Brussels – 21 February 2013
Social dialogue and the public services in the
aftermath of economic crisis: strengthening
partnership in an era of austerity.
The Italian case
Lorenzo Bordogna – Stefano Neri
University of Milan
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Outline
1. Public sector “social dialogue”
2. Trade Unions
3. Austerity measures in 2008-2012: general
overview
4. Austerity measures in Local government
5. Case studies
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Social Dialogue and Collective Bargaining
Social dialogue and collective bargaining are widely practiced in the
Italian public sector, partly since 1983 and definitely since 1993.
•
Until 1983: Sovereign employer model, unilateralism
•
Since 1993: Model employer approach, the employment
relationship of more than 80% of the about 3,4
million public employees has been privatised and
contractualised
1998-2007: collective bargaining even more enhanced
(autonomy, scope), especially at single employer
decentralized level (with unexpected wage drift)
2009: partial retrenchment of collective bargaining and union
prerogatives (Brunetta reform), but privatisation and
contractualisation not cancelled
•
•
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Social Dialogue and Collective Bargaining
Two-tier bargaining system
1) Nation-wide sectoral level (public schools; central
government; regions and local government; health;
etc.), every 3 years, setting general wage increases,
linked to inflation rates
2) Single employer level (each municipality, region,
university, hospital, etc.), where some wage increases
are allowed, within limits and rules defined at the
higher level (often transcended in the 2000-07 period)
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Bargaining agents
National sectoral level
• ARAN: Public Agency compulsorily representing all
Italian public administrations in national level
negotiations (assisted by the representatives of public
administrations, like the National Association of Italian
Municipalities in the case of the national collective
agreement for Regions and local government)
• Representative Trade Unions
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Bargaining agents
Single employer, decentralised level
• Employer
• Workplace employee representation bodies (legally
based, elected since 1998 every 3 years in each
administrative unit with more than 15 employees) +
local union representatives
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Trade Unions – main features
1. High trade union density (50-60%, 15 to 20 percentage points higher than
in the private sector)
2. High organizational fragmentation with inter-union rivalries (union
belonging to the 3 largest trade union confederations CGIL, CISL and
UIL + a high number of ‘independent’ craft and occupational unions)
3. Legal rules defining ‘representative’ trade unions at national level,
entitled to participate to the negotiation tables and sign with ARAN
collective agreements with general validity. Rules based on precise
quantitative criteria (percentage on total membership and percentage of
support in the elections of the workplace employee representation
bodies)
4. Legally based workplace employee representation bodies elected every 3
years in all administrative units with more than 15 employees. Usually
very high turnover rate (75-80%), slightly declining in the last election of
March 2012
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Reform of public sector employment relations
(2009, under center-right government)
• Partial re-juridification of the employment relationship
• Stronger managerial prerogatives in personnel and
HRM matters vis-à-vis trade unions
• Partial retrenchement of the role of collective
bargaining, embedded in a stricter web of rules and
constraints
• Performance management and performance
assessment systems
The implementation of the reform largely frozen since
2010 because of the crisis
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Austerity measures
both internal and external drivers
All unilaterally decided
• Staff turn-over freeze and cut of resources for fixedterm, temporary contracts
• Suspension of collective bargaining machinery for
2010-2014
• Wage and salary freeze (2010-14) for all employees
(including those still under public law regime)
• Cuts in other personnel expenditures (training)
• Heavy cuts in government transfers to local authorities
• Reform of the pension system, quite tough
(reasons: savings + demographic trends)
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Employment levels and total public sector wage bill, 2007-2011
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Austerity measures for local government
• Domestic Stability Pact (DSP), introduced in 1998
(financial targets for Regions and local government
institutions aimed at public debt containment)
Legal constraints are set to pursue the financial targets:
1) statutory duty to progressively reduce personnel
expenditures
2) pay freeze until the end of 2014
3) total ban on new hirings, if personnel
expenditure/current expenditure > 50%
4) Restrictions to staff turn-over for both permanent and
temporary employees (staff replacement ratios)
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The case studies
Main local government institutions: 8,092 municipalities
(70% with less than 5,000 inhabitants, and 93% less than 20,000)
Two medium-large size were chosen:
1) Modena (Emilia-Romagna, Centre-North of Italy)
• Over 180,000 inhabitants
• 2039 employees at the end of 2011
2) Sesto San Giovanni (Lombardy, North of Italy)
• Over 80,000 inhabitants
• About 800 employees at the end of 2011
Traditionally cooperative relationships with unions (main
union: CGIL) in both the municipalities
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Main critical issues
1) Reduction in the number of staff
(in Modena: -5,5% from 2010 to 2012; -7,2% from 2008 to 2012)
Main cause: due to legal constraints on personnel expenditures
and on staff turn-over
Municipalities are responding to the staff shortage through
externalisation:
a) transferring services to newly-established semi-autonomous
organisations (special companies, foundations), subject to
weaker DSP constraints
b) contracting out the services to third sector organisations
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Main critical issues
2) Increasing difficulties in motivating personnel because of
very limited incentives:
•
pay freeze
•
freeze or denial of economic advancements
•
limited funds for performance-related pay and for
implementing performance evaluation systems (case of
Sesto San Giovanni)
•
cuts in training expenditures
3) Risk of lowering performance level and the quality of
services provided
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Social dialogue and austerity measures
1) Unions insist on internal re-organisation and personnel
mobility as tools to contain staff expenditures without
cutting the number of employees
But so far re-organisation processes have been limited,
difficult to implement
2) Strong union opposition to externalisation because of the
alleged negative effects on terms and conditions of
employment
This effect is due to the shift from the (public sector) national
collective agreement for local government to private
sector collective agreements, with worse pay and working
conditions
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Social dialogue and austerity measures
1) Increasing unilateralism legitimated by
• the 2009 public sector employment relations reform
+
• the need to quickly implement the austerity measures
2) Shift from highly cooperative relationships to conflictual
ones
3) Local variations
• Modena: a «dialogue of the deaf»
•
Sesto San Giovanni: still cooperation but the increasing
union fragmentation due to inter-union rivalries
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emphasizes conflict between the parties
Conclusions
Restriction, Resilience, Reconfiguration
1) At national level, certaiIny a case of restriction
– the Brunetta legislation reformed the institutional framework of
public sector employment relations reducing union prerogatives
and the scope and autonomy of collective bargaining, especially at
decentralized level
– austerity measures suspended the entire bargaining machinery for
the 2010-2014 period
2) More variation at local level, depending also on the
strategy of local actors (ruling coalitions / trade unions)
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