Comparative overview of industrial relations in Europe in 2003

In the Netherlands, debate centred in 2003 on the rise of trade union organisations that act independently of the three established federations. The established unions have questioned the respresentativeness of these new organisations and the legitimacy of the agreements they have signed with some individual employers and smaller sectoral associations. Nevertheless, the established unions are still involved in the negotiation of more than 95% of all collective agreements (NL0302103F and NL0307101N). There was also some inter-union discord in Ireland, where a membership transfer dispute broke out between the country’s largest union, the Services Industrial Professional and Technical Union (SIPTU), and the UK-based Graphical, Paper and Media Union (GPMU) (a truce was eventually called - IE0305202N). Demarcation disputes between affiliates of the Austrian Trade Union Federation (Österreichischer Gewerkschaftsbund, ÖGB) were also reported during the year (AT0307203F). In Denmark, in November 2003 all but one of the health workers' trade unions belonging to the Health Cartel (Sundhedskartellet) announced that they are to leave the Association of Local Government Employees' Organisations (Kommunale Tjenestemænd og Overenskomstansatte, KTO), the umbrella body which represents employees in the Danish municipal and county sector in collective bargaining. This will remove nearly 100,000 workers, notably including nurses, from KTO's membership.

In terms of the political direction of trade unions, in Italy, cooperation between the three main confederations was somewhat strained on certain issues during 2003, though there were signs of a wish to re-establish unity late in the year (IT0312103F). In the UK, the election during 2003 of left-wing candidates as the new general secretaries of two influential trade unions was seen as likely to place further strains on government-union relations (UK0306105N).

On the employer side, 2003 was a rather quieter year. Perhaps the most significant event came in September, when Finland's two main employers' confederations - the Confederation of Finnish Industry and Employers (Teollisuuden ja Työnantajain Keskusliitto, TT) and the Employers’ Confederation of Service Industries (Palvelutyönantajat, PT) - announced that were studying the possibility of merging (FI0310201N). The merger was subsequently agreed in February 2004 and will create a new body, Finnish Industries (Elinkeinoelämän keskusliitto, EK), representing at least 15,000 companies that together account for over 70% of Finland’s GNP (FI0403201N). In Sweden, the two main employers' organisations in the municipality and city council sector - the Swedish Association of Local Authorities (Svenska Kommunförbundet) and the Federation of Swedish County Councils (Landstingsförbundet) - decided in May to merge by 2007. In Portugal, 2003 saw the merger of two employers associations in the textiles and clothing sector. The joint collective bargaining association for German public sector employers collapsed in May after more than 40 years. Representatives of the central government and the federal states (Länder) declared that they no longer saw common ground for a bargaining association with the municipal employers. Furthermore, the federal states are no longer willing to accept the leadership of the central government in future public sector bargaining rounds (DE0306202N). The year saw the formation of a new employers' organisation for suppliers in Luxembourg's fast-expanding automotive sector (LU0308102N) and various comings and goings in the membership of the Belgian Federation of Employers (Fédération des Entreprises de Belgique/Verbond van Belgische Ondernemingen, FEB/VBO) and the Estonian Confederation of Industry and Employers (Eesti Tööstuse ja Tööandjate Keskliit, ETTK) (EE0310102F). In Austria, the Chamber of the Economy (Wirtschaftskammer) continued with internal reform, aiming to consolidate its budget in the light of a reduction of membership contributions of 30% by 2005.

2003 was a mixed year regarding the involvement of the social partners in the formulation of social and employment policy. In Austria, the government launched a wide-ranging pension reform in the spring without the involvement of the social partners, resulting in country-wide industrial action (see below under 'Industrial action'). In Germany, the tripartite national forum, the Alliance for Jobs (Bündnis für Arbeit), discontinued its work in February 2003 (DE0302104N) after trade unions withdrew their support following a conflict with employers over pay moderation. In Latvia, the social partners' participation in decision-making process reportedly weakened somewhat - for instance, they were not invited to discuss the proposed state budget project while it was being drawn up (though bipartite cooperation between employers' organisations and trade unions appears to have improved). By contrast, the social partners in France have been experiencing more involvement in the formulation of social and employment policy. Legislation proposed in 2003 will commit the government to prior consultation of the social partners on all social and economic policy proposals.

In many candidate countries, the role of the social partners in the formulation of social and employment policy, and of bipartite social dialogue, is still in its relative infancy, although developing rapidly in some cases. Major developments in 2003 included the creation of bipartite sectoral level social dialogue committees in Hungary, with assistance from the EU's PHARE programme (HU0212106F). PHARE also supported the development of bipartite sectoral social dialogue in Slovakia (SK0307101N). At national tripartite level, December saw the first plenary session of Bulgaria's new Economic and Social Council, an advisory body made up of representatives of employers' organisations, trade unions and non-governmental organisations, which is regarded as completing the social dialogue system in Bulgaria (BG0401202N). In Romania, the organisation and functioning of the tripartite Economic and Social Council (Consiliul Economic şi Social, CES), was strengthened (RO0401107F).

Industrial action

Some countries experienced a relatively high level of industrial action during 2003, while others enjoyed a comparatively quiet year, though no statistical data are yet available on overall trends in action during the year.

In a number of countries, trade unions organised national strikes and protests against government policies. Notably, May 2003 saw Austria's largest strike action in 50 years, as almost half a million workers protested against the conservative-populist government's proposals for public pensions reform (AT0305202F). Similarly, in France, much action was organised in the spring over the government's pensions reform (FR0306104F). On 24 October, Italy’s three main trade union organisations held a one-day general strike to protest against the government's 2004 state budget law and its proposals for reform of the pension system (IT0311102N). This had been preceded by a four-hour general strike organised on 21 February solely by the General Confederation of Italian Workers (Confederazione Generale Italiana del Lavoro, Cgil), in protest against the policies of the government and employers (IT0302103N). There was also similar action in some of the new Member States. On 26 September, the Confederation of Trade Unions of the Slovak Republic (Konfederácia odborových zvazov Slovenskej republiky, KOZ SR) called a one-hour nationwide strike which affected a number of sectors, one of a series of actions organised by unions in protest at government policy (SK0312102N). Autumn saw a series of protests in Bulgaria calling for changes in the government's economic and social policy (covering issues such as incomes, taxation and sick pay) organised by two main union confederations (BG0311201N). There was also 'political' action in some countries on matters not directly related to industrial relations and employment - in both Italy (IT0304102N) and Spain unions (ES0304203N) organised stoppages during the spring in protest against the war in Iraq.

