Chemicals industry agreement on starting salaries of new workers

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In July 1998, trade unions and employers in the Spanish chemicals industry signed an agreement with the aim of defining the system for paying the sector's "agreed bonus" to newly recruited workers.

On 14 July 1998, the most representative organisations in the Spanish chemicals industry - the employers' organisation, FEIQUE and the trade unions, FITEQA-CC.OO and FIA-UGT- signed an agreement in Madrid on the interpretation of Article 28 ("remuneration system") of the current 11th general agreement for the chemicals industry (valid from 1 January 1997 to 31 December 1998), relating to the nature of the "agreed bonus" and whether it should be paid to new recruits.

Wages structure of the 11th general agreement

The collective elements of the gross wage, as set out in the chemical industry's 11th general agreement, are the guaranteed minimum wage (Salario Mínimo Garantizado, SMG) - which is the "basic wage of a particular occupational group" - and the "agreed bonus" (Plus Convenio) - which is a common bonus for each occupational group. This bonus unifies the various individual bonuses that existed before the 11th agreement came into force: bonuses for length of service, shifts, night work, arduous work, exposure to toxicity and so on. It integrates these bonuses into a general wage element for all workers in the same occupational group who carry out a single set of duties and tasks and meet the requirements for the group based on a series of factors such as knowledge, initiative/autonomy, complexity, responsibility and control.

The SMG applies obligatorily to all workers in the same occupational group in any company, subsector or region. By contrast, the "agreed bonus" is awarded only when there is a wage surplus from the absorption of the previous corresponding bonuses. This is because not all companies used to have individual bonuses, and therefore had nothing to unify into an "agreed bonus". The "agreed bonus" is now paid only if there is a wage surplus once the guaranteed minimum has been paid. The intention is mainly to bring basic wages into line with the SMG whenever an agreement to this effect is possible at company level. As a guideline, the general agreement establishes the agreed bonus as 35% of the SMG, although this percentage may vary up or down.

Agreement on interpretation of Article 28

The new agreement on the interpretation of Article 28 of the 11th general agreement ratifies the general agreement's definition of the "guaranteed minimum wage" and the "agreed bonus", and the application of the latter, when it is possible to reach an agreement, to workers who fall into the corresponding occupational group, including new recruits: "... in order for new workers to receive the agreed bonus referred to in Article 28 of the general agreement, it is an indispensable requirement that they should be fully integrated into the occupational group to which they belong" (minutes of the extraordinary meeting of the joint commission of the 11th general agreement for the chemicals industry).

Though all the most representative social partner organisations in the sector signed the new agreement, in an annex they state their respective approaches to the interpretation of Article 28. The difference of opinion lies in whether or not the agreed bonus should be applied automatically to the wages of new recruits once they have passed their agreed probationary period. The trade unions are in favour of automatic application, but the employers' organisation is not. The major problem is the interpretation of the phrase "full integration into the occupational group", a condition that was mutually agreed.

Evolution of occupational classification systems

The text of the agreement refers to "the conditions of the job effectively carried out", which "involves the same duties and tasks as workers who are already contracted". These tasks are largely defined in advance by general standards for an entire sector, in a model of occupational classification that has been the prevailing pattern in Spain since the 1930s and relates work closely to experience in a certain job (ES9706110F). This model was reinforced during the Franco régime by the statutory "Labour Ordinances" as compulsory standards for each sector of economic activity at a guaranteed level, including a detailed classification of jobs and their corresponding duties and tasks.

With the Workers' Statute introduced by a democratic government in 1980, the regulation of occupational classification was transferred to collective bargaining between employers' organisations and trade unions. However this capacity for self-regulation by the social partners was not fully implemented until 1994, when certain articles of the Workers' Statute were modified and the Labour Ordinances were replaced with agreements on occupational classification between employers' organisations and andunionsunions. The final expiry date of the Labour Ordinances was set for 31 December 1995.

The main point of reference for the reformed text of the Workers' Statute is the occupational group. The different tasks and duties characteristic of a sector were integrated into homogeneous groups without a strict reference to jobs. This redefinition of the occupational group meant that the traditional requirements of "labour experience" were replaced by a complex set of factors based on concepts such as knowledge, initiative/autonomy, complexity, responsibility and control (in the specific case of the general agreement for the chemicals industry). These were understood as a development of the personal skills of the workers according to the demands of production and prevailing organisational conditions. The general agreement for the chemicals industry played a pioneering role because it was the first agreement that established a new regulation of occupational classifications based on occupational groups, in the early 1980s.

This development from an "objective" definition focusing on the occupational requirements of jobs to a "subjective" definition based more on the occupational skills of workers is set in a context of increasingly decentralised collective bargaining. This process was stimulated by the reform of the Workers' Statute in 1994 and consolidated by the intersectoral "April agreements" on Filling the gaps in regulation and on Collective bargaining signed in 1997 by the most representative employers' organisations and unions (ES9706211F). Of special importance are company agreements, which are coordinated (or "articulated") with the sectoral standards that establish the general principles of occupational classification, wage setting and the determination and quantification of the wage supplements that make up the pay packet.

Commentary

There is today a wide spectrum of different systems of work organisation and sectoral rules about occupational classification, and hence pay is settled in a less "objective" fashion than in the past. The margin for company-level decisions has therefore become wider. So too has the scope for bargaining (and disputes) over the application of sectoral regulations governing occupational classification and pay supplements to specific company situations.

These supplements include the agreed bonus in the chemicals industry. This is why, in its comments in the annex to the agreement on the wages of new recruits, the FEIQUE employers' organisation argues that the agreed bonus should not be paid automatically on the recruitment of new workers after the corresponding probationary period. Instead, the provisions of Article 28 notwithstanding, it should be paid only if they have been effectively integrated into an occupational group. The unions, on the other hand, are in favour of automatic payment of the bonus. The key to the difference in the interpretation of Article 28 therefore lies in how and when to integrate a worker into an occupational group, which the employers' organisation wishes to leave open to negotiation at company level, case by case. Despite the agreement, this question may continue to cause disputes not only within companies but also at sectoral level. (Manuel Sánchez, CIREM Foundation)