter/consensus-mediation-on-the-offshore .

NUJ and other trade unions have welcomed the progress of the Competition (Amendment) Bill 2016, which seeks to return collective bargaining rights to freelance workers. With the all-party acceptance at committee stage, the Bill returns to the Seanad after the summer recess and would have to be approved by Dáil Éireann. The Bill aims at exempting some freelance or so called atypical workers from competition law.
English: https://www.nuj.org.uk/news/nuj-welcomes-seanad-move-on-freelance-rights/
The draft Bill: https://www.oireachtas.ie/documents/bills .

Research institute SOMO was commissioned by the European Trade Union Confederation to produce a report on letterbox practices and cross-border recruitment. The impact of letterbox-type practices on labour rights and public revenue features case studies from Germany, the Netherlands, Italy and Sweden, covering the meat sector, road transport, car manufacturing and construction. It shows how tax avoidance often combines with exploiting workers. Existing economic freedoms, notably the right to establish corporations in any EU jurisdictions with little substance requirements and the principle of freedom to provide services, give employers ample opportunities to avoid social security, tax and employment laws in countries of operation. Working conditions and wages come thus under strong pressure.
English: https://www.etuc.org/press/letterbox-type-practices-avoiding-taxes-and-exploiting .
The report: https://www.etuc.org/sites/www.etuc.org/files/press-release .

According to a detailed observatory of the Council for Youth (CJE), the income situation of youngsters is very problematic. The CJE reveals that even when youngsters succeed in leaving the family home, the vast majority (84%) share a flat with two or more people. Women are more likely than men to leave their parents' home. The worsening situation is down to the fragile state of the labour market and tough housing market conditions. The youth unemployment rate has hovered at around 50% since the beginning of the economic crisis and currently stands at 46.2%. The majority of young people take jobs that the CJE classes as precarious, part-time and seasonal; with 92.9% of all contracts signed by under-29s being temporary, while only 7.1% of contracts are permanent. In 2014, 36.4% of young Spaniards were living in poverty.
English: http://www.thelocal.es/20160704/80-percent-of-20-something-spaniards-still-live .
The report (in Spanish): http://www.cje.org/es/publicaciones/novedades/observatorio .

Alitalia had to cancel 142 flights due to a strike by part of its staff protesting the ending of certain employee benefits. The Alitalia representative said the action was linked to the recent ending of a `privilege for pilots and staff members', which allowed them to travel free from different parts of Italy to get to or from their bases in Rome or Milan. The decision to end that arrangement was taken to save money, and in line with other airlines in Europe and the rest of the world. The Fit-Cisl labour union condemned what it said was an `attack on the rights of workers', stressing that Alitalia staff had `always shown a great responsibility and professionalism', including in tough times.
English: https://www.yahoo.com/news/alitalia-strike-action-cancels-142-flights .

The government is under growing pressure to undertake job cuts of around 4500 people and pricing reforms in the country's Electric Power Industry, EPS. Both IMF and World Bank declared the EPS a problematic topic, warning that restructuring and financially stabilising the state power utility needs to be speeded up if the enterprise is to have a future. Data revealed by the Electro distribution show that EPS is the biggest employer in the country with more than 30.000 workers. The Fiscal Council estimated a layoff between 5000 and 10000 workers if restructuration should be done properly and a World Bank representative said that salaries in EPS need to be cut by 15 per cent over the next five years, which is around 4500 people.
English: http://www.balkaninsight.com/en/article/serbian-energy-power-industry-sackings .

The ILO produced a report on the EU in the series Studies on growth with equity. The crisis has raised the degree of socio-economic heterogeneity among Member States aggravated by imbalances in structural factors that could intensify in the future. The establishment of a European Pillar of Social Rights could foster upward convergence of socioeconomic outcomes by strengthening existing rights and improving social standards in the EU. Section C proposes policy avenues to encourage upward social convergence at the EU level, focusing particularly on (i) minimum wages and collective bargaining; (ii) minimum income guarantees; (iii) reconciliation of work and family life; (iv) employment promotion and unemployment protection; and (v) human capital and skills development.
English: http://www.ilo.org/wcmsp5/groups/public .

The supervisory board of the National Social Security Institute (NOI) has decided to increase pensions by 2.6%. The minimum monthly pension becomes BGN 161.38, while the maximum retains its level of BGN 910. The increase of pensions is calculated as the sum of 50% of the growth of inflation and 50% of the average insurable income for the past calendar.
English: http://www.novinite.com/articles/175258/Pensions+in+Bulgaria+Increase .

The central bank published an economic review with analyses of the development of the real economy, prices, public finance and credit, as well as the projected development of the domestic economy. Annex 2 presents a comparison between the ratio of Baltic countries' labour productivity to compensation of employees, measured in purchasing power parity (PPP) terms, and the same ratio in other EU countries. It shows that compensation of employees, as a share of total disposable income, is lower in Lithuania than in other Baltic countries.
English: https://www.lb.lt/lithuanian_economic_review_june_2016