In individual companies and sectors, restructuring and attendant job losses gave rise to a considerable amount of industrial action in many countries (notably in central and eastern Europe). For example, a number of industrial conflicts took place in Belgium, linked to job losses at Ford’s Genk plant (BE0311305F) and in the aeronautical sector (BE0307301N) and plant closure plans at the steel producer Arcelor (BE0302301N). In Greece, proposed legislation on further liberalisation of the electrical power market provoked protest strikes in June and July (GR0307101N). In Bulgaria workers held protests against the planned privatisation of the Bulgarian Telecommunication Company (BTC) (BG0402101N) and the Bulgartabac tobacco holding. In Romania, protests were staged in the automotive industry, tractor manufacturing, steel, chemicals and oil processing against the collective redundancies generated by restructuring and privatisation (RO0311102F and RO0311101N). In Poland too, 2003 was characterised by numerous strikes, protests and demonstrations organised by miners, steelworkers and public sector employees, mostly protesting against redundancies and restructuring (PL0311102N).

In Finland, trade unions organised a national day of protest on 12 December to express concerns about the large-scale redundancies that have been taking place in Finnish companies (FI0312203F)

A notable feature of 2003 was the high level of industrial action on the railways, usually prompted by restructuring (sometimes related to EU liberalisation measures), but also by issues such as safety and bargaining arrangements. Thus, there were rail strikes and protests in countries such as Austria (AT0312103F), Belgium (BE0311301N), France (FR0304106F) Poland, Romania (RO0309101N), Sweden (SE0311102N) and the UK (UK0304103F). Two rail sector conflicts in Slovakia were the countries first genuine strikes since it became independent (SK0306101F). On 14 March, actions were held in many European countries as part of the International Transport Workers’ Federation's fourth annual international railway workers’ action day, entitled 'Safety first'. The aim of the protest was to draw attention to railway workers’ fears that the deregulation of railways around the world is jeopardising the lives of passengers and rail workers (EU0304202N).

Another international trade union campaign that produced national industrial action during the year was against a proposed EU Directive on market access to port services (EU0302201N), which trade unions feared would endanger employment for dock workers and lower health and safety standards. On several occasions during the year, Europe-wide protests against the proposed Directive - organised by the International Transport Workers' Federation (ITF), European Transport Workers' Federation (ETF) and International Dockworkers Council (IDC) - resulted in stoppages and strikes in a number of countries, notably Greece (GR0310101N) and Cyprus (CY0311101N). The Directive was eventually rejected by the European Parliament in November (EU0312203N).

The public sector often experiences comparatively high levels of industrial action and this was the case in a number of countries in 2003. In Greece, there was a wave of strikes in support of demands for pay indexation, the creation of new pay scales for public servants and over the issue of part-time work (GR0309103F and GR0311103F), culminating in November when the Greek Confederation of Public Servants (ADEDY) held a 24-hour strike (GR0312101N). In Estonia, a one-day strike was held by the Estonian Employees’ Unions’ Confederation (Eesti Teenistujate Ametiliitude Keskorganisatsioon, TALO) in support of pay demands for education and culture workers - the first genuine strike since Estonia gained its independence (EE0312103F). In Hungary, 2003 saw hardly any industrial action in the private sector, but some by workers in the public utility companies and other public sector workers, such as those employed in health and education (HU0306102N and HU0310101N). A dispute over a new pay agreement for 420,000 blue-collar workers in the Swedish municipal and city council sector resulted in five weeks of industrial action before a deal could be struck (SE0306103F). In May, workers in many parts of the Italian public sector went on strike to push for the opening of negotiations over the renewal of their collective agreements (which expired at the end of 2001) and support their demands (IT0306102N). Other public sector strikes in 2003 included action by: French education staff (FR0306102F) and refuse collectors (FR0307106F); Irish public health doctors (IE0307201N); Belgian postal workers (BE0308303F); and UK fire service workers (UK0307101N).

Strikes and industrial action and strikes were held within the context of collective bargaining in some countries, though overall it appears that the year's bargaining rounds passed off relatively quietly in most countries. Notably, in Germany, IG Metall's attempts to conclude an agreement on a 35-hour week in the eastern metalworking industry resulted in four weeks of strike action, but ended in failure (see above under 'Working time'). Other examples of conflict over new agreements included action by Swedish electricians (SE0308101N) and Italian transport workers (IT0312204F). More unusually, in Italy the Fiom-Cgil trade union campaigned during the second half of the year for the reopening of negotiations on the metalworking sector's collective agreement, which was signed in May 2003 by employers and the other two main metalworkers' unions, Fim-Cisl and Uilm-Uil. The campaign included an eight-hour strike in November (IT0312102N).

Despite the various high-profile examples of industrial action mentioned above, it should be stressed that some countries saw little in the way of conflict during 2003. Industrial action remained at historically low levels in Ireland, while other countries that experienced a quiet year included Latvia, Malta, Norway, Slovenia and Spain ( where the incidence of industrial action was significantly below that in 2002).

In terms of the regulation of industrial action, 2003 saw the establishment of the National Institute for Reconciliation and Arbitration, Bulgaria's first institution for the out-of-court resolution of collective labour disputes. The new Institute provides mediation and arbitration, and is seen as filling a major gap in the country's industrial relations system (BG0401103F). In September, Italy’s Guarantee Authority (Commissione di garanzia) on strikes in essential public services set out rules to be observed by public sector workers in the event of a general strike called by trade union confederations. The rules cover matters such as the provision of minimum services and were drawn up with trade union input (IT0310101N).

Employee participation

Employee participation and involvement remained a topic of great interest around Europe, not least because of the requirement to implement EU legislation.

At the beginning of 2002, EU Directive 2002/14/EC on national information and consultation rules was adopted (EU0204207F), obliging Member States to ensure that there are arrangements in place for informing and consulting employees on a range of issues. The Directive should be implemented at national level by 23 March 2005, but transitional arrangements for Member States without established statutory systems of employee consultation and representation - effectively Ireland and the UK - mean that these countries may phase in the coverage of the Directive for smaller firms. The implementation of the Directive has unsurprisingly had the highest profile in the two countries where it will have the largest impact: in the UK, the government published a consultative draft of Regulations to implement the Directive in July 2003(UK0307106F); while in August 2003, the Irish government published a consultation paper on national implementation (IE0309204F). Preparatory work on the implementation of the Directive has also begun in many other countries, where less extensive changes are generally regarded as being necessary for compliance. In Sweden, for example, a government committee was set up in October 2003 to investigate whether existing national law will need to be modified, and will report in July 2004. In Belgium, the social partners began discussions on the Directive in December.

