IR Notes

Faced with the threat of a series of strike days announced by its pilots in several EU countries, Europe’s most anti-union airline has just been forced to do a U-turn, which has been somewhat problematic. It all began in Italy, where the Italian airline pilots’ union ANPAC (National Association for Professional Civil Aviation) announced that Ryanair pilots would be staging a four-hour strike on 15 December. The company reacted by publishing a letter threatening that any Italian pilots who took part in the strike would lose their previously agreed pay rises or jeopardize their chances of promotion or transfer. This in turn drew a sharp response from the government, as the authority that guarantees the right to strike: it pointed out that the threat of reprisals against employees who go on strike represents a blatant violation of their constitutional rights and that law no. 46/1990, which provides protection for transport users in the event of industrial action, also penalises any corporate behaviour that might exacerbate the dispute. On 12 December, in Ireland, Ryanair pilots belonging to the Irish Airline Pilots’ Association (IALPA), which is a branch of the Impact trade union, informed their management that a one-day strike was planned for 20 December. In a secret ballot, 94% of the Irish pilots employed directly by Ryanair voted in favour of the strike. “The dispute”, explains the Impact trade union, “relates to management’s refusal to enter into direct negotiations with the European Employee Representative Council (EERC) or with IALPA, which is the only independent representation body for pilots working for the company”. “The airline has so far refused to recognise either EERC or IALPA, and is insisting that any discussions relating to pay and working conditions are conducted by ‘employee representative councils’ which are overseen by management”, adds Impact, which has also threatened Ryanair with further strike days if no agreement can be reached. Ashley Connolly, from the Impact trade union, believes that it was this lack of social dialogue that led to Ryanair’s decision to cancel thousands of flights this summer because it was unable to recruit and retain pilots. Ryanair’s Portuguese pilots also called a strike, for 20 December, to put pressure on Ryanair to recognise the trade union SPAC and to embark on negotiations with it. German pilots also followed suit. In the end, Ryanair agreed to enter into negotiations at the level of each of these countries, by recognising the trade unions behind the industrial action (see Ryanair press release). Clearly, this is an important first step with this company, which detests any form of collective bargaining in its dealings with employee representatives. Ryanair’s boss Michael O’Leary has been a constant critic of trade unions. He also called for the resignation of the Chair of the European Sectoral Social Dialogue Committee for Civil Aviation when the latter published a long list of pilots who worked exclusively for Ryanair, but were registered as self-employed pilots with their own company registered in Ireland. Ultimately, this behaviour was punished by the market, as evidenced by the growth of EasyJet, which has a more virtuous approach to industrial relations, and the criticisms levelled at the company by its shareholders following the announcements of flight cancellations. The level of sincerity that lies behind this return to social dialogue now remains to be seen (see press releases issued by the trade union federations ETF and ITF and by the European Cockpit Association).

• Results of the Employment and Social Affairs Council meeting: on 8 December, the Council approved a general approach on the accessibility directive, which will make it easier for people with disabilities to access products and services (see press release). The Council also reached partial agreement on the regulation relating to coordination of social security systems. This agreement covers the chapters on long-term care provision and family benefits. The text is also now being scrutinised by the European Parliament, where the Employment and Social Affairs Committee is due to express its view on the report drawn up by Guillaume Balas (S&D), which amends the European Commission’s proposal. The Council also reached an agreement on the directive on the Maritime Labour Convention, which will provide better working conditions for seafarers (see press release) and formally adopted the directive on protection against exposure to carcinogens or mutagens in the workplace (see press release).


• Legislative priorities for 2018-2019: on 14 December, the European Commission, the Council and the European Parliament adopted a joint declaration on the EU’s legislative priorities for 2018-2019 to speed up the legislative process for 31 new initiatives (see press release) along with other initiatives that were already included in the joint declaration 2016 (see press release). The priority texts in the area of social affairs are as follows: 1. revision of the regulation on the coordination of social security systems; 2. revision of the directive on the posting of workers in the framework of the provision of services; 3. revision of the directive on the protection of workers from the risks related to exposure to carcinogens or mutagens; 4. proposal for a directive on accessibility requirements for products and services for people with disabilities; 5. proposal for a regulation laying down the legal framework of the European Solidarity Corps.

Study of digitalisation in the chemical industry: on 8 December, the European chemical industry social partners (IndustriAll Europe and ECEG) published a brochure setting out their work programme for 2018-2020 (other languages) and their achievements over the past three years. They committed themselves to a new work programme for the period 2018-2020 (see press release). One of these actions is the EU-funded project on “the impact of digital transformation and innovation in the workplace: a sector-specific study of the European chemical, pharmaceutical, rubber and plastics industry”.

• Work programme in the rail industry: on 1 December, the European railway social partners (ETF and CER) adopted a work programme for 2018-2019 that devotes particular attention to the rail freight industry. The social partners have also announced joint activities in terms of safety, employability, digitalisation and integration of women into the workforce (see press release).

