A decision taken by the Mediation and Arbitration Service (OMED) earlier this year recommends that all economically dependent workers be included in the collective agreement for employees in the sector. The decision has sparked strong opposition from the employer organisation, the Association of Technical Companies of the Highest Classes, which has applied to the courts to have it annulled.
Arbitration decision
In early March 2007, the Mediation and Arbitration Service (Organismos Mesolavisis ke Dietisias, OMED) issued Arbitration Decision No. 13/2007 on the pay and working conditions of employees in technical, construction and design companies situated in the southern region of Attica and including the areas of Athens and Piraeus. Article 3 of this decision describes the relationship of subordination based on its essential characteristics, regardless of its formal expression. Specifically, it acknowledges that:
There is a contract of employment and, for that reason, a salaried worker is subject to the provisions of this decision, regardless of the manner in which the salary is determined or paid, provided that the worker is placed in a position of legal subordination by the employer.
This article merely reiterates the existing provisions of the law and accepts case law that was settled years ago. However, it is of great significance as it draws attention to a problematic labour relations issue – namely, that of economically dependent worker s. This issue affects a number of different sectors and professions – such as journalists and lawyers – and involves a substantial number of the country’s economically active population.
Situation of economically dependent workers
Economically dependent workers are employees who are treated by their employers as self-employed providers of independent services, but who are in fact economically dependent on a single employer for their source of income and thus in a position of subordination. To receive payment, these workers must issue an invoice for services rendered; this reduces labour costs for the employer. It also increases the potential for violating these workers’ rights, as they are obliged to relinquish all of their rights – such as those concerning lawful working hours, allowances, holiday bonuses and insurance contributions paid by the employer – since they are outside the scope of labour legislation and collective agreements. This issue constitutes part of the broader concern regarding the problem of undeclared work. When asked to give a profile of these pseudo self-employed workers, Professor Lefteris Papagiannakis from the National Technical University of Athens (EMP) outlined that:
These are mainly young people who provide their services exclusively to a specific enterprise, but who, when threatened with unemployment, agree to sign continuous and repeated flexible contracts under false pretences (mainly work contracts, but also fixed-term contracts).
Economically dependent workers in engineering sector
According to a study by the EMP, entitled ‘The absorption of engineers in the labour market’:
Today, 50% of young engineers, in order to find work, must be ready to accept flexible employment relationships, when 30 years ago only 5% faced the same reality…. This category (i.e. economically dependant workers) is a hybrid form of employment. By the term hybrid form of employment, we mean the type of employment relationship resulting from the combination of two different categories of employment (self-employed and employees) and bearing some of the characteristics of each of those categories. For example, the manner in which an employee is paid or insured is the same as that of a self-employed person, but the employer/employee relationship is similar to that of an employee.
Research by the Technical Chamber of Greece (TEE), published in February 2007, notes that, as a rule, employers are the ones who suggest the idea of an invoice for services rendered as a manner of payment, whereas only 9% of such employees appear to have been informed of their employment rights. Furthermore, the research demonstrates that these pseudo self-employed workers receive lower pay than comparable employees.
Employer organisation seeks reversal of decision
During collective bargaining, the employer organisations insisted that they did not want the slightest reference to employees paid as providers of independent services or working in flexible forms of employment and paid in other ways, such as by the hour, to be included in agreements. They argued that any worker wishing to do so could seek legal redress.
Immediately after the OMED issued its arbitration decision, the Association of Technical Companies of the Highest Classes (STEAT) instituted protective measures and filed a complaint against the organisation, requesting that Article 3 of the decision be abolished on the grounds that OMED had overstepped its competencies. According to STEAT, Article 3 of the decision:
provides a pretext for disputes between the companies and the counter parties as to whether this lawful relationship is a relationship involving subordination or not.
In addition it foresees that:
such disputes will also give rise to court battles entailing financial costs and hardship for the litigants, but also a danger that a contrary decision will be issued.
Commentary
The significance of Arbitration Decision 13/2007 is obvious. For the first time, the problem of economically dependent workers has been acknowledged and its solution suggested – namely, that all economically dependent workers be included in the collective agreement for employees in the sector. Efforts have already begun towards the conclusion, for the first time, of a collective agreement in the information technology (IT) and new technologies sector, which show a high prevalence of economically dependent workers since the phenomenon first came into being.
Sofia Lampousaki, Labour Institute of Greek General Confederation of Labour/Confederation of Public Servants (INE GSEE/ADEDY)