The acceding candidate countries have been busy transposing various pieces of EU legislation relating to employee involvement and participation. For example, Hungary transposed the 1994 European Works Councils (EWCs) Directive (94/45/EC) in 2003 by means of Act XXI, which will enter into force on 1 May 2004. Malta also enacted legislation transposing the EWCs Directive, due to come into force on 5 April 2004. It appears that almost all new Member States joining the EU in May 2004 now have their EWCs legislation in place. A possible revision of the EWCs Directive itself remains on the European Commission's agenda and a first-stage consultation of the social partners is envisaged for early 2004, with a follow-up consultation later in the year. In the UK, the government published in July 2003 a discussion paper on the UK experience of EWCs, with the aim of gathering information and views to help it prepare for the forthcoming EU-level discussions on the possibility of revising the Directive (UK0308102N). The Confederation of British Industry (CBI) and the Trades Union Congress (TUC) submitted sharply divergent responses (UK0311101N).

Some countries began to take action over implementation (due by October 2004) of Regulation (EC) No. 2157/2001 on the European Company Statute (ECS) and its accompanying Directive (2001/86/EC) on employee involvement (EU0206202F). For example, in the Netherlands, a bill on employee involvement in the European Company was introduced in 2003. In Slovakia, the government is reported to be working on transposition. In Spain, a decision was taken in 2002 to create sectoral observatories and a national observatory to monitor the situation in the framework of the Statute. Some preliminary discussions are reported to be taking place in chemicals companies. In Sweden, a government commission set up to prepare for the implementation of the ECS reported its findings in June 2003 (SE0308102F), proposing that a new law should be passed to this end. In October, the UK government issued draft Regulations to implement the Directive and to deal with certain company law aspects of the ECS. In Norway, a committee deliberating changes to the country’s working environment legislation also looked at the implementation of the ECS (plus Directive 2002/14/EC) (it reported in February 2004). In Denmark, the government plans to implement the Statute in 2004.

Away from the direct implementation of EU law, developments in 2003 relating to employee involvement included the following:

• in Finland, a working group started preparing changes to the Law on Cooperation within Undertakings - the main item of workplace employee involvement legislation (FI0309203T) - and was due to make its final proposal in early 2004. A tripartite committee also began work on the reform, which is the largest labour legislation project of the current government's term of office. The Act has been widely criticised for being administratively complicated and unclear;

• in Italy, the 2004 budget law, approved in September 2003, provides for the creation of a special fund to encourage employee participation in companies' financial results and decision-making (IT0310102N). Furthermore, the new collective agreement in the rail sector (see above under 'Collective bargaining') establishes a 'participatory' industrial relations system for the sector, based on joint committees and information and consultation procedures at both national and company level;

• in Romania, the new Labour Code which came into force in 2003 explicitly recognised employees' information and consultation rights at company level, as well as their right to take part in establishing and improving working conditions and the work environment. In companies with more than 20 employees in which no trade union is organised, elected employee representatives can now promote employees’ interests. Employees must be periodically informed about the economic and financial situation of the company, and consulted whenever decisions that will substantially influence their interests are to be taken (eg in case of redundancies); and

• Slovakia's new Labour Code, which came into force in April 2002, made significant changes to the law on employee participation, which had previously granted consultation, information, inspection and collective bargaining rights only to trade union organisations. The new Code allowed for employee representation through an elected works council or 'works trustee' with negotiation, information and inspection rights, but only in organisations with no trade union presence. However, in July 2003, an amendment to the Code extended works councils and works trustees to organisations where a trade union is present (SK0308102F).

2003 was a quiet year in terms of reported new developments in the field of transnational employee involvement arrangements in multinational companies. One of the few new EWCs reported in major companies during the year was at the German mail and logistics multinational, Deutsche Post AG (DE0309204F).

Stress at work

Stress at work (TN0111109S) is an issue which has been receiving increasing attention at European level. Notably, in 2002 the European Agency for Safety and Health at Work organised a campaign, Working on stress, aimed at raising awareness of the problem of stress throughout the EU and helping all those involved in this issue across Europe to work together (EU0208202N), and stress was the central issue in the October 2002 European Week for Safety and Health at Work. The Agency estimates that stress at work affects around 28% of the EU workforce, amounting to over 40 million employees. Although women report the highest levels of stress, it is perceived to be a problem for both sexes, in all sectors and at all organisational levels. Stress is thought to cause cardiovascular diseases, musculoskeletal disorders and mental health problems, and is estimated to be related to up to 60% of all absence from work. In this context, following a seminar held in February 2003, the European-level cross-industry social partners called on their member organisations to grant them a mandate to begin negotiations with a view to concluding a voluntary agreement on stress at work. Negotiations began in September 2003 and had not concluded at the end of the year.

At national level, the debate is gaining momentum in many countries, with governments and the social partners recognising that stress at work is growing for many employees and, if not controlled, can lead to increases in sickness absence, low morale and poor performance. However, stress is not yet widely debated in all countries and does not appear to be high on the agenda at present in cases such as Cyprus, Greece, Hungary and Malta.

One of the countries which has been most concerned with the issue of stress at work over the past few years is Sweden, which has seen numerous official commissions, conferences, seminars, tripartite talks, research reports, government declarations and legislative measures on ill-health at work, with stress a key theme. Most recently, in December 2003 the government issued a declaration of intent on 'a more healthy working life' (SE0401105F), which among other points calls on the social partners to conclude new collective agreements on the work environment and take ill-health issues into account in future bargaining (see below). The debate is very much linked to attempts to reduce continuing high sickness absence rates in Sweden.

Action on stress involving both the government/public authorities and the social partners is reported from a number of other countries. A prime example is found in Germany, where issues of 'quality' of work in general and of stress and safety in particular are dealt with by the Initiative for the Improvement of the Quality of Work (Initiative Neue Qualität der Arbeit, INQA) - a broad platform (founded in 2001) which brings together the federal government, federal state (Länder) governments, the social security administration, the social partners and a number of companies in order to contribute to debate on the future of work. Through INQA, the parties seek to develop and disseminate examples of best practice and thus to contribute to the modernisation of work. In Norway, the Labour Inspectorate, in cooperation with social partners, has developed a guide to stress and a checklist to be used by employers in identifying and dealing with the problem. In Bulgaria, a first national conference on stress was held in September 2003, focusing on the reasons for stress, its consequences and its prevention. In Romania, there have been discussions involving the social partners about a modification of the labour inspection legislation, including the recognition of stress as an occupational disease.

