The impact of international institutions on collective bargaining
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1 The impact of international institutions on collective bargaining ILO-EPSU Seminar Decent work for workers in public services Bratislava, 21 April 2015 Dr. Torsten Müller European Trade Union Institute - ETUI
2 Basic assumptions: EU crisis management 1. Crisis is primarily a crisis of cost competitiveness 2. Lowering labour costs is the key to regain (price) competitiveness and to address macroeconomic imbalances!!!
3 EU crisis management New European Economic Governance: A new European interventionism in the area of wage policy through European Semester/European Imbalances procedure Troika /Memorandum of Understanding Policy measures: Direct intervention into wage developments by cutting and freezing public sector and minimum wages Structural reforms of wage setting institutions to increase downward flexibility of wages
4 Intervention into national collective bargaining DG ECFIN 2012: Employment friendly reforms Decreasing bargaining coverage Decreasing extension of collective agreements Decentralizing bargaining systems Removing or limiting the favourability principle Introducing/extending possibilities to derogate from higher level agreements Overall reduction of wage-setting power of trade unions
5 Continuity DG ECFIN approach DG ECFIN 2015: Moreover, major reforms in the labour market, such as decentralised wage bargaining and more flexible wage arrangements, as well as past wage moderation will also support job creation.
6 Measures in countries under international surveillance
7 Country-specific recommendations
8 Cuts and freezes of public sector wages ( ) General wage freeze Troika/IMF countries EL, ES, IE, IT, CY, HU, PT, RO Other countries CZ,DK, EE, F, LT, PL, SL, UK, NL Wage cuts of 5-10% ES, IE, IT, PT CZ, EE, SL, SK Wage cuts of 15-30% EL, LV, HU, RO LT Abolition of additional benefits EL, ES, HU, PT, RO DK, EE
9 Abolition of additional benefits in public service ( ) 13 th /14 th monthly pay Cuts in pension entitlements Accomodation allowance Medication allowance Greece Hungary Portugal Romania Spain Food allowance
10 Eingriffe in nationale Mindestlöhne 22 % cut (32% cut for young workers under 25) in 2012 Freeze until the end of the assistance programme Freeze No MW rise without approval of Troika 1 cut in 02/2011 rescinded in 07/2011 Freeze since 1997 Suspension of automatic Indexation No MW rise without approval of Troika
11 Real compensation in the EU
12 National hourly minimum wages (in Euro, January 2015) Quelle: WSI-Minimum wage database
13 Minimum wage in % of median wage
14 Number of collective agreements
15 Decollectivisation of industrial relations Number of workers covered by registered collective agreements
16 Collective Bargaining Coverage
17 Dominant level of negotiations Quelle: European Commission 2015: Industrial Relations in Europe 2014
18 Trade union density Quelle: European Commission 2015: Industrial Relations in Europe 2014
19 Implications of interventionist approach 1. Systematic undermining of (cross-)sectoral systems of multi-employer collective bargaining 2. Dramatic decrease of collective bargaining coverage leading in parts to a decollectivisation of industrial relations 3. Pressure on wages: deflationary tendencies and downward wage competition with negative consequences for internal demand. TTorsten Müller IG Metall Werkstatt Europa, 17. Juni 2014
20 The impact of international institutions on collective bargaining Thank you very much!!! Dr. Torsten Müller Senior Researcher European Trade Union Institute Bld. du Roi Albert II, Brussels tmueller@etui.org
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