Collective Bargaining

1
Collective Bargaining

• Definition
• Basic negotiation theory
• Features perspectives
• Levels
• Phases
• Social Partnership
• The future?

2
Collective Bargaining

• ..the process through which agreement on pay,
  working conditions, procedures and other
  negotiable issues are reached between organised
  employees and management representatives.
• (Gunnigle et al 1995)
• The resolution of conflict through compromise.
• (Hawkins 1979)

3
Negotiation is

• A basic means of getting what you want from
  others.
• It is back and forth communication designed to
  reach an agreement when you and the other side
  have some interests that are shared and others
  that are opposed.

4
Negotiation Methods

• (A) Distributive
• Win-Lose Adversarial Model
• (B) Integrative
• Win-Win Problem solving model
• Inevitably a combination

5
Collective Bargaining

• Features
• Negotiation compromise
• Representatives
• Collectively
• Prerequisites
• Employees free to organise
• Employers recognise representatives

6
Collective Bargaining

• Advantages
• Means of airing grievances through orderly
  negotiation
• Flexible
• Redress balance power
• Involves workers
• Requires consent
• Manages conflict

7
Collective Bargaining

• Disadvantages
• Emerges from employers failure
• Conservative
• Discourages change
• Only marginal improvements
• Lowers expectations
• Voluntarist

8
Collective Bargaining

• Depends on your Perspective
• Unitarist Pluralist Marxist

9
Bargaining Structure

• REGIONAL INDUSTRIAL NATIONAL
• MULTI-EMPLOYER
• SINGLE EMPLOYER
• ESTABLISHMENT MULTI- ESTABLISHMENT

10
State Strategy and Pay Determination
Neo-corporatism
Neo-liberalism
Auxiliary state
Roche, W. 1997, Pay Determination, the State and
the Politics of Industrial Relations,in Irish
Industrial Relations in Practice, second
edition, ed. T. Murphy and W. Roche, Oak Tree
Press, Dublin, pp. 145-226.
11
Neo-corporatism

• Collective bargaining over pay directly tied to
  government decision-making particularly in the
  areas of economic and social policy
• Trade unions and employers gain influence over
  public policy areas important to their
  constituencies (taxation, employment creation,
  social programmes)
• In return, they deliver the approval of their
  constituencies for pay moderation, industrial
  peace
• Practiced in Ireland from 1970s

12
Neo-corporatism
Tripartite agreement (plus farmers, plus plus
social pillar)
State
Trade unions
Employers organisations
13
Collective Bargaining

• Pre-war
• During war
• 1946-1969 Wage Rounds
• 1970-1981 National Wage Agreements
• 1982-1987 Decentralised Bargaining
• 1988-Date National Tripartite Agreements

14
Collective Bargaining

• 1987 shift towards Neo-corporatist Approach
• Government intervention ? tripartite
• Debate over macro-economic concerns
• Consensus in the national interest
• PNR ? PCW ? PESP ? P2000 ? PPF ? SP

15
Social Partnership Agreements

• Common elements
• Pay,
• Taxation, employment, macro-economic stability,
  health expenditure, social inclusion, education,
  training and infrastructure.

16
SPAs How They Differ

• Some allowance of local level negotiations
• Increasing length and complexity of agreements
• Increased attention to social issues
• Increased focus on economic sectors
• Commitment to minimum wage (P2000)
• Decision to undertake benchmarking for the public
  sector (PPF)

17
Social Partnership(Underlying features)

• Voluntary
• Terms cover members of ICTU and IBEC
• Political influence
• Delivery of constituencies
• Employers different interests/abilities to pay

18
Emergence of Social Partnership Why?
Economic situation in 1987
19
Emergence of Social Partnership Who?
Farming organisations 1988
Trade unions 1988
Government
Employers organisations 1988
Community platform 1997
20
Why participate? - Unions

• Higher taxation levels lead to decreased
  disposable income
• Low paid members unprotected by wage floor
  increased pay dispersion threatened labour
  solidarity
• Public sector pay falling behind private sector
  pay
• Increased unemployment lead to falling trade
  union numbers
• Concern that the emergence of the PDs signalled a
  move to neo-liberalism

21
Why participate? - Employers

• Pay rises outstripping inflation continuing
  threat to competitiveness
• Concerns about tax/social welfare systems
• Concerns about government borrowing

22
Why participate? Government

• Fiscal crisis required union acceptance of
  undesirable policies
• Recognition by Fianna Fail of an opportunity to
  attract voters from Labour
• Fianna Fail campaigned in 1987 on a platform of
  fiscal conservatism (without cuts to social
  welfare payments) and support of a return to
  centralised pay agreements

23
Why participate? Farmers

• Employment in agriculture declining at a rate of
  almost twice the EU average
• CAP reform threatened to reduce farm income
• Depopulation of rural areas

24
Why participate? Community Platform

• Representation of those who are often excluded
  from the governance process
• To hold the Government and social partners
  accountable for objectives concerning income
  distribution and social exclusion

25
SPAs The Process
Report by NESC establishes estimates policy
framework
Social partners and other interested parties
submit position papers
Social partners negotiate agreement
Social partners take agreement to their
constituencies for a vote
New national agreement
26
Programme for National Recovery (PNR)

• Foreign debt
• Unemployment
• Emigration
• Unsustainable pay rates
• The Bankrupt State