Bipartite joint trade union-employer action on stress does not yet appear to be common in most countries, however there are some recent examples:

• in 1999, Belgium's bipartite National Labour Council (Conseil National du Travail/National Arbeidsraad, CNT/NAR), bringing together representatives of trade unions and employers' organisations, approved an intersectoral collective agreement on combating stress at work (BE9904269F). The agreement provides a definition of stress and sets out the obligations on private sector employers with regard to the prevention and the reduction of work-related stress. No information is available on the subsequent follow-up to this agreement;

• in the Netherlands, unions and employers both recognise the problem and a number of collective agreements contain provisions on conducting research into stress at work, while the matter is addressed in health and safety agreements and the social partners are currently trying to stimulate the development of instruments to combat stress;

• in Spain, several company agreements signed in 2003 (eg at Telefónica and several banks) provided for the creation of committees to examine the issue;

• in Slovenia, the sectoral agreement for postal and courier activities, concluded in 2003, imposes a duty on employers to adapt work to the individual worker by eliminating monotonous work and imposed work rhythms etc;

• in Sweden, the government is encouraging the social partners to negotiate on the work environment, including stress. Interestingly, in 2003, negotiations over a new collective agreement for electricians were complicated by demands from the Swedish Electricians' Union (Elektrikerförbundet) for improved working conditions, with the union claiming that its members working in the building sector were suffering excessive stress. The employers would not concede on this point and the union started industrial action. However, the LO union confederation intervened, stating that the stress issue should be taken up at a higher and more general level, and thus excluded for the time being from the electrician's bargaining agenda. This enabled a new agreement to be concluded (SE0308101N). Against this background, in January 2004, the LO board decided that all its affiliated (blue-collar) trade unions should make a uniform set of work environment demands to their respective employers' associations in the 2004 bargaining round (SE0402101N); and

• legislative amendments in 2003 seem likely to promote bargaining on stress issues in Denmark (where the topic already features highly in the work of joint workplace cooperation committees). Changes to the law leave a number of 'psycho-social' aspects of the work environment, including stress, to be jointly regulated by collective agreements between the social partners.

Unilateral trade union activities and demands on stress seem to be becoming more common. In the UK, a recent TUC survey of union safety representatives identified stress as the country’s 'number one workplace health hazard', and in April 2003, the TUC reported that unions had launched 2,500 new stress claims against employers in the previous year. The TUC has launched and promotes a 'stress MOT' auditing tool to assess the causes of stress and employer responses. The Austrian Chamber of Labour conducts annual surveys on the issue, and representatives of organised labour are calling for better (precautionary) health services to be offered at company level. In Germany, the IG Metall metalworkers' union decided in spring 2003 to launch a campaign called 'good work' (Gute Arbeit) which particularly aims at reducing stress at work, not least in order to improve the health and employment prospects of older workers and thus adjust the workplace to the process of the ageing of the workforce. IG Metall also hopes that a new framework collective agreement for the metalworking industry, signed in June 2003, will give it more power to reduce stress at work. The Luxembourg Confederation of Independent Trade Unions (Onofhängege Gewerkschafts-Bond Lëtzebuerg, OGB-L) and the Luxembourg Mental Health League (Ligue luxembourgeoise d’hygiène mentale) concluded a partnership agreement in September 2002 on setting up a national scheme to assist workers who suffer from stress-related illnesses, a move which received a favourable response from the government. This 'work-related stress information unit' currently operates a telephone helpline, provides individualised counselling, and organises relaxation activities. In Romania, the Cartel Alfa confederation is conducting a study of the topic and some unions have organised special seminars. The Spanish union confederations' health and safety institutes are calling for workplace health and safety committees to address the problem and apply pressure for it to be dealt with in collective bargaining. The health and safety institute of the Trade Union Confederation of Workers’ Commissions (Comisiones Obreras, CC.OO) is developing a methodology to evaluate psycho-social risks.

Action on stress by the government and public authorities responsible for health and safety at work has featured recently in some countries, notably in central and eastern Europe. Estonia's occupational health development plan for the period until 2007 highlights the issue and states that measures to tackle stress and 'psycho-emotional' stress factors at work will be developed in 2004. Poland's Central Institute for Labour Protection (Centralny Instytut Ochrony Pracy, CIOP) is conducting research on stress at work. In 2003, Slovakia's Research and Education Institute on Health and Safety at Work (Výskumný a vzdelávací ústav bezpecnosti práce, VVUBP) issued a publication on training on stress at work, including basic information, a description of stress factors and options for their elimination, while the theme features in National Labour Inspectorate (Národný inspektorát práce, NIP) activities. A resolution (previously discussed with the social partners) on the National Programme on Safety and Health at Work adopted by the Slovenian government in September 2003 contained a section on stress and provides for work in this area. In the current EU, during 2003 the UK Health and Safety Executive (HSE) piloted draft management standards of good practice for tackling work-related stress, and launched a new report identifying a good practice model for tackling stress, based on the experience of 18 organisations seen as 'beacons of excellence' in stress prevention The HSE produced a draft code of practice on stress in 1999, but it remains unadopted.

In terms of relevant new legislation in 2003, the main example was the Finland's Occupational Safety Act, which includes several measures aimed at decreasing stress at work - for instance, a risk analysis on stress and other mental factors causing health problems must be conducted at all workplaces. It is notable that the experience of Finland in this area is in contrast to that of most other countries - here, stress at work appears to be decreasing. According to a survey carried out by the Finnish Institute for Occupational Health and Safety, work-related stress has decreased, especially among men. The proportion of men stating that they feel stress at work sometimes or very often has declined from 49% in 1997 to 43% in 2000 and 38% in 2003, though women tend to suffer stress more often than men.

