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IR Notes 69 – 15 February 2017
www.irshare.eu
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Interview
Karel Fric, Research Officer at European Foundation for the Improvement
of Living and Working Conditions
Can you estimate how many years it
will take for the difference between the lowest minimum wage and
the highest minimum wage, where the ratio is currently 1 to 8.5,
to be significantly reduced? This is a difficult question as we cannot
foresee future economic and political developments. If the current
growth rates were sustained, it would take about 10 years for the
statutory minimum wage in Bulgaria to reach a quarter of the
Luxembourg level. However, current growth rates may not be
economically and politically sustainable. Already now we see that,
in some countries where the minimum wage level has grown rapidly,
the proportion of minimum wage earners appears to be higher than in
countries with moderate growth rates. If future minimum wage growth
is not accompanied by sufficient growth in labour productivity,
employment in certain sectors could come under strain in the long
term. All things remaining equal, it could take another 10 to 15
years before the lowest minimum wage rate in an EU country is about
a quarter of the highest EU minimum wage.
Your report highlights an increase
in collaboration with social partners and expert committees when
setting the minimum wage. Does this collaborative approach lead
governments to increase the minimum wage by more than
previously? I
am not of opinion that the collaborative approach necessarily leads
to higher increases in the statutory minimum wage. Rather, a minimum
wage setting system with transparent rules provides more clarity for
the business sector about future development in the statutory
minimum wage. Moreover, it is less sensitive to the political cycle
and its effects. Similarly, the setting of a statutory minimum wage
is not done in a vacuum and in many countries this has important
implications for the social security network and / or is influenced
by the tax system and changes to it. The involvement of more parties
in the setting of the minimum wage doesn’t make the process
necessarily easier, but the result reflects the needs of various
parties better than if the minimum wage is set solely by government.
On the other hand, an increase in the involvement of expert
committees also means that the social partners lose some of their
autonomy in the setting of pay.
What are the main obstacles to
adopting a minimum wage at EU level as wished by Jean-Claude
Juncker? There are a number of countries which do not
have a statutory minimum wage (such as Austria, Denmark, Sweden,
etc.), and the introduction of such an instrument would mean that
they would have to change their system of minimum wage setting
considerably. In many such countries the minimum wage is set on a
sectoral level in an agreement between the social partners. The
social partners are often opposed to the introduction of the
statutory minimum wage as this would mean that their position could
be weakened. If the proposal included linking the setting of the
minimum wage to the average wage, for example, there would also be
opposition to Juncker’s proposal in countries where a potential
EU-wide approach could lead to a considerable increase in the
minimum wage level. This would be the case in some new member
states. In these countries, employers and possibly also conservative
political parties would be amongst those most opposed to the EU-wide
approach.
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Agenda
16 February Strasbourg Extraordinary
meeting of the Committee on Employment and Social Affairs of the
European Parliament dedicated to the proposed revision of the posted
workers directive.
2
March Paris Eurogip
Discussions on “Occupational
health and safety, a performance lever for businesses“, with
contributions from European social partners.
3-4
April Valletta Informal
meeting of Employment and Social Affairs Council.
28 April
Paris
Conference of the AFDT
(French association for labour and social security law) on measuring the
representativeness of trade unions and employers’ organisations.
29 April
Bordeaux
Comptrasec (Centre for Comparative Labour and Social Security Law) (UMR
5114 – CNRS, a joint research unit operated by Bordeaux University and
the National Scientific Research Centre) is holding an international
and interdisciplinary conference on innovation and protection of
health in the workplace, with Professor Robert Karasek, father
of the job demand/control model for assessing work-related stress.
4 May
Paris
High-level conference organised by the OECD and the Foundation for the
Improvement of Living and Working Conditions on social
mobility and equal opportunities.
15-16
June Brussels Employment
and Social Affairs Council
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IR Notes is a fortnightly
newsletter produced by IR Share
and its network of experts, and is available in several
European languages. It offers Europe-wide monitoring of employment law, labour
relations and employment policy. It is available by subscription for 15 euros
per month (excluding tax), via the IR
Share website. IR Share is a privately- owned,
independent, apolitical company whose aim is to inform and assist all players
involved in social dialogue within and outside Europe. It has been the
correspondent organisation for France and Luxembourg of the Dublin Foundation
since 2009 and for Bulgaria since 2014.
