The development and current situation of employers’ organisations

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The Employers and Industrialists Federation (OEB) is the sole central employers' association in Cyprus. It has 51 member sectoral associations and represents about 4,500 enterprises employing some 57% of the total labour force. This article examines the development of employers' organisations and their current situation in 2003.

To date, the structure, organisation and operation of employers’ organisations in Cyprus have not been studied and examined in a systematic way. Most references to this matter are contained in papers which either examine issues of labour law and industrial relations in general, or approach the issue of the organisation of employers historically.

The largest employers’ organisations in Cyprus are currently:

• the Employers and Industrialists Federation (OEB);

• the Cyprus Federation of the Associations of Building Contractors;

• the Cyprus Association of Bank Employers; and

• the Pancyprian Association of Hoteliers (PASYXE).

Of these, the most representative employers’ association is OEB, which is regarded as the main national 'peak' association in Cyprus. Indeed, the main feature of the representation of employers’ interests in the field of industrial relations in Cyprus is considered to be the grouping of all employers’ organisations exclusively in OEB, an umbrella organisation which represents the whole spectrum of enterprises, in all sectors of economic activity. These include industry, constructions, services, trade, agriculture and private education.

Organisation and development of OEB

OEB was established in 1960 soon after the establishment of the Republic, and has been operating since then as an independent organisation which represents the business community in Cyprus. Originally, it was known as the Employers’ Advisory Association of Cyprus. In 1970, it was renamed the Cyprus Employers’ Federation before subsequently assuming its current name.

The change of the organisation's name over time was important, in that it reflected changes, both on the organisational level and in connection with OEB's aims and competences. From being a clearly advisory body over 1960-70, OEB became the third recognised social partner with a role equal to that of the trade unions in the shaping of industrial, social and economic policy in Cyprus. In addition, OEB has to a large extent undertaken the role of a coordinating body among employers as a whole.

According to the last annual report of OEB, covering 2002, the federation comprises 51 'professional' (branch/sector) associations and about 4,500 enterprises, of which around 600 are direct members. The enterprises which are members of OEB employ about 57% of the total labour force of the country, corresponding to about 171,000 employees. With regard to the size of the enterprises which belong to OEB, the overwhelming majority are small and medium-sized, whereas about 80% are active in the service sector. It should be noted that in statistics on Cyprus's economy, the size of enterprises is determined as follows:

• small enterprises are those which employ one-15 employees;

• medium enterprises are those which employ 15-249 employees; and

• large enterprises are those which employ over 250 employees.

The growth and development of OEB has been significantly affected on two occasions. The first occasion was 1974 , when the Turkish invasion severely disrupted the federation, many of its members closed down and many members of its secretariat either resigned or emigrated abroad. The second phase lasted the whole of the 1990s and reflected in particular the rapid economic growth of the service sector. More specifically, during the 1990s, 15 professional associations in the service sector joined OEB, while in the three-year period 2000-2 its member associations in the service sector increased from 19 to 26. In this framework, from 1989 onwards OEB became very active in efforts to promote the interests of service enterprises. These efforts included the establishment of a services department which has responsibility for the systematic and in-depth analysis of issues related to the service sector. Other initiatives include special publications and the organisation of a Euro-Mediterranean Services Fair.

Tasks and responsibilities of OEB

The statutes of OEB prescribe the following objectives:

• to defend and promote the system of private enterprise and the free economy;

• to promote economic development and consequently achieve comprehensive social progress where economic conditions permit it;

• to facilitate the economic and institutional harmonisation of Cyprus with the 'acquis communautaire'- the body of EU law which candidate countries must implement;

• to safeguard and promote the interests of its members within an internationalised business environment and mainly in the context of the EU single market; and

• to keep the balance of power between employers, trade unions and all pressure groups within the pluralistic decision-making system of Cyprus.