Undeclared work

The phenomenon of undeclared work - defined as 'any paid activities that are lawful as regards their nature but not declared to the public authorities'- is an issue which has been preoccupying the EU institutions for a number of years. Studies estimate the size of the informal economy on average at between 7% and 16% of the EU's GDP. The current EU employment guidelines call on the Member States to transform undeclared work into regular employment, by developing and implementing broad actions and measures to eliminate such work, which combine simplification of the business environment, removing disincentives and providing appropriate incentives in the tax and benefits system, improved law enforcement and the application of sanctions. In October 2003, the Council of the European Union adopted a Resolution on undeclared work (EU0311206F), calling on Member States to address this issue and to work together to improve the situation. Suggested actions include preventative measures and sanctions aimed at eliminating undeclared work. The Resolution also invites the social partners at European level to address this issue within the context of their current multiannual work programme (EU0212206F) - indeed, the partners plan a seminar on the issue in 2005, with the aim of reaching a joint opinion - and to deal with it in the context of the sectoral social dialogue committees. The Council calls on the social partners at national level to promote the declaration of economic activity, to engage in awareness-raising and to promote the simplification of the business environment, particularly in relation to small and medium-sized enterprises..

Data, and especially reliable data, are hard to find on the extent of undeclared work, but the information available is give in table 4 below. In the current EU, the phenomenon appears to be particularly prevalent in Greece and Italy, significant in Austria, France and Spain, and less common in Finland, Luxembourg, Sweden and the UK. Most of the acceding and candidate countries in central and eastern Europe seem to have a relatively major problem with undeclared work. Construction, hotels/restaurants/catering, agriculture, domestic/personal services and retail seem to be the sectors most affected across Europe. In some countries, it is thought that a relatively high proportion of undeclared work is carried out by (often illegal) immigrants from outside the current EU.

Looking at the current situation around Europe, we find that the degree of attention to undeclared work varies considerably. In some countries (such as Ireland and Luxembourg), it is not apparently perceived to be a particularly significant problem, whereas in others it is a major focus of debate. The issue seems high on the agenda at present in countries such as Austria, Belgium, Denmark, Germany, Greece and Italy, as well as in many of the acceding and candidate countries in central and eastern Europe. For example, in Austria, recent scandals involving illegal employment practices in road haulage (AT0203201N) and in the construction industry (AT0302202F) have triggered a continuing debate on measures to combat illicit work. In particular, cases of large-scale, organised social security and tax fraud committed by a growing number of companies have led trade unions and the parliamentary opposition to call for legislation combating these practices. In most countries concerned, there appears to be a general acceptance by the government and the social partners that undeclared work cuts social security and tax receipts, destroys regular jobs, enables unfair competition and deprives workers of proper protection.

In terms of government action to combat undeclared work, there has been considerable activity of late in acceding and candidate countries such as Bulgaria, Latvia, Slovakia and Slovenia. For example, in 2003, the Bulgarian government, supported by the social partners, introduced new measures to address two major labour market problems related to undeclared work (BG0307101F): employment without a signed contract; and the practice of employers paying social insurance contributions on the basis of the national minimum wage, rather than on employees' actual pay. Thus, registration of employment contracts with the National Social Security Institute has been made mandatory, while minimum social insurance thresholds have been introduced, which are higher than the national minimum wage and set at different levels for specific sectors and occupations. In Slovakia, the Employment Act was amended in 2003 in an attempt to clamp down on undeclared work. In Malta, a committee made up of representatives of the Employment and Training Corporation (ETC), the Ministry of Social Policy, the Ministry of Finance and Economic Services and the Ministry of Education was set up in August 2003 in order to draw up and plan a national campaign against undeclared work.

As in Bulgaria, the issue of proper employment contracts is prominent in some other acceding and candidate countries. In late 2003, the Estonian Ministry of Social Affairs launched an advertising campaign, aimed at employers, to promote 'official' written employment contracts. In Hungary, the law was amended in 2003 in an attempt to reduce the large number of people performing work on the basis of 'sham' civil law contracts - ie contracts not governed by labour law, with a lower tax and social security burden (HU0310102F).

In the current EU, the German government regards the present extent of undeclared work as alarming (pointing in particular to the loss of tax income for the state) and has therefore recently prepared a draft bill to introduce tighter controls and more severe sanctions. In Italy, the poor results of previous attempts to control undeclared work have induced the Ministry of Labour and Social Policies to propose the establishment of an extraordinary commission endowed with broad powers, including coordination of the police forces, in order to combat the problem.

Recent government action in this area has in some cases been prompted by the focus on undeclared work in the European employment strategy, and included in National Action Plans (NAPs) for employment - examples include Greece, Malta, Slovenia and the UK. In a number of present EU Member States, such as Denmark, the introduction of transitional measures for the free movement of workers from the new EU Member States has included attempts to prevent undeclared work by migrants from these countries.

In some countries, efforts are being made to address the undeclared work problem through building partnerships between public authorities and employers and trade unions in the sectors and areas most affected. This has been the case, for example, in construction and cleaning in Belgium. The Danish government has made the fight against undeclared work a priority and in summer 2003 decided to strengthen measures in this area. Regional networks have been developed, involving the local branches of trade unions playing a major role in detecting illegal workers and employers’ organisations helping to identify those firms employing workers illegally (DK0308101N). In France, there is an increasing number of partnerships and collective agreements specific to particular sectors and regions aimed at combating the problem. The issue of 'substandard' employment and business practices was prominent in Norway in 2003, particularly in the building and construction sector. In recognition of the detrimental effects of such practices, the social partners in the industry, along with relevant regulatory and enforcement bodies, have joined forces to establish a working group to examine and recommend measures to deal with the problem, which published its first report in November 2003 (NO0312103F). There has also been joint work at national level in some countries. For example, in November 2003, representatives of Estonian trade unions and employers’ organisations, together with the Labour Inspectorate and the Tax Board, held a round-table meeting to discuss the widespread problem of undeclared wages, on which social security contributions and income tax are not levied. The participants called for stronger control of the implementation of relevant laws and regulations (EE0312101N). The UK government has set up an Illegal Working Steering Group, which includes representatives of the CBI and TUC.

The causes of undeclared work, and how to address it, are not always an issue of unanimous agreement among the social partners. In a number of acceding and candidate countries, such as Hungary and Romania, the social partners seem agreed that it is the high level of taxation and social contributions levied on wages that drives both employers and employees to use undeclared work. In Romania, both trade unions and employers’ organisations claim that lowering the tax burden is the most important means of transforming undeclared work into regular employment. The tax and social security burden is also highlighted by employers in a number of other countries, such as Austria, Belgium, Germany and Malta, with consequent demands to lighten this burden. Other causes cited by employers include overly rigid labour market regulations (as in the case of Germany), and other solutions offered include simplifying the relevant administrative rules. By contrast, trade unions in many cases (eg Austria, Belgium, Germany and Italy) see tightening up legislation and controls, and making sanctions more substantial, as the best way of tackling undeclared work. More information for workers about the consequences for them of performing undeclared work is also demanded by unions in countries such as Slovenia. Italy's Cgil trade union confederation has submitted a proposal which envisages: the creation of a national fund to support local 'emergence' plans for undeclared workers; the expansion of inspection services; more stringent rules for contract procurement, subcontracting and the agricultural sector; and an inclusive strategy for immigration.

