BNA Daily Labor Report: Good Relations Between Unions, Employers Said to Help EU Weather Economic Crisis

March 9, 2011: Good labor relations between employers and trade unions helped the European Union through the economic crisis of 2008-2010, a European Commission report said March 3.

Employers and trade unions agreed to minimize job losses by shortening working hours, which enabled companies to retain skilled workers over the severe economic downturn, the report said.

The annual Industrial Relations Report 2010 also said continued good relations are needed to improve weak competitiveness in some EU countries.

“The member states where social partnership is strongest are those that are successfully overcoming the crisis,” EU Employment Commissioner Laszlo Andor said in a statement.

Economic powerhouse Germany is seen as the prime example of successful cooperation between employers and unions. German export companies retained their qualified staff through Kurzarbeit programs, shortening the workweek while the government provided partially unemployed workers with benefits for the rest of the time.

“We have to emerge from the crisis with more and not less social dialogue—this will also help bolster the competitiveness of Europe's economy,” Andor said.

Industrial Relations Vary Among EU Nations

However, he noted that the industrial relations traditionally have varied among the 27 EU member states.

“Social dialogue is still very weak in many of the countries that joined the EU in 2004 and 2007, yet building solid partnerships between workers' and employers' representatives is precisely what will help these member states on the road to recovery,” the employment commissioner said.

Twelve countries, mostly ex-Communist nations in Central and Eastern Europe, joined the European Union in 2004 and 2007.

In six of them—Poland, the Czech Republic, Slovakia, Estonia, Latvia, and Lithuania—the crisis led to employers and trade unions signing national cross-industry agreements for the first time.

In total, 18 EU countries saw trade union federations and national employers' organizations signing agreements, either between each other or with the government. Besides the six eastern EU countries, the other 12 were: Germany, France, Italy, Spain, Belgium, the Netherlands, Luxembourg, Denmark, Finland, Austria, Bulgaria, and Slovenia.

The report also noted the continuing trend of further decentralization of wage negotiations toward the company level and not at a national, sectorial level. Collective bargaining is still strong in Europe and two thirds of all workers are covered by a collective agreement.

Trade union membership of workers continued to decline slowly, the report said, down to 31 percent in the EU in 2008 from 37 percent in 2000. The variations among the 27 member states were significant, from 69 percent union membership in Sweden in 2008 to below 8 percent in Estonia. Membership of employers' organizations remained stable.

About 2 percent of EU workers had been involved in a strike each year of the 2000-2008 period. This level was lower than the 1970s, 1980s, and 1990s, the report said.

Figures varied greatly among EU countries, with very high numbers of strikes for Greece, Italy, and Spain, and very low figures for Germany, Poland, and Sweden.

Text of the report may be accessed here.

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