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Lead
story
Acceleration
in minimum wage increases
The European Foundation for the Improvement of Living and Working Conditions
(Eurofound) on 9 February published its annual
report on statutory minimum wages in the EU (in English). The report
highlights: 1/ An acceleration in the growth of minimum wage rates, with marked
increases in the new member states, bringing about a gradual convergence of
minimum wage levels. 2/ A continuing strong disparity, with the minimum wage in
Luxembourg being eight-and-a-half times higher than the minimum wage in
Bulgaria. 3/ A statutory minimum wage exists in 22 of the 28 member states,
although the countries not covered apply minimum wage levels set in collective
agreements. 4/ The report reveals a more collaborative approach to determining
the minimum wage in a certain number of countries, with the involvement of the
social partners and input from expert committees. The results were corroborated
by Eurostat which, on 10 January, published its review of minimum wages. As of 1
January 2015, Eurostat found that minimum wages in the EU varied by a ratio of 1
to 10, a gap reduced to a ratio of 1 to 4 when purchasing power standards are
taken into account (see press
release). In its latest publication, Eurostat states that, as of 1
January 2017, the raw differential has decreased to 1 to 9, whereas the gap is
reduced to a ratio of 1 to 3 when expressed in purchasing power standards (see
press
release). Elsewhere, the report affords a reality check on the plan
supported by the European Parliament to establish a minimum wage in all the
countries of the EU set at 60% of the median gross earnings in each country.
According to Eurostat, the minimum wage has reached or exceeds 60% in only three
countries: Portugal (64%), France and Slovenia (both 62%). While nine further
member states have rates between 50% and 60%, others by contrast are a long way
from the target – Slovakia (46%), Spain (45%), Ireland (45%), Estonia (40%),
Czech Republic (39%). To reach the level of 60% would therefore require a major
convergence effort. These two reports will inform the debates that will be held
as part of the discussions on establishing the European Pillar of Social Rights
and the proposed implementation of a European minimum wage, an objective voiced
again by the European Commission President, Jean-Claude Juncker, on 23 January
(see IR
Notes 68).
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1. European
Union
Legislation
- Working conditions in the fishing sector:
Directive
2017/159 of 19 December 2016 has been published in the Official Journal
of the European Union. It transposes the agreement of the European social
partners in the fishing sector dated 21 May 2012 on the implementation of the
ILO convention relating to work in the fishing sector.
- Exposure to chemical
agents: Directive
2017/164 of 31 January 2017 has been published, establishing a fourth
list of indicative occupational exposure limit values for 31 hazardous chemical
agents.
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Case law
Weekly rest periods taken inside the vehicle do
not constitute rest: The Advocate General of the European
Court of Justice, whose opinion is very frequently followed by the Court when it
issues its judgement, has ruled in a Belgian case with major implications for the
road transport sector (CJEU,
opinion, case C-102/16, Vaditrans BVBA). The case concerns a transport
company which contested a fine imposed because one of its drivers had spent his
weekly rest period on board his truck. The question was to establish whether this
practice is permitted under European social legislation relating to road transport.
Several member states which have incorporated a ban on making drivers take their
weekly rest period on board their vehicle in their legislation believe that the rest
period must be spent outside the truck, while others, such as Estonia and Spain,
maintain that it is quite acceptable for a driver to spend his rest period in his
vehicle, especially in view of improvements in cab comfort. The Advocate General has
given his interpretation of the relevant provisions of European law, that is article
8, paragraphs 6 and 8 of Regulation No. 561/2006. He concludes that “the driver may
not take regular weekly rest periods referred to in Article 8(6) inside the
vehicle”. The European Transport Workers’ Federation (ETF), which had sent a letter
to the European Commission denouncing the practice of making drivers spend their
rest periods in their vehicles, welcomed the Advocate General’s opinion in a press
release.
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Sectoral
social dialogue
- Employability in the sport and active
leisure sector: The European social partners in the
sport and leisure sector have drawn up a joint
opinion on “strengthening employability in the sport and active leisure
sector”.
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2. Member
states
Belgium
- Wording of the interprofessional
agreement: The social partners on 2 February signed the
interprofessional agreement 2017-2018 highlighted in our last issue. The wording
of the agreement is now available.
> Also see press releases of
the FGTB
and CSC
trade union federations and the employers’ organisation FEB.
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Italy
- Agreement on commercial policies in the
banking sector: The social partners in the banking
sector on 8 February signed a national
agreement on sales policies and work organisation which in particular
reflects the issues raised by the “sales vs. advice” campaign launched by the
UNI Global Union trade union federation to prevent abuses relating to the sale
of financial products and protect employees from unrealistic targets (see Frankfurt
declaration, 16 April 2010 and UNI Finance press
release).