Table 4. Data on the extent of undeclared work and the informal economy

Austria	The growing informal economy is estimated to represent about 10% of GDP. According to a 2001 study, most illicit employment relationships are found in the construction industry (38% of the total), followed by hotels and restaurants (17%) and industrial production (16%).
Denmark	A September 2002 survey conducted by the trade union cartel in the building and construction sector (Bygge-, Anlægs- og Trækartellet, BAT-kartellet) found that around 6,500 people were working illegally in building and construction, agriculture, forestry and gardening (87% of the illegal workers came from Poland, Lithuania and Latvia). Undeclared work is also thought to be relatively common in cleaning, restaurants and hotels.
Estonia	According to the Estonian Institute of Economic Research (Eesti Konjunktuuriinstituut, EKI), in 2002 some 13% of employees received wages which were paid totally or partly without taxes.
Finland	Undeclared work is estimated to account for around 4.5% of GDP, and is mainly concentrated in the hotel and restaurant business, construction and private households. According to a 2002 study, the level of undeclared work in equals on average the annual work of 17,000-23,000 people (9%-16 % of sectoral production) in the construction sector, and of 18,000 people (21% of sectoral output) in restaurants.
France	Undeclared work is thought to account for 10%-20% of GDP. A 2003 official report on the subject found that it is a growing phenomenon and that is assuming increasingly subtle and varied forms (eg employment of undeclared workers, non-payment of contributions, incomplete declarations and disguised outsourcing).
Greece	Illegal employment and undeclared economic activity is thought to account for around 35% of GDP. The Social Insurance Foundation (IKA) states that around one worker in four is uninsured for social security. A significant part of the hidden economy is thought to involve undeclared work by migrants from eastern Europe and Asia.
Italy	A series of recent surveys, the most important of them conducted by the Istat official statistical body, have found that Italy’s 'hidden' or 'irregular' economy continues to grow (IT0312306F). According to the most recent figures, 3.5 million workers out of a total labour force of 23,452,000 are irregular. This is a figure equivalent to 15%, and the level rises to 18% among employees. The growth of undeclared or work is matched by that of the hidden economy, which oscillates between 15.2% and 16.9% of GDP. The sectors most affected by irregular work are domestic or personal care services, building, agriculture, catering, tourism and retail. The phenomenon is especially widespread in southern Italy, where one in every five workers is irregular.
Latvia	Undeclared work is thought to be at relatively high levels, often taking the form of undeclared cash payments for part of an employee's work. The existence of such work in agriculture, industry, construction, trade and hotels/ restaurants is indicated by the relatively low level of declared pay in the private sector (compared with the public sector) in these sectors
Poland	The number of people involved in undeclared work is estimated at 800,000 (total employment is around 13.8 million).
Romania	The underground economy’s share of GDP was 18% in July 2003, down from 20% in 2002 (according to OECD figures) and 30%-45% in 2001 (according to the United States Agency for International Development). Moreover, government officials estimated that in 2003 approximately 45% of the unemployed were working illegally. The Alliance for the Economic Development of Romania (ADER) estimated that in 2003 some 10%-17% of employers used undeclared work, accounting for 1.8 million-2 million people (total employment is around 8 million).
Slovakia	The number of people performing undeclared work has been estimated at between 70,000 and 140,000 (total employment is around 2.1 million). Such work is most common in construction, retail and travelling services.
Slovenia	The 'grey economy' is estimated at between 17% and 25% of GDP. Undeclared work is thought to be most common in crafts and related activities, catering and services.
Spain	The most recent detailed national study was in 1986, when between 15% and 20% of the active population was found to be in the underground economy. A 2000 EU study found that the underground economy in Spain represented 22% of the total. Undeclared work often involves: jobs in areas such as domestic service; undeclared overtime; and work by unregistered immigrants (especially in agriculture, construction and hotels/catering).
Sweden	A 2003 Danish study estimated that undelcared work amounted to 2.3% of GNP in Sweden. Students are the group of workers most involved, and the main sectors are restaurants, cleaning and construction.
UK	According to national statistics, undeclared income amounted to about GBP 14 billion in 1999, approximately 1.5% of GDP. There are no reliable estimates of the number of workers involved.

Source: EIRO.

New forms of work

'Non-standard' forms of work, such as temporary work through agencies, fixed-term contracts, part-time work and flexible forms of working, retained their place at the forefront of debate around Europe during 2003. Developments included new legislation, particularly in the acceding candidate countries, as they implement EU Directives before accession to the EU (see above under 'Legislative developments'), and new agreements at national, sectoral and company level.

Overall, according to Eurostat, the incidence of part-time working in the current EU increased between 2001 and 2002, from an average of 18.0% of all employment in 2001 to 18.2% in 2002 - see figure 6 below. The average in the 12 'euro-zone' countries also increased, from 16.2% in 2001 to 16.5% in 2002. The Netherlands stands out as the country with the highest level of part-time working - 43.8% in 2002. Other countries with a relatively high incidence of part-time working include Norway (26.3%), the UK (25.0%) and Sweden (21.4%). The incidence of part-time working was lowest in Greece, at 4.5%, followed by Portugal, at 11.3%. Part-time working appears to be a growing phenomenon in the majority of countries - its incidence rose between 2001 and 2002 except in Spain, Italy, Ireland, France and Denmark.

In the acceding and candidate countries, the incidence of part-time working is generally considerably lower than in the current EU, standing at 7.8% overall in 2002, down from 9.8% in 2001, though the level varies considerably between countries. The level of part-time work fell slightly from 2001 to 2002 in Bulgaria, Cyprus, the Czech Republic, Estonia, Latvia and Slovakia, though the major drop in Romania is largely due to a change in definitions. The country with the highest incidence of part-time working in 2002 was Romania, with 11.4%, followed by Poland (10.7%) and Lithuania (9.8%). The countries with the lowest incidence of part-time work were Slovakia (1.9%), Bulgaria (3.1%) and Hungary (3.6%).