In order to achieve the above goals. OEB undertakes responsibility:

• to make representations to all public agencies, trade unions and other bodes related to economic, fiscal, tax, labour and environmental issues, as well as industrial and services matters. In particular, within the context of social cooperation for the shaping of the industrial, financial and social policy of the country, OEB is represented in all relevant agencies, as well as in all the committees of the competent ministries. An indicative list includes the Industrial Advisory Body, the Industrial Tribunal, the Advisory Economic Committee and the Human Resources Development Authority of Cyprus;

• to participate in various official tripartite and other committees, with the aim of protecting and promoting the employers' side against 'excessive' claims by trade unions or unilateral decisions, thus facilitating and securing the development of business development;

• to inform the public via the media, the internet, conferences and seminars, press releases and special publications, in order to ensure complete understanding of the views of the business community and to incorporate them into balanced policies;

• to act as a catalyst for the shaping of a common approach between the 51 affiliated professional associations on a range of issues, as well as to act as a coordinating body between its members, where necessary;

• to represent the business community in international organisations and fora in order to follow international developments closely and to promote its objectives. To this end, OEB is an official member of the International Organisation of Employers (IOE), the Union of Industrial and Employers’ Confederations of Europe (UNICE), the Union of Mediterranean Confederations of Enterprises (UMCE), the International Labour Organisation (ILO) Governing Body and the European Services Network (ESN), as well as being represented on other bodies, such as the EU's European Economic and Social Committee (EESC) and European Centre for the Development of Vocational Training (CEDEFOP); and

• to cooperate with employers’ and industrialists’ organisations in many other countries, thus contributing to the development of the international economic and business relations of Cyprus.

A large and particularly important part of OEB’s activity concerns the conduct of industrial relations between its members and their employees or the trade unions which represent them, and above all its role as a negotiating body on behalf of its members, with regard to setting the terms and conditions of employment and the settlement of disputes. In this context, over and above its capacity as a direct negotiating body, OEB provides its members with full support in all issues related to industrial relations. In particular, OEB offers its members:

• assistance in examining and evaluating workers' demands, before negotiations with the trade unions;

• assistance throughout the course of collective bargaining;

• information and statistical data on prevailing pay levels, fringe benefits and issues of working conditions; and

• information and advice on the correct handling of industrial disputes, the implementation of labour legislation, and matters relating to the working environment and health and safety at the workplace.

Other OEB initiatives include carrying out studies and research regarding industry and other sectors of the economy, holding training seminars and providing vocational training for its members. OEB is exclusively funded by the contributions of its members and no state funding is provided.

Other employers’ organisations

The Cyprus Chamber of Commerce and Industry (CCCI) was established in 1927 with the aim of systematically monitoring developments in trade and industry, as well as undertaking action and measures to promote general business interests in these sectors. However, and contrary to the provisions of its statutes, owing to the absence of employers’ representation in Cyprus at the time, CCCI was obliged to represent employers’ interests for almost 30 years, both in the context of collective bargaining over the conclusion of collective agreement and in the broader context of the shaping of an institutional framework of industrial relations. With the establishment of OEB in 1960 as a specialised organisation, CCCI's role as a negotiating body and official 'social interlocutor' began to be restricted to its original duties. The result of this development was conflict between OEB and CCCI, mainly regarding the representation of employers’ interests, as well as efforts by CCCI to claim a more active role in the industrial relations.

Both the Cyprus Federation of the Associations of Building Contractors and the Cyprus Association of Bank Employers are registered members of OEB and are active at sectoral level as the main negotiating bodies for their members. In contrast, the Pancyprian Federation of Hoteliers, following a recent disagreement with OEB, joined CCCI.

Finally, there are also organisations which provide a 'mixed' representation of business interests. The largest such organisation is the Pancyprian Professional Small Shopkeepers Federation (POBEK) which has around 8,000 members, of which about 60% are employers, who are active in the technical occupations, clothing, recreation centres and petrol stations.

Commentary

The characteristics of employers’ organisation in Cyprus - and in particular the grouping of forces in an umbrella body, the upgraded role of OEB as the key coordinating body of all employers, and the high level of representation - have contributed decisively to the shaping of a relatively good climate in industrial relations in Cyprus. The good climate mainly concerns the shaping of a system of industrial relations which is largely based on tripartite cooperation between the parties, both at national and sectoral level. (Cyprus Labour Institute, INEK-PEO)