Civil service industrial relations move towards market sector model

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During 1999, efforts continue to "normalise" industrial relations in the Dutch civil service, with the goal of eliminating remaining discrepancies with the market sector wherever possible. However, tough collective bargaining and court cases brought against the government by works councils clearly indicate that the process is not quite finished.

On 3 November 1997, the Lower House of the Dutch Parliament passed a motion calling for the government to investigate the conditions under which the "specific status" of civil servants (ambtenaren) could be abolished. For many years, the unique status of civil servants has been used to justify giving them a legal status that differs from that of private sector employees. However, specific legislation in various areas has resulted in a narrowing of the disparities in legal status between civil servants and private sector employees. The Equal Opportunities Act, the Working Conditions Act and the Working Hours Act now include identical regulations for civil servants and private sector employees, and efforts are currently being made to "normalise" industrial relations in civil service employment in other areas too. Here we take a more detailed look at collective bargaining over terms and conditions of employment and at the degree of employee participation in the civil service.

Collective bargaining: moving towards the market sector

The right of trade unions to engage in collective bargaining in the civil service is laid down in separate, specific legislation. Experiments aimed at normalising the civil service collective bargaining process have been underway since 1988, with the primary goal of achieving fully independent bargaining over terms and conditions of employment at the level of the individual sectors of the civil service. To this end, the Minister of Internal Affairs has pursued the following objectives:

• to introduce the possibility of differentiating terms and conditions of employment by sector;

• to create an equal relationship between the social partners in the civil service; and

• to maintain sufficient coordination within and between the respective sectors.

At present, the civil service comprises the following sectors: state, defence, education, law enforcement (police force), judiciary, municipalities, provinces and water-management authorities. The issues which are negotiated at sector level include wages, general working time and general supplementary provisions on sickness and unemployment insurance (that is, over and above the legal norm). Bargaining results in agreements which, although generally accepted as such, are in fact not collective agreements. These agreements are incorporated into public law, and then then applied to individual civil servants by administrative decision.

Application of this "sector model" has changed the system used to establish the degree of financial leeway to pay for terms and conditions of employment across the various sectors. With effect from autumn 1998 - the start of the second term of the "purple" coalition government (NL9809198F) - wage trends in the market sector have been taken as the benchmark for establishing the amount available for the civil service. However, the cabinet reserves the right to deviate where necessary. The new model applies both to the civil service and to the semi-public (gepremieerd en gesubsidieerd, or G&G) sector.

Government clashes with unions

Difficulties have plagued negotiations in the civil service and G&G sector over 1998 and 1999. Disputes have surrounded the bargaining process for law enforcement (police force) and education sector employees (NL9901118F and NL9901120N). The government has re-emphasised the importance of wage moderation, especially since economic prospects are growing bleaker by the month. However, the unions believe that civil servants should now finally profit from the high growth figures achieved over recent years. Negotiations for civil servants began in early March 1999. The Minister of Internal Affairs Bram Peper, as the employer, initially offered a 1.6% pay increase on an annual basis, while the unions brought a wage demand of 3.5% to the negotiating table. The Minister has since increased his offer to 2.25% on an annual basis. The unions strongly oppose the Minister's resolution to tighten sickness costs and introduce forms of performance-linked payment. Negotiations in the higher vocational education sector have likewise run aground.

Works councils in the civil service: undermining political primacy?

Since 1995, the Works Councils Act (Wet op de ondernemingsraden, WOR) has applied to the civil service, with the exception of limited parts of the government apparatus. Works councils are now operational virtually throughout the civil service.

During the parliamentary debate on introducing the WOR into the civil service, a great deal of attention was paid to the relationship between political decision-making and employee participation. Various parties in the Lower and Upper Houses voiced their concerns about employee participation jeopardising what became known as "political primacy". Discussions resulted in two amendments to the Act:

• the works councils' rights do not extend to political decision-making, unless such decisions affect employee interests; and

• certain government officials are expressly excluded from participating as bargaining and consultation partners of the works council.

The fear that works council participation could possibly harm the primacy of politics is not entirely unfounded. Various works councils have already emerged from court victorious after opposing government decisions. In July 1997, the works council for the "Rotterdam" waste-treatment and sanitation department (Roteb) brought an appeal against a decision to privatise parts of the department. Roteb's works council argued that it had been unjustly denied a say in the matter. The employer told the court that the decision being contested by the works council related to the definition of its tasks in terms of public law and was thus not an issue for the works council, whose powers extended only to decisions with potential consequences for employees. The court maintained that lawmakers did not intend to restrict works council rights more than strictly necessary to protect political primacy. Even where political aspects play an important role in decision-making, it still does not mean that the works council is not entitled to consultation rights and the related right to appeal.

In subsequent cases too, the Enterprise Section of the Amsterdam Court of Appeal, which serves as the competent court regarding disputes over works councils' advisory powers, upheld the position that only under exceptional circumstances may the participation rights of civil service works councils be limited. In 1999, for example, several municipal works councils representing areas surrounding The Hague have successfully opposed a decision to expand the city's municipal boundaries. The Enterprise Section's judgment provoked many reactions from both politicians and lawyers, with all sides calling for the imposition of further limitations on civil service works councils.

Commentary

There is much to be said for equal treatment of the civil service and the market sector in the area of terms and conditions of employment. Standardisation of industrial relations has already been more or less achieved in a number of areas. For example, the collective right to strike is regulated for both the market sector and the civil service on the basis of article 6, paragraph 4 of theCouncil of Europe's European Social Charter (NL9804170F), although some limitations do apply to certain civil servants.

Standardisation in the area of employee participation and terms and conditions of employment is off to a fitful start, which comes as no surprise in the latter case. A phased approach was chosen on purpose, and was indeed preceded by pilot schemes in certain sectors. Additionally, budget restrictions are sure to contribute towards disrupting negotiations in the long run.

Following extension of the WOR to the civil service, standardisation with respect to employee participation seems to have been introduced without too many hitches. Why then was such a fuss made over the various works councils' legal victories? Rather than ascribing the blame to works councils aiming to sabotage political decision-making, a possible explanation could be civil service managers' inexperience with the new regulations on employee participation. The Enterprise Section of the Amsterdam Court treats the civil service in the same way as the market sector: if employers exercise due care in terms of informing and consulting during the decision-making process, they are free to implement their policies in both sectors. Works councils may delay or interfere with decision-making only in cases where their rights are ignored (NL9810102F). (Robbert van het Kaar, HSI)