SOCIAL DIALOGUE IN SOUTH-EASTERN EUROPEAN COUNTRIES ... · 3. the impact of international...

SOCIAL DIALOGUE IN SOUTH-EASTERNEUROPEAN COUNTRIES: POSSIBILITIES,LIMITATIONS, PERSPECTIVES

THE EUROPEAN TRAINING FOUNDATION IS THEEUROPEAN UNION’S CENTRE OF EXPERTISESUPPORTING VOCATIONAL EDUCATION AND TRAININGREFORM IN THIRD COUNTRIES IN THE CONTEXT OFTHE EU EXTERNAL RELATIONS PROGRAMMES

HOW TO CONTACT US

Further information on our activities, calls for

tender and job opportunities can be found on

our web site: www.etf.eu.int.

For any additional information please contact:

External Communication Unit

European Training Foundation

Villa Gualino

Viale Settimio Severo 65

I – 10133 Torino

T +39 011 630 2222

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E [email protected]

Darko Marinkovic

Belgrade, July 2002

SOCIAL DIALOGUE INSOUTH-EASTERN EUROPEANCOUNTRIES: POSSIBILITIES,LIMITATIONS, PERSPECTIVES

TABLE OF CONTENTS

FOREWORD 7

INTRODUCTION 9

1. THE SOCIAL AND ECONOMIC ENVIRONMENT FOR THE ESTABLISHMENT

OF SOCIAL DIALOGUE 11

2. THE HISTORICAL COURSE AND INITIAL STEPS TOWARDS SOCIAL DIALOGUE 15

3. THE IMPACT OF INTERNATIONAL INSTITUTIONS ON THE DEVELOPMENT OF

SOCIAL DIALOGUE IN SOUTH-EASTERN EUROPEAN COUNTRIES 21

4. THE LEGAL FRAMEWORK FOR THE ESTABLISHMENT AND DEVELOPMENT

OF SOCIAL DIALOGUE 29

5. LEVELS OF SOCIAL DIALOGUE 39

6. PARTICIPANTS IN SOCIAL DIALOGUE 45

7. THE ORGANISATIONAL STRUCTURE OF SOCIAL DIALOGUE 55

8. THE WORK OF THE SOCIAL AND ECONOMIC COUNCILS 63

9. COLLECTIVE BARGAINING 71

10. SPECIFIC FORMS OF SOCIAL DIALOGUE 81

11. THE SETTLEMENT OF INDUSTRIAL CONFLICTS 87

12. FINAL CONSIDERATIONS 91

SOCIAL DIALOGUE IN SEE - SEMINAR OF BUCHAREST17–18 June 2002Summary of the conclusions from the three working groups

13. BIBLIOGRAPHY 97

5

FOREWORD

When in January 2000, during theconference held in Thessaloniki (Greece)the representatives of the RoyaumontProcess (which has now been incorporatedinto the Stability Pact for south-easternEurope) and the European Union’sEconomic and Social Committee, ETF wasrequested to establish a project for thewestern Balkans with a view to buttressingconcepts and national and regionalstructures in the field of social partnership,we considered this as a challenge for ourorganisation.

This initiative was designed to develop orreinforce the bargaining abilities of thesocial partners in order to thrash outproblems related to the skill needs ofemployers, job security andrecommendations for taking strike action (ademocratic right) only as a last resort. Forthis is an area in which many of thestructures, working methods and attitudesthat have governed social partnership wereinfluenced by the conditions and politicalsystems in place before the 1990s. In fact,some of the issues at stake pose realchallenges for some of the participatingcountries and territories.

The project had at its core the aim ofproviding training in a range of areasrelating to social partnership, such asnegotiation skills (transfer of the bestpractice of the EU countries) to a targetedgroup of representatives fromorganisations (trade unions and employers’organisations, ministries of labour andother civil organisations) involved in socialpartnership functions in each country andat regional level.

An average of 40 social partners from allnine countries involved, took part in thefollowing:

Study visit to Rome, September 2001.

1. Study visit to Brussels, February 2002.2. Seminar in Bucharest, June 2002.3. Conference in Thessaloniki, September

2002.4. Training session, in Zagreb, March 2003.

In addition, in each country, a nationalreport was prepared on the state of thesocial dialogue and findings disseminatedthrough specific seminars.

These nine reports are the basis of thepresent comparative analysis, which wasdiscussed during the Conference inThessaloniki. The presentation of this finalreport, is also a good occasion for makingan analysis of the contribution made by theproject and the hard task that is still to betackled.

