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An important deal on the renewal of the national collective agreement for Italy's 82,000 industrial managers was reached in September 2004 by the Confindustria employers' confederation and the Federmanager managers' association. The accord is highly innovative and introduces significant changes with regard to pay, welfare provision and supplementary pension coverage. The signatories view the deal as a first step towards a new model of industrial relations for managers.
There are around 82,000 'industrial managers' (dirigenti industriali) in Italy. Just over 76,500 of them are men and only 5,400 are women. Their average age is around 50. The large majority work in small and medium-sized firms, while just over a quarter work in large companies.
The National Federation of Industrial Company Managers (Federazione Nazionale Dirigenti di Aziende Industriali, Federmanager) is the sole representative organisation for industrial managers. Its members are executives in small, medium-sized and large companies, in all sectors of private industry but also in publicly-owned or controlled enterprises. Besides engaging in collective bargaining for the whole industry sector, Federmanager also maintains a presence at company level through plant-level union structure s (rappresentanze sindacali aziendali, Rsas) for managers. There are three principal bodies providing welfare, pensions and training for managers in service (though not to their family members): Previndai, the supplementary pension fund for industrial managers; Fasi, which provides healthcare coverage; and Fondirigenti, which provides continuing training. All three are bipartite bodies, co-managed with the employers represented by the General Confederation of Italian Industry (Confederazione Generale dell’Industria Italiana, Confindustria).
The 2002-3 national industry-wide collective agreement, signed on 26 March 2003, introduced - if only on paper - a number of significant innovations in industrial relations, and during negotiations discussion centred on a number of novel measures concerning pay levels, supplementary pensions, supplementary health coverage, in-service training, and income support in the event of unemployment. The discussion, however, was not followed by concrete initiatives to adopt these innovations.
New agreement
On 21 September 2004, after 11 months of negotiations, a deal was reached between Confindustria and Federmanager for the renewal of the national-level agreement for the 82,000 industrial managers (the previous deal had expired on 31 December 2003). The agreement contains a number of significant provisions which introduce - in fact and not just on paper - changes to a number of areas, such as new pay scales, a bipartite unemployment fund, an employment agency, and increased welfare and social security coverage.
The main points of the deal, which contains 'the essential elements for agreement on renewal of the national-level agreement', are as follows.
- Duration. Whereas previously there was a two-year pay agreement and a four-year one on other 'normative' issues, the new agreement is in force for five years and will cover the period from January 2004 to December 2008.
- New pay system. The contractual minimum salary levels pegged to basic monthly pay have been abolished. The new pay system consists of a minimum guaranteed salary (trattamento minimo complessivo di garanzia, Tmcg), which is the fixed basic pay level for all managers, based on length of service. The Tmcg will be adjusted on a multi-year basis established by the parties (previously, adjustment took place every two years).
- Seniority abolished. Seniority pay increments will abolished for managers hired after the definitive signing of the new national collective agreement. For those already in service, a transitional arrangement will maintain the seniority system for five years, after which seniority increments will be transformed into individual bonuses.
- Health and pensions. The agreement increases the funding of Previndai (social security) and Fasi (health) by allowing employers (on the basis of company-level agreements) or individual managers to increase their contributions.
- Unemployment. The agreement creates a bipartite fund providing income support for managers in the event of job loss, the aim being to supplement the amount and extend the duration of the unemployment benefit paid by the state.
- Training and new employment. The bipartite body for continuing training (Fondirigenti), set up in 2002, will identify the training and skills-updating needs of managers, as well as monitoring the effectiveness of the training delivered. Moreover, Fondirigenti will create an experimental employment agency for the retraining and redeployment of unemployed or redundant managers.
Reactions
Reactions to the accord have been extremely positive on both sides. For Alberto Bombassei, the Confindustria vice-president for industrial relations: 'the deal completes the path that we began in 2003 when the national agreement was renewed for 2002-3. The agreement will incorporate the innovative contents defined by this understanding. The new national agreement, which will last for five years, focuses on the manager’s status by containing measures mainly concerned to strengthen contractual provisions on supplementary social security, health coverage and vocational training.'
The president of Federmanager, Edoardo Lazzati, believes that: 'the new contractual model is entirely coherent with the evolution of the managerial role, which is increasingly centred on individual responsibility and on pay increments tied to corporate and individual performance. In this new situation, it is essential that the right to individual bargaining should be established in all companies, and for every manager. This is a significant cultural change, especially for small and medium-sized firms.'
Commentary
The deal on renewal of the national collective agreement for industrial managers is indubitably innovative in respect of its contents and solutions. The main innovation is the protection afforded for the first time to managers who lose their jobs. Two measures are provided in this case. The first consists of a bipartite fund to provide income support and supplement state unemployment benefit. It therefore performs a 'passive' function, typical of such 'social shock absorbers' (IT0311306T). By contrast, the second measure is 'active', in that the creation of an employment agency will favour the prolongation of careers - especially among managers aged over 50, who are most likely to be expelled from the labour market - by providing professional retraining and outplacement services.
Another significant innovation is the new pay system. The collective agreement will no longer establish minimum pay scales. Instead, pay dynamics will be based more closely on a direct relationship between company and manager, while the agreement fixes the 'minimum guaranteed salary' (Tmcg). This change seems to be consistent with the distinctive nature of managerial work, where remuneration will be increasingly linked to the company’s economic results.
Finally to be stressed is the appropriate weight given by the deal to supplementary pensions, which constitute the second pillar of the national social security system. Previndai, with its 60,000 members, is the largest capitalised pension fund operating in Italy, which highlights the need to reinforce the supplementary system in view of the future reduction of state social security coverage (IT0409101F). (Livio Muratore, Ires Lombardia)