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Trends in collective bargaining in the EU Final conference: “Collective bargaining in Croatia and EU today” Zagreb, 14 October 2015 Dr. Torsten Müller European Trade Union Institute - ETUI
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Megatrends as challenges for trade unions and CB 1.) Structural change: Manufacturing to services Increasing privatisation of public sector 2.) Increase of precarious and and atypical forms of employment 3.) Globalisation makes national regulation more difficult 4.) Neoliberal hegemony – reinforced by crisis Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015
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Main trends in collective bargaining systems across EU 1. Change in political framework conditions: unprecedented degree of direct political interventions 2. Different modes and degrees of decentralization in collective bargaining structures 3. Spread of company-level employment and competitiveness pacts Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015
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EU crisis management Basic assumptions: 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!!! Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015
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EU crisis management New European Economic Governance: A new European interventionism in the area of wage policy through European Semester/European Imbalances procedure: half of the EU Member states received recommendations 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 Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015
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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 Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015
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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.” Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015
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Country-specific recommendations 2011-2014 Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015
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Measures in countries under international surveillance Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015
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Abolition of additional benefits in public service (2008-13) Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015 GreeceHungaryPortugalRomaniaSpain 13 th /14 th monthly pay Cuts in pension entitle- ments Accomo- dation allowance Medication allowance Food allowance
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Eingriffe in nationale Mindestlöhne Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015 22 % cut (32% cut for young workers under 25) in 2012 Freeze until the end of the assistance programme Freeze 2011- 2014 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
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National hourly minimum wages (in Euro, January 2015) Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015 Quelle: WSI-Minimum wage database
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Minimum wage in % of median wage Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015
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Real compensation in the EU 2010-2014 Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015
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Number of collective agreements Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015
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Decollectivisation of industrial relations Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015 PortugalSpain 2008201320082013 Agreements 2959459873161 Of which company 954845392274 Extension1379 Workers covered 1.8 mio242,00012 mio8.5 mio
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Collective Bargaining Coverage Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015
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Dominant level of negotiations Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015 Quelle: European Commission 2015: Industrial Relations in Europe 2014
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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. Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015
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Organized de-centralization in northern European countries (Inter-)sectoral agreements define the terms of transferring bargaining competences to lower levels Tools: Company-level employment pacts State-sponsored schemes for temporary working time reductions and lay-offs Path-dependent adjustment of existing multi-employer bargaining systems Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015
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Wages and collective bargaining under deflation: alternative approach ● Stabilising and enforcing wage developments: counter deflationary price developments stabilise and increase private demand counter income inequality ● Requires … stop of wage cuts and wage freezes wages increase at least in line with productivity and target inflation more expansive wage developments in the surplus countries ● Requires … strengthening of wage setting institutions Dr. Torsten Müller – Collective bargaining in Croatia and EU today, Zagreb, 14 October 2015
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Thank you very much for your attention!!! Dr. Torsten Müller Senior Researcher European Trade Union Institute Bld. du Roi Albert II, 5 1210 Brussels Email: tmueller@etui.orgtmueller@etui.org Dr. Torsten Müller – ILO-EPSU Seminar, April 2015 Trends in collective bargaining in the EU
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