The project has contributed to:

� Creating or reinforcing relations andunderstanding at the national, regionaland European level.

� Increasing capacity through goodpractices presented during the studyvisits and training carried out inBrussels, Bucharest and Zagreb.

� Better understanding of the need forsocial dialogue through reviewing it atcountry level and disseminationseminars.

� Indirect contribution to the peace andstability of the region through increasedconfidence among project participants.

� Developed capacity of analysis of needsby the participant organisations.

7

� Developed understanding of the need tocreate a new cross-border cooperation.

� Broad understanding of the need toestablish or consolidate cooperationwith social partners in Europe and theirorganisations.

But there is still much to be done; thefollowing challenges remain:

� The weakness of social partners needsto be addressed through massivetraining initiatives.

� The regional dimension should bemaintained by reinforcing existingnetworks or establishing new ones,which should meet regularly.

� All social partners in the region shouldmeet together at least once a yearinviting other relevant social partners’organisations from the rest of Europe.

� Help for national governments andsocial partners in developing aregulatory framework to facilitate thedevelopment of a social dialogue.

� Support for new social partners in thosecountries where such a process is still inits embryonic stage.

� Help to the civil society in supporting theabove process.

I would like to thank all the authorities(European Commission, Economic andSocial Committee, Stability Pact), theItalian CNEL, the Greek OKE, ETUC,UNICE and all the participant organisationsthat made it possible to accomplish thisgood result. I would also like to thankFrancesco Panzica, who has coordinatedthe project on behalf of ETF.

Peter de Rooij, Director of ETF

8

ETUC RECOMMENDATIONSFOR BETTER USE OFTHE REPORT

The comparative report has put together aconsiderable amount of information on theemerging systems of labour relations in theregion of South-East Europe includingnumerous and extensive references tolegal texts, regulations and otherarrangements. It points to the complexity ofthe problems faced in the building of socialdimension of the stabilisation andassociation process and attempts to outlinecertain possible comparisons with theEuropean standards and practices. In thissense the report provides descriptions ofthe set up of industrial relations inparticular situations, certain more analyticalinsights in the issues and incentives forfurther development of social dialogue inthe region through the identification of"good practices".

Following the main orientation of theproject, the report is an attempt to buildpotential in the local social dialogue actorsfor strategy formulation and implementationof jointly agreed policies in complex reformrealities. To that end the insights andconclusions can serve as tools in theprocess of change in searching for themost adequate solutions in each society inthe region. Using the report for such amore instrumental approach necessitatesto bear in mind a few importantconsiderations:

1. In the theoretical and the practicalparts of the text the interpretationsand analysis have not achievedsufficient level of clear differentiationbetween "social" and "civil" dialogueand the respective actors andarrangements involved. Naturallyboth processes are linked and canreinforce each other as elements ofthe development of representativedemocracy, yet they are notinterchangeable and can notindiscriminately interfere in therespective arrangements. Aspresented in the report, in the caseof the Balkans the picture has beenfurther complicated by naming puretripartite bodies at national level"Economic and Social Councils". Inthe tradition of the EU and even inCEE such wording would designatemultipartite structures with differentobjectives and patterns of activitythan tripartism. In that line the onlycase where a clear distinctionbetween the two has been attempted- in Bulgaria, obviously deservedmore attention to paid and monitorwhat opportunities it can create formore efficient social dialogueprocess.

2. Following these problems there arenot many "good practices" clearly

9

identified and analysed as to assessthe possibility of their application inother conditions as well as theirrelevance to the challenges of thereform process on one side and tothe European standards andpractices on the other.

3. In order to strengthen theimplementation effects of the reportthe user will profit more if the readingis complemented with particulardocuments and analytical materialson social dialogue of the EuropeanCommission and the social partnersat European level and CEE countries.

There are enough definitions andinterpretations, related to the socialdialogue in the EU and the so calledEuropean Social Model (or models)operating in reality on broadly similarassumptions and principles. Thesewould provide a wider choice ofanswers to the problems raised inthe report and strengthen theinspirations for designing localsolutions while providing dynamics inthe development of policies in thesocial sphere of "European" nature.

Grigor Gradev,ETUC Coordinator forStability pact for SEE

10

SOCIAL DIALOGUE IN SOUTH-EASTERN EUROPEAN COUNTRIES:POSSIBILITIES, LIMITATIONS, PERSPECTIVES

INTRODUCTION

The countries of south-eastern Europe arecurrently facing one of the greatestchallenges in their history. For almost adecade and a half they have beenexperiencing an extremely complex andcontradictory social process, moreprecisely a whole range of interrelatedprocesses, which scientists, analysts andpoliticians term with a commondenominator – transition.

