Following a deadlock over the proposal to relax the country’s dismissal law, tripartite negotiations resumed when the issue was delegated to a special committee. In the latest round of talks, the social partners confirmed their commitment to finding solutions to the impending economic recession. Central issues included increasing labour market participation, incentives for extending the working life and calls for the postponement of an increase in value-added tax.
Context
The spring consultations between the Dutch cabinet and the social partners on socioeconomic plans for the forthcoming year marked the end of a period of tension between the trade unions and cabinet in 2008. Although supported by the employers, the plans put forward by the Minister of Social Affairs, Piet-Hein Donner, to relax the country’s dismissal law were rejected outright both by the trade unions and governing Labour Party (Partij van de Arbeid, PvdA) (NL0701039I). Fears of a potential cabinet collapse were even raised as a result. The issue was subsequently delegated to the Bakker Committee and the three sides resumed the search for a common ground (NL0807019I). During the spring consultations – in which the Confederation of Netherlands Industry and Employers (Vereniging van Nederlandse Ondernemingen-Nederlands Christelijk Werkgeversverbond, VNO-NCW) and the Dutch Federation of Small and Medium-Sized Enterprises (Midden- en Kleinbedrijf Nederland, MKB-Nederland) had initially refused to participate – relations between the parties were improved.
Bonus for working beyond retirement age
The Minister of Social Affairs entered the dialogue with hopes of extending the working life. Minister Donner proposed that older employees who continue to work after the age of 65 years would receive a bonus of 5% more than their benefits under the General Old-Age Pensions Act (Algemene Ouderdomswet, AOW) each year. While the state pension would then start later, it would be 15% higher for those who continue working until the age of 68 years.
The issue of extending the working life no longer appears to be a taboo subject for the trade unions. The social partners now jointly propose that older employees be awarded fewer days off and that those who continue working after the age of 65 years receive an additional 5% in AOW benefits each year.
Priorities of trade unions and employers
The most important demand expressed by the trade unions is, at the very least, the retention of spending power. In this respect, the cabinet has promised an annual increase of 1%. At the same time, together with the employers, the trade unions are calling for the postponement of the intended increase in value-added tax (VAT). Moreover, the employers want greater wage moderation. The respective parties highlighted their demands rather than alluding to any desire to reach an agreement at this stage; thus, the process was more an exercise in nurturing the regained spirit of mutual trust.
Efforts to stimulate Dutch economy
The cabinet and social partners – including VNO-NCW, MKB-Nederland and the Dutch Confederation for Agriculture and Horticulture (Land- en Tuinbouw Organisatie Nederland, LTO-Nederland) on the employer side, and the Dutch Trade Union Federation (Federatie Nederlandse Vakbeweging, FNV) and the Christian Trade Union Federation (Christelijk Nationaal Vakverbond, CNV) on the trade union side – have agreed to come together to find ways to keep the Dutch economy on track.
The discussions took place against the backdrop of a potential downturn in the Dutch economy and involved a great deal of agenda drafting. VNO-NCW questioned the issue of linking the policy aim of increasing labour market participation and postponing the VAT increase. This position was supported by MKB-Nederland, which claims that there has been virtually no growth in the number of jobs in small and medium-sized enterprises (SMEs). Moreover, if the government decides to go ahead with its VAT increase, it was argued that this could offset the cabinet’s goal of helping to find employment for 200,000 jobless people. To increase employment, it has been highlighted, the economy must flourish and consumer spending needs to increase. The proposal to postpone a VAT increase was supported by the trade unions, which claim that earnings have diminished in almost all income brackets. Greater spending power without higher wage demands will help to stimulate the economy.
Furthermore, the social partners proposed incentives for the extension of part-time work by raising the level of tax deduction for large-scale part-time jobs. The trade unions also asserted that cuts in childcare should not be made at the expense of regular users, who are set to form the core workforce of the envisaged increase in labour market participation.
Support for young disabled persons
The social partners formulated a clear approach to resolving the issue of the rapidly rising number of young people with a disability: the measures proposed include a later medical check for claimants under the Disability Insurance (Young Disabled Persons) Act (Wet Arbeidsongeschiktheidsvoorziening Jonggehandicapten, WAJONG), encouraging companies to employ more young people with a disability, as well as including stipulations in collective agreements directed at finding suitable traineeships and providing properly adjusted positions (NL0805019I).
Marianne Grünell, Hugo Sinzheimer Institute (HSI)