September 2001 saw the announcement of an agreement laying down personnel policy guidelines to be observed in reorganisation processes in the Norwegian state sector, negotiated by the government and the main trade unions. The deal provides for various support measures for workers affected by a major public sector reform programme.
An agreement laying down personnel guidelines to be applied during reorganisation in the state sector has been negotiated by the government and the main trade union organisations in the sector. The agreement was made public on 5 September 2001. The social partners in the sector have agreed on a set of principles and measures that state sector enterprises may use to support employees who are made redundant, forced to change jobs, or have to move as a result of reorganisation processes. The agreement comes as a result of the government's Programme for innovation of the public sector, which was officially launched by the Minister of Labour and Government Administration, Jørgen Kosmo, on 11 October 2000. The reform programme has proven to be controversial, and the scope of the reform and its consequences for employees in the public sector has not been at all clear. The government thus took the initiative to conduct talks and negotiations with the trade unions concerned.
Innovation in the public sector
The main purpose of the Programme for innovation of the public sector is to 'renew, readjust and increase the efficiency of the public administration in order to make it more adaptable to the needs of the inhabitants and to financial considerations'. The programme stipulates three targets:
- that state organisation and services should be based on user needs;
- that resources should be transferred from public administration to service provision and from sectors with decreasing needs to sectors with increasing needs; and
- that a more effective use should be made of resources and more latitude given at all levels.
The programme thus aims to reduce the number of employees in public sector administration and to transfer more employees to public service provision. The hope is to make those employees being made redundant available to other sectors with a more pressing shortage of staff, such as the health and social sectors and the teaching professions. An estimated 35,000 employees will be affected by reorganisation in the next 10 years and, in order for the programme to succeed, the government believes that close cooperation and significant co-determination with the employees involved is required.
Agreement on personnel management during reorganisation
The reform has met with significant opposition from many quarters, and the main social partner organisations in the state sector were thus invited in the spring of 2001 to take part in working out new personnel guidelines to be used in the processes of reorganisation.
The most significant outcome of the negotiations was the maintenance of the redundancy allowance scheme for state employees who are 'between jobs'. The redundancy allowance scheme in the state sector to some extent grants employees better compensation than the ordinary unemployment benefits scheme. However, the administrative responsibility for the scheme will now be moved from the state pension fund to the Labour Market Administration (Aetat), in order to make the transfer of redundant employees in the state sector to new jobs more effective. Furthermore, the rules will be gradually harmonised with the regulations concerning ordinary unemployment allowances.
The parties also agreed on guidelines for personnel-related measures that may be used in connection with larger reorganisation processes. In the event of employees having to move house as a result of reorganisation, compensation is to be given for moving expenses. Employees forced to take up commuting to and from work may also receive some financial compensation. Furthermore, severance pay is also available, although on the condition that the employees concerned voluntarily terminate their employment. In such cases, older employees will receive higher pay-outs than younger employees. Furthermore, if education and training is necessary for employees to remain in the particular enterprise or in the state sector generally, they may receive financial support for skills development. The guidelines stipulate that employees may receive financial support for up to three years of education and training.
However, there is no automatic right to severance pay or financial support for educational purposes, and such measures will as a rule only be applicable in cases of 'downsizing'. It is further stressed that the extent to which such measures are carried out is left to management to decide.
Another significant result of the negotiations was the government's promise to increase state funding of trade union representatives in relation to the reform. As such, 59 new full-time shop steward posts will be created in the near future, in addition to the 137 already agreed upon in other parts of the state sector (as reported in the Aftenposten newspaper on 9 September 2001). The rationale behind this concession by the government has been to ease the progress towards reform and to maintain co-determination .Such agreements on increased union representation have previously been reached in relation to reforms of hospitals, the police and the armed services. The Minister of Labour and Government Administration, attributes this measure on the need to 'enable smooth and more efficient reorganisation processes and to safeguard a fair treatment of the employees concerned'.
Commentary
The programme for reform introduced by the minority Labour Party (Det Norske Arbeiderparti, DnA) government is not the first time that public sector reform and innovation has been on the political agenda in recent years. The public sector in Norway is absorbing an increasing number of employees in an already tight labour market. There is a general consensus about the need to deal with this problem and to reform the public sector. However, there is little agreement on the actual content of such reform, and how it may be accomplished. The reform programme introduced by the government has thus been subject to significant debate and controversy, not least within the trade union movement. Thus the agreement on personnel policy measures and on extended union representation may be viewed as an attempt to create some calm and a cooperative framework within which the reorganisation processes may take place.
However, there are people and parties on the other side of the political continuum who believe that the recent concessions made to the trade unions are going too far. The Conservative Party (Høyre) views the measures as too costly and argues that the agreement will thus render the cost-saving reform meaningless. Høyre is also opposed to the state's commitment to supply funding for more full-time shop stewards, arguing that the government is bowing to trade union pressure.
However, the use of personnel policy measures in connection with reorganisation processes is not new in the Norwegian public sector. Both financial support for education and severance pay are common measures in connection with major reorganisations, eg in the postal service, the railways and the armed services (NO9712139F). This is partly due to a general wish to avoid too many redundancies. Furthermore, state sector employees enjoy additional rights in connection with redundancies, which place significant financial burdens on the employer. On previous occasions the parties have agreed on 'package deals' within each department or in connection with each individual reorganisation. Thus the new guidelines may be seen as an attempt to standardise measures already in use rather than the introduction of a new type of personnel policy. The introduction of standardised guidelines seems to indicate that the government views reorganisations as becoming a more lasting state of affairs in the public sector. The costs of making use of these measures are borne by each enterprise or department, and they must be carried out within the budgetary framework of each enterprise. (Håvard Lismoen, FAFO Institute for Applied Social Science)