This general term, the semantics of whichindicates movement, development, orevolution from one form, stage or style toanother – in other words, change – impliesa substantial change in these societies, thedismantling of the old and the emergenceof a new social structure – the creation ofnew social values, a new political andeconomic organisation of society, that is tosay, a new way of life.

Since the very beginning only the basiccharacteristics of the new social order werefamiliar: i.e. private property, a marketeconomy, multiparty parliamentarydemocracy, civil institutions, humanfreedom and rights. This is significant, butinsufficient.

Social practice has definitely refutedscientists’ and experts’ unrealisticallyoptimistic expectations of the duration andsocial consequences of the transitionprocess. It turned out to be a much longer,more complex and contradictory socialprocess with very painful consequences.

The issues of the progress towardstransition, the contradictions and obstaclesin its path, the social cost of transition andhow it could be covered are still open andwill remain permanently on the agenda.Theoverriding issue is that of the human

and moral meaning of the transitionprocess and socially bearable cost of thisprocess, particularly for the wage-earningsocial strata.

The socially acceptable cost of thetransition process is the subject of veryprofound and radical social conflicts, whichmore or less shake all societies undergoingtransition. The results of empirical researchand the course of political and economicprocesses in the previous decadeunquestionably confirm that citizens andemployees are aware of the need forchanges, of the fact that changes arealready taking place daily and are willing toaccept these changes.

The fact that in the elections of September2000, and during the events of thefollowing October, citizens opted for socialchanges (they confirmed this in December2000 in the elections for the RepublicAssembly) may perhaps conceal a moreimportant fact – that they have differentexpectations from these changes, that is,that they relate them to different socialgoals. Experience in the research of publicopinion, positions and values, as well asobservation of citizens’ behaviour at publicgatherings lead to the conclusion that thereare four basic and relatively general goals:

1. Establishment of democratic politicalorder (expressed also as an ideadealing with the exercising of civil rights,democratic society).

2. Transformation of the system ofownership (privatisation) and theestablishment of a market-basedeconomy.

3. Solution to social problems and raisingof the general standard (conditionally,the idea of social justice).

11

4. A satisfactory solution of the nationalissue (once dominant, but for manycitizens still important goal).

For most citizens these goals are notmutually exclusive, but are rather

complementary. However, everyone candefine his/her own order of priorities.Therefore, we asked respondents to rankthese four goals according to their ownassessment of their relevance.

12

Priority social goals: Percentage of respondents who attribute a certain rank to each goal1

Social goalsRanks

Derived

rank

1 2 3 4 5

Establishment ofdemocratic politicalorder

34% 12% 7% 45% 4

Establishment ofmarket economy,privatisation

24% 34% 14% 2

Satisfactory solutionto the national issue

25% 32% 22% 1

Solution of socialproblems and raisingof standards

14% 20% 53% 3

1 Mirjana Vasovic and Bora Kuzmanovic:, ‘Vrednosni prioriteti zaposlenih [Employees’ Value Priorities]’, resultsof the public opinion poll conducted in December 2000, Sindikati Srbije od sukoba ka saradnji [Trade Unionsin Serbia: From Conflict to Cooperation], Belgrade, Friedrich Ebert Stiftung /Centre for Social and DemocraticStudies 2001.

1 Mirjana Vasovic and Bora Kuzmanovic:, ‘Vrednosni prioriteti zaposlenih [Employees’ Value Priorities]’, resultsof the public opinion poll conducted in December 2000, Sindikati Srbije od sukoba ka saradnji [Trade Unionsin Serbia: From Conflict to Cooperation], Belgrade, Friedrich Ebert Stiftung /Centre for Social and DemocraticStudies 2001.

1. THE SOCIAL AND

ECONOMIC ENVIRONMENT

FOR THE ESTABLISHMENT

OF SOCIAL DIALOGUE

It should be noted that changes as suchand the necessity for them are not thesubject of social conflicts, but their socialcost and consequences. Common sensesuggests that people will only accept andsupport changes that bring them positiveresults, such as job safety, decentearnings, safety at work, a sound living andworking environment, in other words – abetter quality of life.

On the other hand, without attempting acritical evaluation of the economic policymeasures undertaken in south-easternEuropean countries or investigating thepossibilities of implementing otheralternative measures, it is obvious thatthese measures are not economically andsocially acceptable to a large part of thewage-earning population. This iscorroborated by statistical data on thestatus of national economies and thepopulation’s material and social position.They show that a high percentage of thepopulation in these countries live under the

poverty threshold – below the minimumstandard of a decent life and work. Forthese people, transition is synonymouswith unemployment, low wages, poverty,humiliation, uncertainty, etc.