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Luxembourg
- Greater flexibility of working
hours: The law of 23
December 2016 on the organisation of working hours entered force on 1
January 2017. One of the key measures allows employers to extend the legal
reference period from one month previously to four months. In return, they must
grant employees additional leave days, depending on the duration of the
reference period. However, as before, the social partners can negotiate a
collective bargaining agreement to extend the reference period to up to 12
months, while at the same time negotiating compensation measures that meet the
needs of both the company and employees. The employers consider the reforms to
be too rigid and costly for businesses (see Practical
guide issued by the Fedil employers’ organisation).
> For an overview of the law, see
the analysis
published by the law firm Arendt & Medernach.
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3.
Companies
European
works councils
Eiffage: The French
construction and concessions group, Eiffage (70,000 employees), on 30 December 2016
signed a new
European works council agreement. The EWC has 22 members (with a ceiling set
at 30) and meets twice a year. The select committee has five members (three from
outside France), who meet quarterly. A representative of the EFBWW European trade
union federation can attend meetings. Between two plenary meetings, the agreement
encourages the management to communicate interim information to the select committee
“in order to help involve the committee more closely in current transnational issues
and group developments”. The EWC can also request information from company
management about the group’s international construction sites. Should a case of
exceptional circumstances arise, the select committee is “previously informed and
convened for a meeting at the initiative” of company management. For such a case to
arise, a decision must affect either at least two countries and involve a
significant percentage of the staff at each entity under consideration when the
problem is one of employment; or else a single country, provided that the importance
of this event necessarily entails a national or transnational impact with regard to
the staff. Members of the select committee may visit the sites concerned. The EWC
has an operating budget of 60,000 euros.
- Geberit: The EWC of the
Swiss Geberit group (“Europe Forum”) will convene on 2-3 March in Munich for an
information and consultation meeting concerning a restructuring plan that
threatens two production sites and 250 jobs in France. Production is due to be
transferred mainly to Portugal, but also to Poland and Italy. The meeting,
secured by the lawyer of the joint trade union body representing the two French
sites, is overdue since the plan was originally presented to representatives of
the French workforce in May 2016. The French consultation process has not been
concluded yet, and the current legal dispute between the trade union
representatives and the management could result in the latter having to start
the process all over again.
- Syndex: Having trained
more than 300 trade union officials and EWC members since 2015 as part of a
European project entitled “Working together for European recovery: workers’
involvement in companies’ future as a cornerstone”, the consultancy Syndex has
placed online a “toolkit” (www.syndex.eu), available in several
languages, as an aid to training for EWC members. The project was managed by
Syndex in partnership with four European trade union federations, the ETF, EPSU,
IndustriAll Europe and UNI Europa.
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Trade
unions
- Axa: Axa’s trade union
alliance, established by the European trade union federation UNI Europa
Finance, has denounced “attacks on the social rights of AXA Group workers”
in a press
release, with reference to the recent termination by management of a
French group agreement concerning a working time account scheme.
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Company-level agreement
- UniCredit: An agreement
signed between the management of the Italian bank UniCredit and the five trade
union organisations affiliated to UNI Finance on the social impact of the plan
to transform the bank will result in 3,900 voluntary redundancies and a scheme
allowing employees to take early retirement up to 54 months before they would
normally retire (see press
release of UNI Finance, in English, of the joint
trade union body, in Italian).
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4. Studies
and reports
Slowdown in offshoring:
According to a report
from the European Foundation for the Improvement of Living and Working Conditions
(Eurofound), the number of cases recorded in the EU of restructuring linked to the
relocation of activities has been in decline since the economic and financial crisis
(see summary).
The study underscores that such relocations were never “a large source of job loss,
despite dire predictions that a very large number of jobs in Europe and elsewhere in
the developed world were potentially offshorable”. Thus, according to the European
Restructuring Monitor (ERM), a tool developed by Eurofound, “between 2003 and 2007,
offshoring accounted for 7% of all announced job loss in the ERM. This declined to
4% in the depths of the recession (2008–2010) and continued to decline to under 3%
in 2015–2016.” The ERM also found that, in manufacturing, offshoring has declined in
the pre-2004 member states – where the share of associated job losses fell from 14%
to 7% between 2003–2007 and 2015–2016 – while it has increased by a factor of four
in the EU13 (from 4% to 15% over the same periods). The destinations of production
offshoring are countries where labour costs are lower.
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