Paper industry conflict resolved

The social partners in the Finnish paper industry finally concluded negotiations over new collective agreements on 1 July 2005, bringing to an end a six-week national lock-out of blue-collar paper workers by the Finnish Forest Industries Federation. A key issue in the conflict was the use of subcontracted labour.

Negotiations over a new collective agreement between the Finnish Paper Workers’ Union (Paperiliitto) and the Finnish Forest Industries Federation (Metsäteollisuus) were in a deadlock throughout the first half of 2005 (FI0504202N and FI0505201N). To hasten the negotiations, Paperiliitto began a three-day national strike of blue-collar paper workers on 15 May, and this was followed by a national lock-out of the strikers by Metsäteollisuus until the resolution of the conflict six weeks later. During the lock-out, two mediation bids were made by the national conciliator. Metsäteollisuus would have accepted both of these but Paperiliitto saw the bids as containing cuts in workers’ benefits and as such rejected them.

On 29 June the heads of the two social partner organisations finally reached an agreement with the help of the national conciliator and two days later on 1 July the deal was ratified by their decision making bodies. The new collective agreement has a validity period of three years and it raises wages during the first two years by 4.4%. This is roughly equal to the pay increases of the recent 2½-year centralised agreement that covers about 90% of Finnish employees (FI0501203F). As such, it is in line with the objectives of Paperiliitto. The pay increases of the third year are to be decided later on. Wage levels were not, however, a particularly contentious issue in the negotiations. The main row was in the end over the use of subcontracted labour, which Paperiliitto had not been prepared to let inside the factories. Finally, the union consented to employer demands and allowed its use, albeit only under strictly specified circumstances: subcontracted labour is to be used only if the social partners at the workplace level agree to do so. If consensus cannot be reached at local level, Paperiliitto and Metsäteollisuus are to resolve the matter in sectoral negotiations, and if there is still no agreement after that, a group partly independent of the two organisations is to make binding resolutions. Another contentious issue in the negotiations was production stoppages during Christmas and the midsummer holiday. The new agreement scrapped these as wished by the employers. Workers were compensated with a working time reduction of 11 hours, which Paperiliitto had throughout the negotiations maintained as being grossly inadequate. A third highly disputed issue was the installation of 12-hour shifts. In this respect as well, Paperiliitto yielded to the demands of Metsäteollisuus, although the shifts are only to be installed if locally agreed. Paperiliitto managed, nonetheless, to block various employer demands including the splitting up of summer holidays and the scrapping of the payment of wages during the first two days of sick leave.

Metsäteollisuus expressed its content with the new collective agreement. It sees it as being a positive step in safeguarding the competitiveness of Finnish paper industry. The chair of Paperiliitto, Jouko Ahonen, was less enthusiastic and lamented the fact that union could not secure a deal in line with the centralised agreement, which was its main objective. He maintains that the new agreement includes various cuts in workers benefits that were not included in the centralised deal.

The collective agreement negotiations between Metsäteollisuus and the Union of Salaried Employees (Toimihenkilöunioni, TU), which represents white-collar workers in the paper industry, were also concluded on 1 July. According to TU, the new agreement includes neither major cuts in benefits nor significant improvements. The validity period of the agreement is three years and it raises salaries by just over 6%.

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