27
PNR (1988-1991)

• Drastic economic situation ? low wage
  expectations
• Very modest wage increases
• (3 on first 250 pw, then 2)
• 1 hour reduction in working week
• Reduced personal tax
• Commitment to job creation
• No strike clause

28
PNR

• National plan for growth economic recovery -
• creation of a climate conductive to economic
  growth
• Greater fairness in tax system
• Generation of employment
• Reduction of social inequities

29
Programme for Economic Social Progress (PESP)

• Sustained economic growth generation of
  greater income -
• Assault on L.T. unemployment
• Development of greater social rights
• (within health, education, social welfare
  housing)
• Promotion of social responsibility (re. Tax)
• Development of employee participation, womens
  rights consumer rights

30
PESP (1991 1994)

• Healthier economic climate ? higher expectations
  -
• 4 year 1, 3 year 2, 3.75 year 3
• 3 local bargaining clause
• (new technology, quality, productivity,
  flexibility)
• Long-term unemployment
• Union recognition

31
PCW (1994 1997)

• Focus on competitiveness -
• 7.5 pay increase (over term)
• Increase numbers employed
• Reduction in tax
• Union recognition
• Local level partnership
• (employee involvement)

32
P2000 (1997-2000)

• 7.25 2 local element
• Reduce numbers paying tax at 48
• Financial aid for start-up or expansion
• Enterprise level partnership
• Rights of A-typical workers
• Union recognition (crisis)

33
Programme for Prosperity Fairness (2000-2003)

• - 15 over 33 months
• no local bargaining clause (ability to pay)
• - Public Service linking pay to performance
• - Partnership financial aspects
• - Industrial Peace Labour Court role
• - Personal tax
• No-one below min wage 80 at standard rate

34
PPF Social Pillar

• Social Welfare
• Child Benefit
• Availability of childcare
• Review of legislation
• (family friendly policies)
• Anti-poverty
• Housing
• Public transport

35
Sustaining Progress (2003 -)

• Seven point plan presented by government to
  unions and employers
• Pay deal 7 over 18 months benchmarking full
  implemented by June 2005
• Compliance parties in breach of the agreement
  brought to LRC and then LC for binding
  determination
• Union representations improvements in terms of
  right to bargain but no agreement on formal
  trade union recognition

36
SP

• Seven point plan
• Redunancy terms improved
• Minimum wage statutory rise to 7 per hour by
  2004
• Affordable housing initiative
• Inflation measures to be negotiated between
  government, business and trade unions

37
SPAs Do they work?
Source Central Statistics Office, Statistical
Yearbook of Ireland, 2003
38
SPAs Do they work?
Source Central Statistics Office, Statistical
Yearbook of Ireland, 2003
39
SPAs Do they work?
Source Central Statistics Office, Statistical
Yearbook of Ireland, 2002
40
SPAs Do they work?
Source Eurostat, Economic Portrait of the
European Union, 2003 and European Monetary
Institute, Annual Report 1996
41
Other Outcomes from Social Partnership

• Real disposable pay
• Social welfare provision
• Health spending
• Employment legislation
• Union influence
• Competitiveness
• Industrial peace

42
Is Social Partnership the only explanation for
economic success?

• Yes! SPAs provided a
• Stable IR environment
• Stable wage setting environment
• Forum to discuss difficult economic problems

• No! this was a period of
• Constant international economic growth,
  particularly in US
• Large increases in FDI attracted by the IDA

43
IRN 29/05/03

• The relationship between the phenomenal economic
  growth of the Celtic Tiger years and the social
  partnership process has been the subject of
  considerable debate, producing much heat but
  little light. Neither the proponents of the
  process nor its detractors have landed a
  knock-out punch, because establishing the precise
  impact of social partnership or neo-corporatism
  is, by its very nature, an elusive quest.

44
The argument for

• - Increased take-home pay
• - Low inflation
• - Low interest rates
• - Increased profitability
• - Employment growth
• - Controlled social spending
• - Industrial peace divided
• (Gunnigle et.al. 1999)

45

• It is not difficult to understand why policy
  makers would be reluctant to abandon a policy
  which has been associated with so much success.

46
The argument against

• The current social partnership model is facing a
  crisis
• - Social inclusion
• - The model is redundant
• - Private Vs Public sector
• - Participant commitment
• - Undermines the voters right to choose

47

• The social partnership model which has persisted
  since 1987 will only be abandoned if one of the
  social partners feels strongly enough that opting
  out of the model would better serve their
  strategic interests
• Gunnigle et.al. 1999

48
Social Partnership Delivers Nothing on
Homelessness

• Affordable housing was an IBEC demand
• Voluntary Community pillar were not really
  involved this time
• SIMONs proposals ignored
• They recommend a No vote

49
Sustaining Progress?? SIMONs Critique

• No financial provision for social inclusion
• No indication as to how existing (flondering)
  measures will be progressed
• Budget 2003 ensured that commitments under PPF
  would not be delivered
• Social welfare increase under budget 6 ie.
  30cent above inflation a drop in real terms

50

• We, like all other organisations committed to
  social justice, are faced with a much more
  fundamental challenge.
• The government is intent on reducing social
  partnership back to merely a pay deal. We must
  find a way of putting real partnership back on
  the table. SIMON 2003

51
Summary

• Many are committed to this model
• Others think that it is past its sell date
• Still others believe that it could, but does not,
  deliver to the most vulnerable in society
• Should this Social Partnership be kept, altered
  or abandoned?