Key data about the state of nationaleconomies have been analysed: industrialoutput, inflation, wages, unemployment,vital foreign-trade statistics (exports,imports, export coverage of imports,foreign-trade balance). However, althoughthis indicator is not shown, we should havein view that none of the observed countrieshas yet achieved theGDP level recorded in1989, which is considered the initial year oftransition.

The data most explicitly, with the power offacts, speak about the difficult economicsituation in these countries and theunfavourable material position of most ofthe population. In other words, thesecountries only differ in their level of poverty.These data are shown in Table 1.

13

1

Tab

le1.E

co

no

mic

ind

icato

rso

fso

uth

-easte

rnE

uro

pean

co

un

trie

s,2001

Alb

an

iaB

&H

Bu

lgari

aC

roati

aF

YR

OM

Ro

man

iaF

RY

(to

tal)

Ko

so

vo

Mo

nte

neg

ro

Are

a(k

m2)

28,7

50

51,1

30

110,9

10

56,5

40

25,7

10

238,3

90

91,2

96

––

Popula

tion

(000s)

3,4

01

3,7

50

8,1

50

4,5

00

2,0

30

22,4

43

8,3

80

2,0

34

662,5

GD

P($

mill

.)3,8

11

4,1

40

11,9

89

19,0

23

3,2

91

36,7

19

10,0

00

1,6

98

–

GD

Pper

capita

($)

1,1

20

1,1

04

1,4

71

4,2

27

1,6

21

1,6

36

1,1

93

880

–

Unem

plo

ym

ent

(regis

tere

din

000)

215

415

683

379

262

1,0

07

812

–81,8

Unem

plo

ym

entra

te(%

)16.8

38.9

/40.2

*17.9

22.3

32.2

10.5

26.8

–28.7

Inflation

(%)

01.2

/13.6

*10.3

6.2

10.6

45.7

30.6

–13.1

Budgetdeficit

(%G

DP

)-1

1-7

.20.7

-3.9

–3.5

–3.6

–6.1

–3.2

–

Fore

ign

trade

bala

nce

(%G

DP

)-2

1.4

-52.1

-14

-12.5

–23.3

–7.3

–19.9

–76.2

–

*T

he

firs

tfigure

refe

rsto

the

Federa

tion

ofB

osnia

and

Herz

egovin

a,th

esecond

toth

eR

epublik

aS

rpska.

14


14

The first indicator to attract attention is thelow level of wages. Indeed, wage levelsdiffer from one country to another. Wagesare by far the lowest in Romania (�100)and FRY (�134), followed by FYROM(�179.3). The highest wage level in theobserved group of countries is in Croatia(�484), which is nearly four times the levelin FRY and Romania. However, wages aregenerally far below those in developedmarket economies and in any case areinsufficient to secure a decent standard ofliving appropriate to the achieved level ofcivilisation. Besides representing a realsource of discontent and other industrialproblems, low wages and the consequentpoor purchasing power of the populationare obstacles to faster and more stableeconomic development.

Most of the observed countries suffer alsofrom high inflation. It is the highest inRomania at 34.5% per annum, followed byFRY at 19.7% and Bulgaria at10.3%.These data on inflation deserve nospecial comment except as a reminder thateconomists correctly identify inflation asone of the biggest obstacles to economicand technological development, andimprovement in living standards.

In any case, a positive indicator is risingindustrial output in all these countries, withthe exception of FYROM,. This increasediffers from country to country and is thehighest in the Federation of Bosnia andHerzegovina (11.4%) and the lowest inRomania (3.7%).

This indicator must be related to the factthat throughout the observed periodRomania had the highest inflation rate.However, when comparing the data on thedevelopment of industrial output we shouldbear in mind the limitations ofmethodology. Without disputing the validityof the data on the growth of industrialoutput, these should be interpreted takinginto account the level of industrial output inthe base period. If the base level is verylow, and this is more or less true of all theobserved countries, the projected growthrates must be relativised. At the same time,data on the declining industrial output inFYROM (–5.3%) should be viewed withserious economic and social alarm.

High unemployment is an inevitablecompanion of economic crisis, that is, ofeconomic, technological and socialrestructuring of national economies insouth-eastern European countries. In theFederation of Bosnia and Herzegovina itamounts to a disastrous 40%, but is alsovery high in Bulgaria, FRY and Croatia.Poor national economies are unable tostart economic development rolling andthereby creating new jobs. It should also beborne in mind that such highunemployment is inevitably accompaniedby a massive shadow economy and blackmarket, which have always been closelyconnected with organised crime. Thisfurther aggravates the already difficultsituation.