• Exemption from social security contributions to promote cycling: the Council of Ministers has approved two draft royal decrees concerning a number of benefits granted by the employer, such as a cycling allowance and a benefit covering PCs, mobile phones and tablets. The first project seeks to encourage commuters to use a bicycle to travel to work, by providing a cycling allowance for bikes fitted with pedal assist up to 45 km/h, and making a bike and its accessories available, including maintenance and storage costs. In future, these two benefits will also be exempt from social security contributions (see press release).

• Court overturns a “Molière clause” for the first time: on 13 December, for the first time, an administrative court overturned a clause in an invitation to tender issued by a French region, and requiring companies involved in a project, firstly to provide a certificate signed on their honour that they will not employ any posted employees, and secondly to guarantee that their employees, regardless of their level of responsibility, can speak French. The region’s stated aim was to ensure that it had “no posted workers employed on its projects”. Citing the Treaty on the functioning of the EU and directive no. 2014/24 of 26 February 2014 on the awarding of public procurement contracts, the Lyon administrative court held that this clause had been adopted “not for the purpose of protecting employees’ health and safety, but to exclude posted workers from regional public procurement contracts and to promote regional companies”.

Wilsonart: on 22 November, the American laminate products manufacturer Wilsonart (which employs 4,500 people) signed an agreement on a European Works Council for its staff in Germany, France, Poland and the United Kingdom. The agreement includes a provision covering the consequences of Brexit, which will allow British representatives to retain their positions once the United Kingdom agrees on the continuity of directive 2009/38 or on a similar continuity of European workers’ rights. If this legislation is not extended, British representatives will continue in post until their term of office expires but they will not have any voting rights and they will not be re-appointed. Each country appoints a representative once it has at least 50 employees. These representatives must hold a mandate to represent staff at local level. Deputies may attend European Works Council meetings held in their own country. The European Works Council may be convened in exceptional circumstances, even when the planned changes affect only one member state, if these changes are of “such importance that they will inevitably have a significant impact on staff in other member states”. An exceptional circumstance is defined as “the occurrence of a serious work-related accident with far-reaching consequences for workers’ health and the viability of the European company”. It is clearly stipulated in the information and consultation process that management must not implement any measures until the consultation procedure involving the European Works Council comes to an end. The agreement allows an independent expert to be called in and invites a trade union expert appointed by the IndustriAll European trade union federation to attend all meetings.

Unicredit: on 28 November, the management of the Italian banking group Unicredit and its European Works Council signed a joint declaration on work-life balance (in Italian). This is a first for the European banking sector (see press release, in Italian). The European Works Council had already signed a number of declarations with management on issues such as training, equal opportunities, non-discrimination and responsible sales. This declaration seeks to address the impact of digital technology and socio-economic change, which is altering employees’ expectations in terms of work-life balance. With this declaration, the parties are establishing a common approach, guidelines and principles for promoting social dialogue on the issue of work-life balance in all of the group’s countries and companies. The declaration focuses on five broad areas: 1. digital technology, with the aim of preventing any form of intrusion into workers’ private lives or breaks; 2. space and time flexibility at work; 3. time management at work to maximise quality and effectiveness of time during working hours; 4. wellbeing; 5. cultural change, to move towards a corporate culture based on “work-life balance” and “inclusion”. The implementation of the joint declaration will be jointly overseen by the select committee of the European Works Council and the group’s management.

Tata Steel – ThyssenKrupp: in September, Thyssenkrupp and Tata Steel announced their intention to create Europe’s second-largest producer of flat steel, within the framework of a joint venture to be called “thyssenkrupp Tata Steel”, which will be owned on a 50/50 basis and have its head-office in the Netherlands. This new entity is expected to employ 48,000 people on 34 sites and to produce 21 million tonnes of steel per annum, with an estimated annual turnover of 15 billion euros. In the first instance, a restructuring plan is expected to involve 4,000 job losses. Under the auspices of the European union federation IndustriAll Europe, trade unionists from the two groups met in Brussels, on 7 December. They adopted a declaration in which they urge the company to refrain from cutting jobs and closing sites, and to honour information, consultation and participation rights, including that of codetermination (see press release). A further coordination meeting is scheduled for 10 January.

• Shell: on 10 December, unions affiliated to IndustriAll Global Union organised a day of action to demand that Shell “respect the human rights of all its employees, wherever they work” (see press release).

Growth in expenditure on social protection in the EU: on average, expenditure on social protection across the EU accounted for 29% of the national wealth of Member States in 2015, representing an increase on the figures for 2010 (28.6%) and 2014 (28.7%). This average masks a number of major disparities: seven countries spend at least 30% of their gross domestic product on social protection, but in nine countries (seven in Eastern Europe, plus Ireland and Malta) this expenditure ranged between 15% and 20% of GDP. The countries that spend the highest proportion of their GDP on social protection are France (33.9%), followed by Denmark and Finland (both 32%), and then Belgium, the Netherlands, Austria and Italy (30%). Old-age and survivors’ pensions accounted for 45.2% of all social benefits and were the main item of social protection expenditure in virtually every country. Furthermore, sickness, health care and disability benefits accounted for 37.3% of all social benefits. In fact, “the bulk of this expenditure goes on pensioners if we take into account pensions and health care spending, around half of which is spent on the over-60s”, notes Bruno Palier, CNRS research director at the Centre d’Études Européennes and co-director of Liepp.