Monday, November 9, 2015


At the start of his mandate (November 2014), the Christian Democratic oriented EU President Jean Claude Juncker from Luxembourg, decided to relaunch the European Social Dialogue. On 5 March, a high-level summit in Brussels brought together the EU-level cross-industry and sectoral social partners together with the European Commission to discuss ways to strengthen social dialogue. On 19 March, the Tripartite Social Summit looked at the contribution of the social partners to investing in growth and creating jobs. And on 21–22 April in Riga, an informal meeting of EU Ministers for Employment and Social Affairs held as part of the Latvian Presidency examined the role and future development of social dialogue.

The European magazine “Foundation Focus” number 17 of September 2015 gives special attention to the state of the European Social Dialogue. There is a common feeling that the European Social Dialogue is in crisis. “Collective industrial relations, including social dialogue, have undergone dramatic change over recent decades, with a shift to predominantly service or knowledge economies, greater individualisation in society at large, and the growth of female employment and changing gender roles bringing issues of work–life balance, care arrangements and working-time patterns to the table. And economic change is a key driver of the role of social dialogue. After the financial crisis of 2008, the issue of European social dialogue slipped down the policy agenda in the face of more immediate economic concerns. Strengthening social dialogue to enable social partners to address socioeconomic issues in Europe more effectively has, from its outset, been a declared key task of the new Juncker Commission.” (the editorial)

As part of this relaunch of the European Social Dialogue a special report on “Collective bargaining in Europe in the 21st century” was recently (4 November) published by Eurofound, Publications office of the European Union, Luxembourg. Authors: Eckhard Voss, Katharina Schöneberg and Ricardo Rodriguez Contreras. It is a very thorough academic report with much detailed evaluation of the Collective Bargaining Systems and nature of the Social Dialogues in the different countries of the EU. It is clear that the 2008 crisis has hit the different European countries in a different way. Changes are related to the existing organizational capabilities and strength of the employers organizations and trade unions, the nature of the Governments, the actual economic situation etc.

The executive summary of the report ends with a paragraph on the need to find a new balance in the collective Bargaining Process. The impression is that the report stresses the importance of a collective bargaining process that is much wider oriented than setting wages and working conditions on company level. Social Dialogue and Collective Bargaining processes should be on national level and also contain wider macro economic goals like reduction of income inequalities, settling labor disputes, job creation, fiscal policies etc.

This study has shown that, with few exceptions, most EU countries since the late 1990s have been reporting accelerated change in their collective bargaining practices and systems.
All EU countries have faced globalization and increased pressure on costs and productivity; continuous economic and financial uncertainties; an unprecedented level of unemployment; technological change; demographic, employment and social changes and risks; increasing income inequalities; skills gaps; and the need to adjust training systems. These challenges are changing the role of, the problems to be addressed by, and the actors involved in collective bargaining. As a result, existing regulations and standard collective agreements are being challenged by the combined pressures of flexible work organization, costs, outsourcing and shareholder value, especially where regulations and agreements cover entire sectors or national economies in a standard way. This, in turn, has created pressure for organized as well as more disorganized and fragmented decentralization in all EU countries, accompanied by major strains and a weakening of the regulatory power of employer organizations and trade unions at national level.

The map shows “The intensity of change in collective bargaining since 1997

"A major result of this study in this context is that since 2008 the gap has broadened between countries that are characterized by a comparatively high organizational strength of social partner organizations, stable and influential practices and institutions of various forms of tripartism, and a broad collective bargaining agenda, on the one hand, and countries where industrial relations actors, processes and outcomes are weaker, on the other hand. For example, in terms of the membership density of trade union and employer organizations, all the countries that have experienced the strongest decline in density since the end of the 1990s are located in central and eastern Europe, whereas all the countries that report relative stability are in western Europe. But not only is there a growing gap; in terms of the influence of tripartism and tripartite practices on public policies, the shrinking group of countries where influence is reported to be significant and goes beyond symbolic action or mere dialogue, consultation and information are also located in western Europe. Similar features emerge with regard to the influence of social partners and concertation on anti-crisis programmes or social policy packages in response to labour market problems. A further clear result is that there is a stark contrast between those (few) countries that report a stable situation and a broadening collective bargaining agenda that covers not only core items but also contributes to coping with major economic, social and other challenges and those countries that have experienced a significant narrowing of bargaining agendas during the past decade. The latter group consists of many countries in central and eastern, north-western and southern Europe." (pages 54 and 55 of the Report)

Taking account of all these developments and often contradictory trends (polarization or asymmetric convergence in terms of more flexible procedures, but also divergence in terms of national dynamics and the effects of the crisis), along with changes in the regulatory influence and orientations of national governments and European institutions, the following questions in regard to the current and future role of collective bargaining arise, based on two approaches:

- Will collective bargaining at company level keep on reducing its core functions as a mechanism for setting wages and incomes within a corridor that is mainly determined by firm performance, competitiveness and productivity?

- Or will there also be above that level a wider dimension of collective bargaining in regard to social integration, equality, avoiding unfair competition, and influencing employment and working conditions as well as income and wealth distribution more broadly, and not only limited to employees covered directly by bargaining agreements?

This research suggests that the evolution of these narrow and wider dimensions of collective bargaining since the late 1990s has been characterized by a growing imbalance, to the detriment of the wider and more solidarity-oriented dimension. At the same time, it has become clear that there are still examples throughout Europe where this more normative role of collective bargaining is alive and has even been revitalized in response to social and labour market challenges.
Accordingly, it is acknowledged that collective bargaining provides a solid foundation for progress and growth in the EU Member States, not only by setting wages and working conditions as core functions, but also by supporting the reduction of income inequalities. In addition, it comprises an intangible asset for industrial relations, building up mutual trust between actors, easing the settlement of labour and industrial disputes, and contributing to the general macroeconomic development at national level and better company performance.”