February 21 st 2013 strengthening public services social dialogue in an era of austerity
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February 21 st 2013 Strengthening Public Services Social Dialogue in an era of austerity . Stephen Bach Department of Management King’s College, London [email protected] Presentation structure . Aims of EC funded research project Research approach and model Social dialogue

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February 21 st 2013 Strengthening Public Services Social Dialogue in an era of austerity

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February 21st 2013 Strengthening Public Services Social Dialogue in an era of austerity

Stephen Bach

Department of Management

King’s College, London [email protected]

Presentation structure

  • Aims of EC funded research project

  • Research approach and model

  • Social dialogue

  • Themes:- restriction, resilience & reconfiguration - UK, Czech Republic, Netherlands

Research Questions

  • What have been the main drivers and measures of austerity adopted in each country?

  • How have these changes been implemented and to what extent has social dialogue contributed to the change process at national, sectoral and decentralised level?

  • How have institutions of social dialogue influenced industrial relations processes and outcomes in the public services?

Research Approach

  • Czech Republic; Denmark, France, Italy, Netherlands, UK

  • Phase 1: meeting with social partners

  • Phase 2: analysis of national experience - drivers, measures, outcomes

  • Phase 3: case studies of local government

Drivers of Austerity

  • External/ Internal

  • High/ Low pressure

Austerity Measures

  • Budgetary cuts

  • Staffing policies (e.g. replacement ratios)

  • Alterations in wage fixing

Social Dialogue

  • Tripartism

  • Collective bargaining

  • Joint consultation

  • Cross-border




Austerity Outcomes

  • Employment reductions

  • Wage cuts

  • Pay freezes

  • Pension reform

  • Work intensification

Drivers of Austerity : retrenchment pressures

Source of pressure


Market Reaction


Lagged Response


Coalition for change

Czech Republic



Robust Health



Degree of pressure




Pay Cuts

Czech Republic 10%

Italy 5-10% (linked to earnings)

Pay Freeze

France (2010-2012 index point value)

Netherlands (2011-13 central govt; education)

UK (2011-2013)

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)

Pension Reform

Czech Republic






Social dialogue

  • ‘All types of negotiation, consultation or simply exchange of information between or among, representatives of governments, employers and workers, on issues of common interest relating to economic and social policy’ ILO

  • Tripartism

  • Collective bargaining

  • Joint consultation

  • Cross-border – sectoral social dialogue committees

Social Dialogue: 3 scenarios

  • Restriction – interruption & shift to unilateralism

  • Resilience – institutional maintenance of dialogue - process often more closed/conflictual

  • Reconfiguration – reform of institutional practice - renewal or erosion

  • Variation: between and within national cases


  • National level: austerity programmes and pay - central government - ‘hollowing out’ of national IR

  • Czech Republic

  • Italy

  • UK

  • Severity of cuts: less willingness to engage in social dialogue

UK Restriction

  • Austerity measures 2010- - 2010-15/16 £95 billion expenditure reductions - sectoral variation: local government 27% cut

  • Coalition government policy:- 2 year wage freeze (2011-13); 1% (2013-14) - restrictions on trade union facility time- marketisation/fragmentation

  • Outcomes – main adjustment employment

Consequences: Disputes

Resilience and Reconfiguration

  • Denmark

  • France

  • Netherlands

  • Influences on findings: - employer and union strategy- differences model employer (joint regulation) v. sovereign employer (legal regulation) traditions

Main Findings – Czech Republic


Alexandra Stroleny


  • Extensive reform since the 1990

  • 2010: fiscal consolidation & austerity VS. structural reforms

  • Social dialogue = fragile

Social Dialogue

  • National:

    • 2006-9 govt :Topolánek

    • 2009-10 ‘caretaker govt’: Fischer

    • 2010 -current govt: Necas

  • Sectoral-level: no collective agreements(CA)

  • Enterprise-level: CA possible

    Scope same as before crisis (law almost unchanged)

Main Measures

  • Pension Reform: Public Pillar

  • 10 percent cut in the budget for public-sector wages – excluding teachers

  • public sector pay frozen until 2014shift from automatic progression to pay system based on merit/ performance appraisal

Agreed level of wage increases (%)


  • Austerity

    • Cuts: Employment & wages

  • Social Dialogue

    • Restriction

    • small size of municipalities

Public services in the aftermath of the economic crisis: how social dialogue influences changes in public sector employment relations in the Netherlands

Peter Leisink

Ulrike Weske

Eva Knies

Overview of austerity measures

* Budget cuts in billion of Euro’s

Consequences of quantitative and structural measures


  • wagerestraint/freeze: centralgovernment, primaryeducation

  • employment cuts through efficiency targets instead of nr. of jobs

    • estimated effect: 26.000 jobs until 2015 (almost 10% of totalgovernment jobs)

      Mix of structuralandquantitativemeasures

  • decentralization of responsibilityforspecific public services (provision of shelteredworkplaces, youthcare) tolocalgovernment but withless budget (10-20% efficiency cut)

    Structural reform of employment relations:

  • From traditional employment security to “from job to job” support

  • measuressupporting employees’ employability

Differences between sectors

Differencesbetween sectors in the degree of direct influencebycentralgovernment

  • Central government: Minister of the Interior is alsoemployer

  • PrimaryEducation: Minister of Educationdetermineswagesandprimaryemploymentconditions

  • Hospitals: employersandunions are relativelyautonomous

  • Localgovernment: employersandunions are formallyautonomous; but interferencefromcentralgovernment

    Differences in consequences:

  • wage freeze in central government and primary education but not in local government and healthcare

    Differences in leewayforsocialdialogue

Role of central government (2)

Very strong central government influence

Very weak central government influence








Role of social dialogue

Overall: resilienceof social dialogue institutions and practices

  • Industrial relations actors: no efforts to marginalize the social dialogue; ‘normal’ employment relationships

    Restriction tendencies in central government and education

  • Unilaterally imposed wage restraint/freeze

    Reconfiguration tendencies in local government

  • Sectoral level: collective labour agreement of the future; new substantive arrangements, ideas about rearranging negotiation authority between sectoral and local level

  • Local level: works council Zwolle pro-active participation in plans for job mobility platforms, public-private partnerships


  • Are challenges to social dialogue by shift to unilateralism temporary or more long-term?

  • To what extent is restriction, resilience or reconfiguration dominant....at national, sectoral, enterprise level?

  • How can social dialogue be reformed and strengthened to meet new challenges?

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