Unions and employers step into new social dialogue design

Social partners meeting at the Tripartite Social Summit before the European Council on 20 March. [European Commission]

In the aftermath of the economic crisis, and the push by European Commission President Jean-Claude Juncker to revive social dialogue, unions and employers’ organisations are starting to shape a modus operandi that will help them recover power and influence both in Brussels, and in national capitals.

Meeting at an EU Presidency conference in Riga on Tuesday (31 March), European and national social partners are testing ways to move forward both bipartite and tripartite social dialogue.

“We need a broader consensus on the right policy path and strong support for reforms from social partners,” said European Commission Vice-President Valdis Dombrovskis, opening the conference.

“I believe this is the only way to create the conditions for sound and sustainable growth, to tackle high levels of unemployment, in particular among young people, and to give our citizens more opportunities for better employment,” he continued.

The Juncker Commission mantra for the coming years rests on three pillars: fiscal consolidation, structural reforms and investment, and social partners, all of which have a role to play in both helping devise and implementing reforms.

“Economic growth is not a matter for EU institutions or public authorities, but mostly for social partners,” said Jordi Curell Gotor, Director for Employment and Social Legislation, in the European Commission’s DG for Employment, Social Affairs and Inclusion.

Bottom-up social dialogue

While social partners and labour market experts stress the autonomy of bipartite dialogue, they do see the value for new forms of engagement.

Even though social dialogue is not a panacea, it is part of the solution, said Rie Vejs Kjeldagaard, Deputy Regional Director for Europe at the International Labour organisation (ILO). “Europe is capable to overcome the crisis and get out stronger,” she argued.

But where do we start? Echoing the Commission, Renate Hornung Draus, Chair of the Social Affairs Committee at BusinessEurope said that social dialogue starts at the grassroots.

“If we don’t start it at the grassroots, we will not get it right at EU level,” she argued.

Bridge the disconnect

The disconnect between the national and the European level was loudly repeated by both social partners and public authorities.

“The real problem is that bipartite social dialogue is not in the DNA of every country,” said European Trade Union Confederation Deputy Secretary-General Patrick Itschert noting that some countries are better than others.

>>Read: Commission seeks to revive battered social dialogue

Capacity building for social partners is part of the equation. EU officials said the Commission was ready to allocate part of the European Social Fund (ESF) to foster better communication between the social partners’ layers.

Itschert offered the view that at least 2% of the ESF should be allocated to capacity building.

Since social dialogue traditions vary greatly from country to country, there is a need for national authorities to provide the proper coordination framework. “We need to get it right, but not formalise it too much,” added Hornung Draus.

Revival tools

In the framework of the new EU economic governance set up, the so-called ‘European Semester’, the European Commission is trying to heavily involve social partners with the assumption that if they are properly engaged, unions and employers will own the reforms and help them implement them.

In the framework of the EU semester, member states are expected to produce National Reform Programmes by mid-April. These will provide input for the Commission’s Country-Specific Recommendations in May.

Member dtates received the economic assessment of their economic and social developments or “Country Reports” three months earlier than in previous years, in order to facilitate the input.

To foster social partners’ active involvement in the process, the Commission has dispatched national coordinators in most member states. These are supposed to ease the partners’ input in the country-specific recommendations before the end of April.

“We have to use this time wisely and constructively,” Dombrovskis said to social partners. “We need to discuss which reforms work and where things are not moving in the right direction,” he added.

The Commisssion is also trying new ways to boost EU tripartite dialogue in a more informal way. The testing ground will be the public consultation on the proposal for a Council recommendation on integration of the long-term unemployed, part of the 2015 Work Programme.

“This is not a 100 meter-race but a marathon,” added Itschert, insisting that the idea is to make progress not only for the European Semester, but tp have a better exchange between the national and the EU level on all policy areas that touch the labour market.

The EU executive has identified other areas where the contribution of social partners will be particularly important, such as the Energy Union, the Digital Single Market, and the deepening of the Economic and Monetary Union with its related social dimension, said Dombrovskis.

Showcasing Latvia and Finland

Even though Latvia has a very immature social dialogue, according to the latest industrial relations comparative survey, it managed to pull together social partners around an ambitious reforms plan.

“During the economic downturn, Latvian social partners had to make courageous decisions in supporting unpopular budget cuts and reform plans of the government. But, without their consent and commitment, Latvia could not have achieved the much-needed budgetary and economic reforms,” said Dombrovskis.

The country has made a remarkable turnaround. For several years, Latvia has been among the fastest-growing economies in the EU. This year, economic growth is expected to reach 2.9% of GDP and to accelerate to 3.6% in 2016, and unemployment has also estimated to fall from around 11% this year to 9.2% in 2016, said the Commissioner, encouraging Latvian partners to share their experience with their counterparts in other EU countries.

Finland’s new social partners agreement on pension reform was also flagged as a bottom-up initiative that can foster better involvement of unions and employment. “The fact that social partners have helped design it will make it more impactful,” noted Curell Gotor.

In a move to give new impetus to social partners’ relations, on 5 March, the European Commission launched a new start for social dialogue. European social dialogue refers to discussions, consultations, negotiations and joint actions involving organisations representing the two sides of industry (employers and workers). It was launched 30 years ago in Val Duchesse, and was aimed at involving the European social partners in the internal market process.

>> Read: Commission seeks to revive battered social dialogue

Latest Eurostat figures show that In 2014 the average hourly labour costs (excluding agriculture and public administration) were estimated to be €24.6 in the European Union (EU) and €29.2 in the euro area3 (EA18). However, this average masks significant gaps between EU member states, with the lowest hourly labour costs recorded in Bulgaria (€3.8), Romania (€4.6), Lithuania (€6.5) and Latvia (€6.6) and the highest in Denmark (€40.3), Belgium (€39.1), Sweden (€37.4) and Luxembourg (€35.9).

  • 21-22 April: European employment and social affairs ministers meeting in Latvia (EPSCO Council)

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