Transcript Document

Social Dialogue and the Recession
Stavroula Demetriades
Head of Unit, Industrial Relations & Workplace Developments
Introduction


EIRO Information Updates from January 2009 to
August 2009 – around 140.
Additional desk research, Eurostat and ERM data,
ILO and OECD reports etc.

Data processing: September-October

Main focus: Practices at national level
European Economic Context
GDP volumes percentage change quarterly
(Q/Q-4)
4
EU 27
3
2
1
0
-1
-2
-3
-4
-5
-6
06q2 06q3 06q4 07q1 07q2 07q3 07q4 08q1 08q2 08q3 08q4 09q1 09q2
Recession’s impact on the Labour Market
Unemployment % from July 2008 to July 2009
20
Age 15-24
18
16
Total
14
12
Male
10
8
Female
6
July Aug Sep Oct Nov Dec Jan Feb Mar Apr May June July
Recession’s impact on the Labour Market
Unemployment % in the Member States
20
18
Aug-08
16
14
July 09*
12
10
8
6
4
2
0
ES LV LT EE* IE SK HU FR PT SE GR* FI
PL BE DE UK* IT* MT BG LU CZ RO* SI DK CY AT NL
2005=100
09-2009
06-2009
03-2009
12-2008
09-2008
06-2008
03-2008
12-2007
09-2007
06-2007
03-2007
12-2006
09-2006
06-2006
03-2006
12-2005
09-2005
Euro area, seasonally adjusted series
EU27, seasonally adjusted series
06-2005
03-2005
12-2004
09-2004
06-2004
03-2004
12-2003
09-2003
06-2003
03-2003
12-2002
09-2002
06-2002
03-2002
12-2001
09-2001
06-2001
03-2001
12-2000
09-2000
Some increase in output..
Euro area and EU27 production,
total industry excluding construction
Trendline
Trendline
110
105
100
95
90
85
But Unemployment rate (EU 27)
still on the rise…
Projections





Global growth:
-1.1 % (2009) +3.1 (2010)
USA:
-3.4
+1.3 %
emerging and
developing econom: +1.7 +5.1%
Euro area forecast: -2,7 (2009), +1,5% (2010)
Unemployment projections: 39 (2007) to 59 million
(2009) ILO
Social Dialogue


Most countries have used Social Dialogue in the form of tripartite
institutions, ad-hoc bodies, informal meetings, collective bargaining
(various levels)
Member States with active tripartite consultation


Little or none Social Dialogue at national level


Belgium, Netherlands, Nordic countries, Slovenia, Spain
Greece, Ireland
Social dialogue but .. what results?

Romania, the Baltic Countries, Hungary
Short time/flexi time practices





With or without Collective Bargaining
Short time to reduce labour costs at enterprise level. Sometimes coexists with
governmental measures to compensate the affected workers
Examples Germany (Kurzarbeitergeld), Austria, Estonia, Spain, Netherlands,
Belgium, France (partial unemployment), Denmark etc.
But also… Temporary lay-offs (Sweden) for a pre-defined period with or
without public support
Although there are national differences, working week is usually shortened with
unemployment funds to the employees while not working & training

Sectors mostly used the scheme: Manufacturing, Automotive (incl. suppliers)

ATTENTION: temporary nature and combination with employability
Some figures on use of short time





Austria: take up in Feb 09 27,600 workers
Belgium: 289,381 blue collar workers in Feb2009
for at least 1 day, an increase of 70% since Feb2008
Germany: Short time workers from 137,000 Nov
2008 to 700,000 in February 2009
DK: work-sharing increased from 33 cases in 2006
to more than 500 cases (over 12,000 workers) in
first 2 months 2009
FR: 146,000 workers on partially unemployment in
last Q2008
Upgrading skills to ensure employability

Government support:

Bulgaria: 150,OOO people to be trained

IT (Fund for employment and training)

Germany, Federal State 2bill for 2009-10

Sweden: € 960 mill activation measures, including
training, traineeship (2009)


UK, “ALL under 25y” strategy
BUT also, social benefits and minimum wages
Collective bargaining on flexible working time
Company cases

Daimler

Schaeffler group

JCB (UK)

Scania
The JCB case





UK based world’s third largest manufacturer of construction
equipment
18 plants, 9,000 employees worldwide, including 11 factories
and 6,000 employees in the UK
What was the problem? Falling sales > loss of more than 500
jobs
Agreement Mng- GMB trade union, over 2,500 members at 7
JCB plants
Cuts in weekly working time from 39 to 34h over 4d a week
(=13% reduction), workers loose £61/w pay but compensated
by statutory “guarantee payments”
The Scania case






Swedish commercial vehicle manufacturer
What was the problem? Falling sales
General agreement on temporary lay offs in manufacturing
industry
Scania agreement following a ballot (for 6 months)
20% cuts in w.time and 10% decrease in pay, freeze on wage
increases in 2009, cuts in holiday pay
Job guarantees for 6 months, 12,000 workers affected
Saves € 27,5 mill
Plus .. training
All good and nice?




Well, almost….
Slovenia, Mura textile company
Greece, Alumil, big aluminium
company
Ireland, Lufthansa
Pay development in the shadow of the
crisis

Only indicative signs

Moderate wage increase

Public sector deeply affected

Collective bargaining: decrease or freeze wages in some sectors and
companies
And.. the agreements of the crisis?




Belgium:Limitations to net annual pay increases to
Euro 375 over 2 years plus measures to protect
workers’ purchasing power
Spain: disagreements on pay increase, trends for
wage freeze
Estonia: Pay freeze in public sector
Ireland: No agreement
Is that all?
Quid pro quo for some countries (for the time being)
 Finland: higher increase? Yes, but increased importance of
company level and %
 Austria: Metal working, higher increase? Yes, but more
innovative, flexible, profit sharing schemes
 Estonia: More basic pay please and less performance related
pay
Industrial Action

Protests over the social consequences of the crisis
The European day of action

Overall level of industrial action: low

The role of EU level institutions






Coordination of economic, employment and social
policies (as well as peer meetings), Control of state
aid
EU economic recovery plan
Financial support to companies (i.e. European
Investment Bank)
European Social Fund / Globalisation Fund
Social dialogue
AND beyond Europe: Global meetings
Why Social Dialogue matters in times of
crisis?






IR institutions play a major role during the crisis: coordinated bargaining,
employee representation, in the workplace, regular consultation AND..
social partners’ capacity
A, BE, D, DK, E, FI, NL, SK, SI, SE
But.. E, EL, H, IE, PO, R, LV, LT faced difficulties building up consensus,
mainly NMS (structural problems?)
TU views: job losses, flexibility but not security, wage cuts, green jobs,
social costs
Employers’ views: financial stability, industrial competitiveness, ageing,
flexibility, skills, innovation
CB at Sectoral and company level was proved to be successful, close to the
problems at hand
Why Social Dialogue matters in times of
crisis?





S.D: a significant factor in containing negative
consequences of crisis
Major disagreement: who pays for the cost of the crisis
The role of the state has been proved to be critical
Crisis and impact on SD..
Next challenge: Rethink existing measures; preparing
for the exit from the crisis

Budgets, socio-economic policies appropriate for the times,
new sustainable jobs
http://www.eurofound.europa.eu/
http://www.eurofound.europa.eu/eiro/
Thank you!