Technology industry joins the crusade against comprehensive collective bargaining

Helsinki (26.03.2021 – Heikki Jokinen)

The employers’ association, the Technology Industries of Finland announced on 25 March that it will pull out of the national collective bargaining system. It has established a new association, which will henceforth handle all matters connected to collective bargaining.

According to the Technology Industries, its 1,600 member companies can then freely decide whether they want to join the national collective agreement, drafted by the new association, or make their own company level collective agreements.

However, the intention of this whole maneuver is pretty clear: to terminate the generally binding collective agreements in the technology industry.

In Finland a collective agreement is usually seen as generally binding when it covers more than half of the employees in any given branch. Then all employers in the same branch are obliged to follow the minimum salaries and other terms of work set in the collective agreement.

For this reason the scope of collective agreements in Finland is seen as being relatively high by international standards. In the latest study a total of 89 per cent of wage and salary earners in 2018 were covered by collective agreements. In the private sector the figure was 84 per cent.

It is very uncertain whether the new association will be able to gather so many member companies that it can make generally binding collective agreements in the future. It will most probably make so-called normally binding collective agreements, adhered to only by those companies that sign it.

The rest of the companies will make their own company level collective agreements – or refuse to make any at all, as the forestry giant UPM announced recently regarding their salaried employees.

Huge work ahead

Riku Aalto, President of the Industrial Union says that the technology industry is now taking a leap in the dark. He sees the employers’ new negotiation structure as an endeavour to weaken the generally binding character of collective agreements.

He also points out the extensive task the employers’ new association would have. It will assume its new role in August and the existing collective agreements of the technology industry are due to expire at the end of the year.

“Do they now think in the employers’ palace that up to 1,600 collective agreements will be negotiated for workplaces within a couple of months in the Autumn? Quite a job ahead”, Aalto says in the union press release. And these negotiations will be conducted directly by companies without any experience of collective bargaining.

The chairpersons of the trade union confederations are at a loss to understand the employers’ decision. Jarkko Eloranta, President of SAK sees it as a clear attempt to dismantle the system of collective bargaining.

“It is the branch specific collective agreements that are the basis of labour market agreements. These create stability and predictability for employees and companies”, Eloranta says.

Sture Fjäder, President of Akava points out that the timing of the decision is bad. In these turbulent times we badly need good cooperation and a willingness to compromise.

STTK President Antti Palola views the decision as a new step by the employers in a long time goal to break the Finnish model of collective bargaining and move collective bargaining to company level only.

“The tone set by the forest industry and now continued by the technology industry is clear and becomes louder. It might be only a matter of time before other employers’ associations adopt a similar position.”

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