Greece: Lenders take unacceptable hard line on worker rights

DISCLAIMER: All opinions in this column reflect the views of the author(s), not of EURACTIV.COM Ltd.

Greek lenders claim they are just calling for changes to bring Greece in line with best international practice. But expert opinion is being ignored. [Giannis Papanikos/ Shutterstock]

In the current negotiations over a new loan package for Greece, collective bargaining and worker rights have been in the spotlight. But expert opinion in favour of these tools is being ignored by Greece’s lenders, warn Jan Willem Goudriaan and Richard Pond.

Jan Willem Goudriaan is General Secretary of the European Federation of Public Service Unions (EPSU) and Richard Pond is responsible for trade union rights and collective bargaining.

Both the European Commission and International Monetary Fund (IMF) have made it clear that the reforms of recent years should not be undone. The IMF is calling for further reforms that would reduce trade union and worker rights.

A report by an expert group on labour market institutions set up by the lending institutions (European Commission, European Central Bank, European Stability Mechanism and IMF) and the Greek government reported last September is being directly ignored or misinterpreted, while the Commission and IMF claim they are merely calling for changes to bring Greece in line with best international practice. Greek workers and their unions are not allowed to be the judge of that.

The IMF is explicit in calling for changes to strike rules. In its latest country report on Greece it argues that the legislation on industrial action hasn’t been changed since the 1980s and that this “could explain the large number of strikes in Greece, which even prior to the crisis far exceeded levels seen elsewhere”. The report also says that a ban on lockouts should be lifted.

It is not self-evident that the lack of reforms since the 1980s should justify changes today and the IMF’s statistics don’t support its argument. They are on general strikes and not industrial action in the context of disputes at workplace or sector level.

There is no data on strike action in Greece at these levels. Furthermore, the figures for Greece in the chart are for one year only (2002) and don’t represent an average for the period 2002-2007. This is misleading and sloppy work.

The IMF position also flies in the face of the first two recommendations from the earlier mentioned expert group. The first of these says there is no need for changes to strike rules and the second sees no need to end the ban on lock-outs.

This second recommendation notes in particular that: “The provisions on industrial conflict in Greece have established a balance of power between employers and unions; its rules are accepted by both sides.”

The key issues of the reforms demanded by the IMF and the Eurogroup regarding bargaining are the extension and hierarchy of collective agreements.

The first concerns the extent to which sector collective agreements are extended to cover all workers in the sector and the second is about whether locally negotiated collective agreements can include provisions that are worse than those specified in the relevant sector agreement.

Earlier reforms implemented at the behest of international creditors have suspended the extension and turned the normal collective agreement hierarchy on its head. Further changes have allowed non-trade union “associations” to sign agreements with employers.

It is not clear what best practice the IMF and European Commission are looking at to justify giving local collective agreements favourability over sector-level agreements. While there has been a trend in some countries to allow for derogations from sector agreements in cases of economic or financial hardship, this has not involved a general reversal of favourability between the two levels.

In our opinion best practice is for the unions, employers and governments to judge, not for the European Commission or the IMF to impose on workers

Speaking recently in the European Parliament, Commissioner Vytenis Andriukaitis said: “The suspension of the legal extensions of sectoral agreements and the favourability principle does not mean that collective bargaining has disappeared from Greece.”

In a strict sense he is right, collective bargaining has not disappeared but it has been significantly weakened and is now being carried out under the favourability rule that is the exact opposite of best international practice.

The experts’ report didn’t take a unanimous position here but the majority group (five of the seven) was very clear about what has happened in Greece with “a fragmentation and destabilisation of the system of collective bargaining and an increase of inequality and poverty. Most concerning is that the erosion of collective bargaining with all its negative consequences on wages will continue if the regulatory framework remains as it is.”

This group went on to set out a clear position in support of sector bargaining and general applicability of agreements with 10 cogent reasons for the economic and social benefits of this kind of system, ranging from creating a level playing field for companies to fairer pay and social protection for vulnerable workers. Why is the IMF ignoring this?

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