Tripartite agreement follows turbulent autumn

During autumn 2004, Dutch trade unions organised strikes and demonstrations in protest at the government's reform plans in various areas, including early retirement, unemployment benefit, disability insurance and the extension of collective agreements. In November, a 'social agreement' was signed by the government, unions and employers, which moderates some of the reform plans.

Consultations between the government and the social partners in May-June 2004 came unstuck (NL0407101N) on the issue of early retirement and a proposed 'life-span leave' scheme (levensloopregeling) enabling workers greater scope to save and manage periods of time off over their careers (NL0304103F). Subsequently, the trade union movement announced its intention to engage in industrial action in the course of autumn in a bid to underscore its demands (NL0409102N and NL0410101N). A large-scale union demonstration against the government's policy was held in Amsterdam on 2 October 2004 - attended by 300,000 people - followed by rotating strikes in different sectors. In the meantime, however, talks between the government and the social partners were resumed, which led to the conclusion of a 'social agreement' during the night of 5-6 November 2004. Both the government and the social partners see the achievement of an agreement as at least as important as its content.

Both the protests and negotiations hinged on the government’s plans in the areas of:

• early retirement and life-span leave arrangements (NL0409105F);

• economising on expenditure related to the Unemployment Insurance Act (Werkloosheidswet, WW), especially by scrapping short-term unemployment benefits (ie based on a relatively short recent contribution history) and deducting all or part of the compensation awarded to dismissed employees from their subsequent unemployment benefits (NL0410103F);

• amending the Occupational Disability Insurance Act (Wet Arbeidsongeschiktheid, WAO) (NL0404101N), especially by tightening disability criteria; and

• no longer extending to non-signatory employers the provisions of collective agreements with respect to wage increases (NL0408104F).

After the union demonstration in Amsterdam on 2 October, the Dutch Trade Union Federation (Federatie Nederlandse Vakbeweging, FNV), the Christian Trade Union Federation (Christelijk Nederlands Vakverbond, CNV) and the Federation of Managerial and Professional Staff Unions (Vakcentrale voor Middengroepen en Hoger Personeel, MHP) announced rotating strikes in October and November 2004 in all sectors. On 27 October, following a widespread strike at Dutch Railways (Nederlandse Spoorwegen, NS), the metalworking industry witnessed one of the biggest strikes in the sector in 15 years - 22,000 employees came out in strike at 200 companies, with firms such Nedcar and Corus virtually brought to a standstill. Along with individual employers, the Contact Group for Metalworking Industry Employers of the Federation of Metal and Electrical Engineering Industry (Federatie voor de Metaal- en Electrotechnische Industrie - Contactgroep van Werkgevers in de Metaalnijverheid, FME-CWM) was enraged about the fact that strikes took place in its sector, because metalworking employers themselves are critical of the government’s policy and have developed a modern (early) retirement scheme.

Further actions were planned later in November in the processing industry, the construction industry, the education and healthcare sectors, and the civil service. Finally, a nationwide demonstration was scheduled for 29 November. Following the social agreement reached in early November, it is expected that these actions will be cancelled, and some unions have already done so.

During the period of industrial action, negotiations between the government and the social partners were resumed, initially by way of preliminary talks, followed by informal talks between the government and the trade unions, given the specific differences between them, led by Prime Minister Jan-Peter Balkenende. At a later stage, the government talked separately with the employers, after complaints by the Dutch Federation of Small and Medium-Sized Enterprises (Midden en Kleinbedrijf Nederland, MKB) that one-sided negotiations between unions and government might result in employers beign presented with an already formulated agreement. Only at a very late stage were the talks were given the formal character of negotiations between the three parties. These finally led to the social agreement of 6 November 2004.

Although the government claims that the core of its reform plans still remains under the terms of the social agreement, important adjustments have been made as to soften the effect. Notably (fuller details will be given in a forthcoming EIRO article):

• the life-span leave arrangements have been broadened and made fiscally more attractive;

• changes to the Unemployment Insurance Act have been postponed until after the tripartite Social Economic Council (Sociaal-Economische Raad, SER) has advised on the issue.;

• the government will basically follow a recent SER opinion with respect to amending the WAO scheme. Disability criteria will be relaxed; and

• the extension of collective agreements with respect to their provisions concerning wage increases will be maintained.

Although the employers’ organisations had some difficulties giving their unqualified assent to the agreement, all parties are content with the fact that an agreement has been reached: employers for having restored peace in industrial relations and reduced labour costs; the government for having (re)gained some public support for its social reform policies; and the unions for the perceived success of their mass demonstrations and strikes.