rcn june 14 th 2013 the impact of austerity on collective bargaining and employee participation: the...
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RCN June 14th 2013
The impact of austerity on collective bargaining and employee
participation: The local government experience
Stephen Bach
King’s College, London [email protected]
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Presentation structure • EC funded research project:
- Czech Republic; Denmark, France, Italy, Netherlands, UK
• Findings:- Comparative data: drivers and outcomes - UK: national/local picture
• Themes- can social partnership survive austerity?- variations between countries and within - restriction, resilience and reconfiguration
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Research Questions 1. What have been the main drivers and
measures of austerity adopted in each country?
2. How have these changes been implemented and to what extent has social dialogue contributed to the change process at national, sectoral and workplace level?
3. How have institutions of social dialogue influenced industrial relations processes and outcomes in the public services?
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Austerity Outcomes•Employment reductions•Wage cuts•Pay freezes•Pension reform•Work intensification
Austerity Measures• Budgetary cuts • Staffing policies (e.g. replacement ratios)• Alterations in wage fixing
Drivers of Austerity • External/ Internal•High/ Low pressure
Social Dialogue• Tripartism
• Collective bargaining•Joint consultation
•Cross-border
Social Dialogue• Tripartism
• Collective bargaining•Joint consultation
•Cross-border
ReconfigurationResilience Restriction
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Drivers: General Government Consolidated Gross Debt
EU 27 CZ DK FR IT NL UK27.0
37.0
47.0
57.0
67.0
77.0
87.0
97.0
107.0
117.0
127.0
20082009201020112012
% GDP
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Drivers: General Government Deficit/ Surplus
EU 27 CZ DK FR IT NL UK-11.8
-9.8
-7.8
-5.8
-3.8
-1.8
0.2
2.2
4.2
20082009201020112012
% GDP
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Market Reaction
Italy
Market Reaction
Italy
Coalition for change
Czech Republic Netherlands
UK
Coalition for change
Czech Republic Netherlands
UK
Lagged Response
France
Lagged Response
France
Steady State
Denmark
Steady State
Denmark
Source of pressure
Degree of pressure
Low High
External
Internal
Drivers of Austerity : retrenchment pressures
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Outcomes
Pay Freeze
France (2010-2012 index point value)
Netherlands (2011-13 central govt; education)
UK (2011-2013)
Pay Cuts
Czech Republic 10%Italy 5-10% (linked to
earnings)
Pension Reform
Czech Republic DenmarkFrance
ItalyNetherlands
UK
Employment reductions
Czech Republic (5.5% 2009-12)
Denmark (2%: 2010-12)France (5% state
administration 2008-10)Italy (10% 2008-14)
Netherlands (cuts planned up to 2014)
UK (12% 2008-12)
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Social Dialogue: 3 scenarios
• Restriction – interruption & shift to unilateralism
• Resilience – institutional maintenance of dialogue - process often more closed/conflictual
• Reconfiguration – reform of institutional practice: redirected to different ends
• Variation: between and within national cases
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Resilience and Reconfiguration
• Denmark • France • Netherlands
• Influences on findings: - employer and trade union strategy - different institutional/legal traditions e.g. works councils
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Restriction
• National: austerity programmes/pay freezes:- little input from employers and unions - ‘hollowing out’ of IR: time scales- legislative/budgetary instruments dominate
• Czech Republic• Italy • UK
• More engagement at sectoral/enterprise level
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UK Restriction
• Austerity measures 2010- - 2010-15/16 expenditure reductions - 27% local government
• Coalition policy: marketisation & fragmentation - 2 year wage freeze (2011-13); 2013- 1% award - civil service: facility time; review of T&Cs- NHS: resilience e.g. social partnership forum
• Outcomes – employment, disputes
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Public Sector Employment by main Industry
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012300
500
700
900
1,100
1,300
1,500
1,700
UK
head
coun
t (th
ousa
nds)
, sea
sona
lly a
djus
ted
Public Administra-tion
NHS
Of Which: Civil Ser-vice
Other health & social work
Source: Office for National Statistics
Education
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Consequences: Disputes
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130
20
40
60
80
100
Working days lost in the Public Sector
Working days lost in the Private Sector
Number of stoppages in the Public Sector
Number of stoppages in the Private Sector
Average
thou
sand
s, no
t sea
sona
lly a
djus
ted
Source: ONS
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Local govt: differing role for social dialogue
Coastal City Mid-Town
Background Unitary Council; Conservative: 2008- 2012, Labour: since 3 May 2012
District Council2004-2010: NOC Labour 2010 – present
Population 236,900 (2011 Census) 151,900 (2011 Census)
Workforce Size (Headcount)
6,550 (4,940 FTE) as of 2012 Q2 1,206 (1,140 FTE) as of 2012 Q2
Social Dialogue Limited Extensive
Union exclusion High Low
Employment Reduction
Many Few
Pay Reductions Yes, unilaterally imposed Yes, removed increment; introduced partnership payment
Changes to terms & conditions
Yes, unilaterally imposed Yes, by local collective agreement
Industrial action Yes No
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• Social dialogue: restriction after 2010
• Conservative led council proposed: - pay cuts on a sliding scale (2-5.5%)- aim: 400 fewer job losses
• Issues: - trust in employer – job losses/lack of dialogue - unilateral change in terms and conditions
• Local elections in 2012:- wage cuts partly reversed after Autumn 2012 - dispute ended – despite job loses (temp staff)- further cuts anticipated
Coastal 2010-2012
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• Externalisation: - reinforced low trust ER climate - procedural errors enabled union legal action (lack of HR expertise)
• Unilateralism: wage cuts
• Trade union strategy: - recognised dispute of national significance - selective ‘smart’ strikes - legal action (built on employer errors)- political campaign in local election
Coastal Themes
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Mid-Town Resilience and reconfiguration
• Social dialogue: Intensive - conversion: from joint consultation to partnership forum
• Employer approach: - in-house services retained and refocused - support for living wage provision in supply chain
• Partnership payment agreed 2011-2013:- freeze contractual increments - bonus: 2011/12 – @£400 linked to outturn - employee eligibility: attendance and appraisal
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Mid-Town Implications
• Scope for social dialogue:- limited institutional requirements for dialogue - mixture of direct and indirect involvement
• Resilience and reconfiguration: - influence of lack of national pay award - built workforce acceptance for change (choice?)- reconfiguration around progression/increments: individualised performance - attendance, appraisal
• Implications for national framework
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Conclusions
• Findings: - political domain/scope for unilateralism/centralism- adverse effects for public service IR: - driver of change but also limits modernisation - an employer of choice? – shortages, engagement
• Issues:- Are challenges to social partnership & shift to unilateralism temporary or more long-term?
- How can social partnership be reformed and strengthened to meet new challenges? - HR role (visibility/influence)
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References/Further information
• Project website:• http://www.kcl.ac.uk/sspp/departments/management/
Social-Dialogue-and-Austerity-EU.aspx
• IR in Europe Report 2012: (focus on public services)• http://ec.europa.eu/social/keyDocuments.jsp?type=0
&policyArea=0&subCategory=0&country=0&year=0&advSearchKey=IRIE&mode=advancedSubmit&langId=en