There were relatively few legislative of bargaining developments related to part-time work in 2003. In Malta, the Part-Time Employees Regulations (2002) came into force in 2003, protecting part-time employees against discrimination on the basis of their employment contract. Slovenia's new Law on Labour Relations, which came in force in January 2003, set out new regulations on part-time work (as well as fixed-term employment, temporary agency work, home work etc) - these do not differ substantially in their content from the previous rules, but are now set out in a more clear and precise way (SI0308201F). Romania's new Labour Code sets a legal framework for all 'atypical' forms of work for the first time. In Norway, a committee was set up in November to look into the causes of part-time work, how its use affects participation and flexibility in the labour market and to examine the extent of involuntary part-time work and what can be done to reduce this. The committee will report in October 2004.

Figure 6. Part-time work in the EU Member States, Norway and candidate countries, 2001 and 2002 (% of the workforce)

* 2001 figure - population between 15 and 74; ** 2001 figure is for 2000; *** comparability with 2001 lacking due to changes in definitions of employment and unemployment.

Source: Eurostat labour force survey.

Turning to fixed-term work (work on a 'contract of limited duration'), the overall incidence declined slightly in the current EU between 2001 and 2002, according to Eurostat figures - see figure 7 below. The 2002 average for the EU 15 was 13.1% of all employment in 2002, compared with the 2001 average of 13.4%. The figure for the 12 euro-zone countries was 14.7% in 2002, compared with 15.0% in 2001. The level of fixed-term working varies considerably between Member States - the country with the highest incidence of fixed-term working is still (by some distance) Spain, with an average of 31.2% in 2002, although this is down from 31.6% in 2001. Other countries with a relatively high incidence of fixed-term working include Portugal (21.8% in 2002), Finland (17.3%) and Sweden (15.7%). Luxembourg, Ireland and the UK have the lowest incidences of fixed-term work, at 4.3%, 5.3% and 6.1%, respectively.

In the acceding and candidate countries, the average level of fixed-term work was 8.0% in 2001, rising to 11.1% in 2002, according to Eurostat. Fixed-term work is thus, on average, somewhat less common than in the current EU. The range in 2002 was from 15.5% in Poland and 14.7% in Slovenia to 0.9% in Romania and 2.2% in Estonia.

New legislation on fixed-term work, mainly implementing the 1999 EU Directive (1999/70/EC) on the subject, was adopted or came into force in 2003 in countries such as Cyprus, Greece, Hungary, Ireland, Malta and Slovenia. The Greek legislation proved controversial, and the year saw a number of court cases challenging the fact that many workers, mainly in the public sector, are excluded from some of its provisions (GR0306102N). In Norway, the government proposed a liberalisation of the rules governing temporary (fixed-term) work, which was strongly opposed by trade unions (NO0210103F). However, the government had to withdraw its controversial proposal in order to reach political agreement on the state budget in the autumn (NO0312101N). In France, new forms of fixed-term employment contract linked to the completion of a specific task were widely discussed in 2003, and seem likely to be the subject of legislation in 2004.

Figure 7. Fixed-term work in the EU Member States, Norway and candidate countries, 2001 and 2002 (% of the workforce)

* 2001 figure for population between 15 and 74; ** 2001 figure for population over 15; *** comparability with 2001 lacking due to changes in definitions of employment and unemployment.

Source: Eurostat.

On the specific issue of temporary agency work, there was a fair amount of legal and bargaining activity at national level in 2003, although the European Commission's proposal for an EU Directive to ensure the principle of non-discrimination for temporary (agency) workers failed to achieve adoption during the year (EU0306206F). In Germany, new legislation on temporary agency work came into effect at the beginning of the year, with the aim of promoting an expansion of this form of employment. In Poland too, new legislation was adopted on agency work, which has been growing in recent years. The new law defines temporary agency work and lays down rules on its use and on the employment conditions of agency workers (PL0308103N). New statutory rules in this area also came into force in Slovenia, seeking both to increase the flexibility of the labour market and provide adequate protection for agency workers (SI0207101F).

Germany's new legislation led in May 2003 to the conclusion by trade unions affiliated to the DGB confederation of separate packages of collective agreements with two major employers' associations in the temporary work sector. The agreements - the first multi-employer agreements in the agency work sector - cover pay, working time, paid leave and bonus payments (DE0308203F). Sectoral bargaining was already established for temporary agency work in a number of countries, and 2003 saw new agreements in countries such as:

• Austria - providing a minimum pay increase of 2.1%;

• Belgium - covering issues such as training, health and safety, bonuses and combating discrimination against agency workers when applying for bank loans;

• the Netherlands - increasing the maximum length of contracts and ensuring payment for agency workers on the basis of the user company's collective agreements (after 26 weeks' work); and

• Sweden ( blue-collar workers) - increasing the guaranteed minimum monthly wage and improving the position of newly recruited workers, as well as dealing with matters such as the geographical area within which workers can be expected to work and the use of fixed-term contracts (SE0303102F).

Temporary agency work continues to spread rapidly in many countries, including Denmark, Finland and Italy. This often raises the profile of this form of work among the social partners, and also raises new legal questions about the position of agency workers. For example, in Denmark trade unions formerly paid little specific attention to the question, but the increase in the use of agency work and the draft EU Directive on the issue have led them to formulate a policy on the issue, especially with regard to when agency workers should have the same rights as user company employees on open-ended contracts. This point was put to the test in 2003 in an arbitration case involving the Union of Danish Electricians (Dansk El-Forbund) and Tekniq, the employers' organisation for heating and plumbing engineering and electrical installation. In a landmark award, the arbitrator ruled in September that temporary agency workers should receive the same terms - including pay - as employees doing the same work in the user company to which they have been assigned (DK0309101N). Another significant ruling was issued in Italy. Here, the use of agency workers by firms is in many cases thought by trade unions to be in breach of the legislation on the issue, which permits such workers to be used only on specific grounds. In August 2003, a labour tribunal ordered the TIM mobile telephone company to reinstate a temporary agency worker on an open-ended contract at one of its call centres. The tribunal found that the company had failed to provide the justification required by law for the use of an agency worker. This was the first such judicial decision and may mark a turning point in preventing the unlawful use of this type of labour (IT0310308F).

