European Trade Union Institute, ETUI.

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Industrial relations in Greece - background summary

The trade union movement in Greece is made up of two main confederations: GSEE (General Confederation of Greek Workers) for workers in the private sector and workers in undertakings under public control (banks, public transport, the post office, electricity and water suppliers), and ADEDY (Civil Servants’ Confederation), representing public sector employees exclusively (education, ministries, local authorities, public hospitals).

About one fifth of Greek workers belong to a trade union. The rate of unionisation is higher in the public than in the private sector, where trade unions have very little influence, especially in small and medium-sized enterprises.

Greek law provides for three levels of trade union organisation. The basis is the first level trade unions, which are legally autonomous and their activities are governed by law. After that the second level organisations, which are either sectoral or occupational federations or regional organisations, known as work centres. Lastly, the third level structures are confederations such as the GSEE, made up of second level organisations. Organisation at the lower level is still highly fragmented. The GSEE comprises about 150 second level organisations (68 sectoral/professional federations and 79 regional work centres). ADEDY is essentially organised according to ministry (31 federations).

The main employer organisations are: the Hellenic Federation of Enterprises(SEV), which originally represented the main industrial undertakings and now also represents major undertakings in other sectors (a member of BusinessEurope), the Hellenic Confederation of Professionals, Craftsmen and Merchants (GSEVEE), which represents small industry and craft SMEs in particular (a member of UEAPME), the Hellenic Confederation of Commerce and Entrepreneurship (ESEE), representing in particular SMEs in trade (a member of UEAPME and EuroCommerce) and the Association of Greek Tourism Enterprise (SETE), representing the tourist trade(hotels, travel agencies, transport, etc.).

Traditionally, collective bargaining took place at national, sectoral/occupational or company level. Before the crisis the General National Collective Agreement (EGSSE) was the first pillar of collective autonomy, usually negotiated every two years between the social partners; this formed the basis from which improvements could be negotiated at the other levels.

Rapid change in employment relations

The changes introduced after the debt crisis in2010 and adjustment programmes have radically changed work relations and the bargaining structure and drastically altered the balance of power between the social partners.

The reforms of the collective bargaining system and wage formation in recent years are part of the domestic devaluation strategy under Memoranda I and II (MOUs), the main aim of which is to reduce labour costs by rapidly cutting wages. These ‘structural’ reforms have fragmented and destabilised the collective bargaining system, drastically reduced nominal wages and resources (contributions) for the social security system and led to a rise in inequality and poverty.

After seven years of painful implementation of economic adjustment programmes, the Greek economy and Greek society are still facing serious uncertainty (unsustainable debt, prolonged economic depression, disinvestment, extremely high unemployment, steady decline in real income and wages, financial instability). Businesses are constantly closing down, bargaining autonomy is in jeopardy and collective agreements are being eroded, drastically reducing the scope of the trade union organisations.

1.      The collective bargaining system in Greece before 2010

The collective bargaining system prior to 2010 was based on Law 1876/1990, adopted unanimously by the political parties, which establishes a multi-level bargaining system with four types of collective bargaining agreement (CBA) for the private sector: the national general intersectoral agreement (EGSSE), then national sectoral or occupational CBAs, local sectoral or occupational CBAs and company CBAs (there are no collective agreements in the civil service, since wage formation is defined by law).

Nationally, the trade union and employers’ organisations negotiate the national general collective agreement (EGSSE) laying down minimum employment conditions and the national minimum wage. The State is not involved in the negotiations between social partners, but makes the minimum wage that they set a statutory requirement. On that basis, national or regional collective agreements can be signed for various sectors or occupations, or collective agreements for enterprises.

Before the crisis and the changes that were imposed, the collective bargaining system was balanced and fully compliant with European and international legal standards. In particular it is characterised by the linkage between the different levels of collective agreement on the principle of the most favourable agreement for workers, a high level of implementation of different types of agreement encouraged by the right of extension (high rate of cover, over 80 %) and the important role of the Mediation and Arbitration Service (OMED) in resolving problems caused by deadlock in the collective agreements.

2. Changes since 2010 (Memoranda I and II)

Following the reforms imposed by Memoranda I and II (2010 and 2012), the collective bargaining system has been radically restructured and dismantled. Attention need only be drawn to the main changes such as the suspension of the favour principle [1] and extension of CBAs, mandatory decentralisation to company level through the primacy of company agreements over sectoral/occupational agreements, the possibility for non-trade union representatives to sign agreements, the forced expiry of CBAs and the restriction on the rules applied, the neutralisation of arbitration, the 22 % nominal reduction in the minimum wage set by national agreement (32 % for the under-25s) by Act of the Ministerial Council and also the restriction of the role of the national agreement (EGSSE),in that it no longer sets the minimum wage (set by the State since 2012) and now only applies to employers belonging to the signatory employers’ organisations (see reforms).

Although the 1990 Collective Agreements Act has not been abolished, the collective autonomy system has been seriously affected by ‘surgical strikes’. The legislative choices made have dismantled the whole system of autonomous bargaining and the collective regulation of employment conditions. The changes initially allowed company agreements to reduce the nominal wages set by the sectoral CBAs and then made individual employment contracts the main formative factor for employment conditions, particularly wages (see reforms).

In November 2012, following complaints from the Greek trade union organisations (GSEE, ADEDY, etc.), the ILO Committee on Freedom of Association called on Greece to bring the labour relations system back into line with fundamental rights. [2]

The government elected in January 2015 wished to reinstate collective bargaining but faced strong opposition from creditors. The bill drawn up by the government (April 2015) for reinstatement of collective bargaining and gradual restoration of the minimum wage to its 2012 level was submitted to the Greek Economic and Social Committee (OKE) for consultation, but was never tabled in the Greek parliament due to pressure from the Troika based on the claim that this was a ‘unilateral act’ not compatible with the adjustment programme.

3.      Memorandum III (2015)

According to the Euro Summit statement on 12 July 2015, [3] the Greek Government needs, in agreement with the Institutions, ‘on labour markets, [to] undertake rigorous reviews and modernisation of collective bargaining, industrial action and, in line with the relevant EU directive and best practice, collective dismissals, along the timetable and the approach agreed with the Institutions. On the basis of these reviews, labour market policies should be aligned with international and European best practices, and should not involve a return to past policy settings which are not compatible with the goals of promoting sustainable and inclusive growth’.

Memorandum III, signed by the government and the creditors (August 2015), provides for a review by a group of independent experts of the existing arrangements for collective bargaining, trade union action and mass redundancies. Three severe conditions are imposed: (a) legislative initiatives by the Greek Government must first be approved by the creditors,(b) the new arrangements must be aligned with ‘best European and international practices’ (best for who?) (c) the changes in labour market policies must not involve a return to rules laid down in past policies, which are deemed incompatible with the goals of sustainable and inclusive growth.

The group of experts presented its report in September 2016. [4] It recommends in particular reintroducing the setting of the minimum wage by the social partners (majority decision), reinstatement of the extension of sectoral agreements (unanimous decision), reintroduction of the favour principle (majority decision). No changes are recommended to the current system for the right to strike and no recommendations are made as to the mass redundancy threshold. Those issues are currently being discussed by the Greek Government and the creditors (March 2017) in the second review of the adjustment programme.

[1] Application of the agreement most favourable to workers where multiple CBAs exist.