Turning to telework, there was some activity among the national social partners on implementation of the European-level intersectoral social partners' July 2002 agreement on telework (EU0207204F). In August 2003, the UK government published guidance on telework agreed by the CBI, TUC and CEEP UK (UK0309102N) in response to the European agreement. The UK guidance is intended by the signatory parties to provide a useful checklist of issues to consider when implementing teleworking and explain how the text of the European agreement might best operate in the context of the UK labour market. Management and employee representatives can use this guide to draw up company-specific policies on teleworking. However, its precise status is the subject of differing interpretations - in their introductions to the document, the leaders of both the TUC and CEEP UK referred to it as an agreement, whereas the CBI's director general used the description voluntary, non-binding guidance. Similarly, in June 2003, the Swedish social partners agreed a set of joint guidelines on the national implementation of the European telework agreement (SE0309102N). In Spain, the national intersectoral framework agreement providing guidelines for bargaining in 2003 contains a section committing the social partners to implementing the EU telework agreement.

Otherwise, there was not very much change in the regulation of telework in 2003. New legislation on the employment conditions and status of civil servants in Luxembourg provides that they may now receive permission from their head of administration to do some of their work at home by teleworking and making use of information technology (LU0306102F). There was also a proposal to introduce experiments in part-time teleworking in the Belgian federal public administration. In Slovakia, labour legislation regulated work at home for the first time.

The 'new' forms of work examined above are not the whole picture, and other types of atypical work feature in many countries. To take the example of Italy, 'semi-subordinate work' (between dependent employment and self-employment) and 'employer-coordinated freelance work' are becoming increasingly widespread and have played a key role in employment growth in recent years. The most important of the non-dependent atypical forms of work is employer-coordinated freelance work, which is growing at an average rate of 12% per year, and now involves almost 2.4 million workers. This increase has been matched by a substantial growth, in both quantitative and qualitative terms, of collective bargaining covering such workers, which has led to important agreements being reached not only at the company and territorial level but also at the sectoral and national levels (IT0308304F). New rules on employer-coordinated freelance work featured in 2003's major labour market reform legislation (IT0307204F), which also introduced or regulated various new forms of employment contract, with the aim of increasing labour market participation - such as 'staff leasing' contracts, on-call work contracts, job-sharing and 'supplementary work'.

Outlook

2004 looks set to be a challenging year in terms of industrial relations, collective bargaining and pay. One of the most significant events of the year will be the enlargement of the EU from 15 to 25 Member States from 1 May 2004, the largest single expansion exercise in the history of the EU. This will entail significant adjustments on the part of the governments and social partners in the acceding countries.

In political terms, the Presidency of the EU Council is held by the Irish government during the first half of 2004 and by the Dutch government during the second half of the year. Elections to the European Parliament will be held in 2004 and a new European Commission will take office when the mandate of the current Commission finishes at the end of October. In individual Member States, general elections are to be held in Spain, Slovenia, Greece, Romania and Luxembourg. Regional elections will be held in France and major local elections in Finland, Malta, Romania and Portugal.

The labour market will remain one of the largest challenges for many countries during 2004. In existing Member States, the year will see borders open to workers from the new Member States, although transitional arrangements are in place in the majority of current Member States. Many countries, such as Germany and Italy, have undergone significant labour market reform in recent years. In Germany, 2004 will be a year in which the success of the reforms, particularly in the area of social security, will be monitored. In Italy, 2004 will see the implementation in companies of the legislative reforms passed in 2003. Employment creation will remain a major preoccupation of the Belgian government, while further labour market reform will be on the agenda in Greece.

Pension reform is another major focus for many countries, as governments and social partners grapple with the problem of an ageing population and falling birth-rate. Thus, Austria is likely to see further reforms to its pension system in 2004. In Italy, pension reform is set to dominate the industrial relations and social policy debate, with the government likely to press on with reform, in the face of trade union opposition. The reform of the pension and health system will also be a topic of debate in Malta in 2004. In Norway, discussions are likely on pensions issues such as the fate of the country’s early retirement scheme and occupational schemes. Pension and healthcare reforms have been partially implemented in Slovakia and their completion will be a subject of debate in 2004. Other aspects of social security are a topic of debate in some countries. For example, 2004 will see the continuation of discussions on sickness absence and sick pay in Sweden, on unemployment benefit in Austria, on social security financing in Finland, on unemployment benefit and sickness insurance in France, and on healthcare in Latvia

In terms of collective bargaining, there is likely to be considerable activity at national, intersectoral level in many countries. Current national agreements expire during the year, or shortly afterwards, in countries such as Belgium, Finland, Greece and Spain and 2004 is will see bargaining over potential new accords. The social partners in Ireland will be preoccupied with trying to negotiate follow-on national pay provisions to those set out in their 2003 national agreement, in the context of a relatively conflictual industrial relations climate. In Slovenia, there will be negotiations over a new tripartite agreement on pay policy, with the deindexation of pay the most controversial issue. Furthermore, practically all national agreements in the private sector (the intersectoral general agreement and individual sectoral accords) expire during the year and should thus be renegotiated.

In Denmark and Sweden, 2004 will see the renegotiation of the main sectoral collective agreements - with the pace set by the industry sector - as multi-year agreements signed in 2000 and 2001 expire. Norway too, will witness a major bargaining round, after 2003's intermediate settlement, and the negotiations are expected to be a test of the continuing viability of the cooperative incomes policy approach that has characterised wage formation for over a decade. Important sectoral agreements are also due for negotiation in Germany - notably the influential metalworking industry settlement, where working time flexibility is likely to be a major theme - Italy (where pay will probably be a central issue) and Slovenia. In Cyprus, a key question in the bargaining round at sector an company level will be whether unions will demand pay increases above and beyond the increase in competitiveness, aimed at gradually achieving real convergence with pay in the EU as a whole - an issue also expected to feature in Greece. The Maltese government is due to try to establish a 'social pact' with the social partners

New or proposed legislation on the rules for collective bargaining is likely to be a focus of debate in France, Slovenia (where new legislation should introduce 'free' collective bargaining proper) and Hungary (where a revision of the Labour Code is expected, making it easier to conclude sectoral agreements). Some unions in Cyprus will continue to call for collective agreements to be made legally binding. Important legislation is expected in 2004 on issues such as: strikes in essential services in Cyprus; gender equality in Estonia; 'mobilisation for employment' (including new forms of task-related employment contracts) in France; and public administration employment contracts in Portugal

The EU Directive on employee involvement in the European Company Statute must be implemented by October 2004, and the years should thus see considerable activity in this area. Similarly, the national information and consultation Directive must be transposed by March 2005, suggesting that new or amended legislation is in prospect in this area in many countries - this is particularly the case in the UK and Ireland, where significant changes to existing rules will be required. The new Member States will have to complete their transposition of the acquis communautaire in the industrial relations field by May. (Andrea Broughton, IRS)