The analysed data on the economicsituation in the observed countries urgeanalysts, researchers, as well as politiciansand trade unions to seek out the causes ofsuch contradictions and obstacles toeconomic and social development, that is,to answer the question of why thesecountries are less successful in this regard.By their very nature, trade unions are mostconcerned with this, because theconsequences of such a situation affectworkers most.

The causes of such a situation arenumerous, very complex and can be foundin all spheres of social life. This studyshould contribute to arriving at part of theanswer to the question of whether theunsatisfactory level of the development ofsocial dialogue contributes to this situation.In this context it is indisputable that thedescribed economic situation is by nomeans favourable for the development ofsocial dialogue. A specific form of socialdialogue – conflicting social dialogue –develops as the result of such anunfavourable social environment.

Difficult economic and social situations areadditionally aggravated by the veryunfavourable economic legacy of theprevious system, that is, by the fact that allthese societies embarked upon transitionfrom a very low base, which can barelymeet the requirements of radical changesin the economic, social and politicalstructure of society. All this when

15

1. THE SOCIAL AND ECONOMIC ENVIRONMENT FOR THE ESTABLISHMENT OFSOCIAL DIALOGUE


accompanied by ignorance, lack ofexperience and tradition in thedevelopment and functioning of democraticinstitutions in society, raises numerousdoubts about the way the problems insociety can be resolved.

Owing to the above-mentioned reasons, allsocieties in south-eastern Europe are in adominantly conflicting situation. In actualfact, these conflicts manifest themselves atdifferent intensity and in different waysfrom one country to another, because ofspecifics in the historical heritage and thepast course of transition. However, a highdegree of conflict is the dominant feature ofthese societies. This additionally hampersthe already difficult economic and socialsituation in these societies, becauseconflicts, particularly of such greatintensity, actually hamper reformprocesses, make themcostliereconomically and hang as a SwordDamocles over all south-eastern Europeancountries, facing them with numeroussocial and political risks, warning thatsocial conflicts may cross the critical lineand turn into something much moredangerous.

In other words, it could be said that thecountries of south-eastern Europe are atthe crossroads between industrial (i.e.social) conflict and social peace, which isbuilt and exercised through the mechanismof social dialogue. The experience so farunquestionably confirms that the bestresults in the transition process have beenachieved by the countries that managed toachieve a minimum national socialconsensus on the ways and social cost oftransition and on this basis have developedmechanisms of social dialogue and socialpeace. This means that the countries ofthis region have to focus on thedevelopment and functioning of themechanisms of social dialogue and socialpeace as one of the vital issues of theirfuture.

Whether to choose conflict or socialdialogue is no dilemma in fact. The rightquestion would be how to go from conflictto dialogue, that is, how to make dialoguedominant in relation to conflict in the longrun.

16

2. THE HISTORICAL COURSE

AND INITIAL STEPS

TOWARDS SOCIAL

DIALOGUE

Under the pressure of mounting socialcontradictions and the need for theirpermanent and systematic solution,south-eastern European countries startedto make the first steps towards theestablishment and development ofmechanisms of social dialogue. In doingthis, they had in view many decades ofexperience of developed, democraticfree-market countries which have atradition of social dialogue, positiveattitudes by all social partners and haveproved that social dialogue is one of thecornerstones of a democratic social orderand efficient mechanism for theharmonisation of positions and differinginterests of social actors.

However, as in other similar situations, itturned out that experiences of developed,democratic countries, above all the EUmember states, which have established ahighly developed and efficient model ofsocial dialogue, are necessary as one ofthe initial elements, but they are not

sufficient. First of all, uncritical, mechanicalcopying is not possible or, more precisely,it is unreasonable. Certain mechanismscan be very efficient in certain socialcircumstances, but in other circumstances,in a different social environment, theireffect can be very limited, that is, they canbe an empty form not relevant to the socialdialogue that has been established. Thishas been unquestionably confirmed by thefirst experiences of transition where modelsand the course of introduction of socialdialogue have their specific characteristicsin each of these countries.

Therefore, what we are discussing here isa social environment that makes possiblethe establishment and functioning of socialdialogue in its essential meaning. Forinstance, historical experience of bothindustrialised democratic Europeancountries and transition countries, includingsouth-eastern Europe, has clearlyconfirmed that the establishment and realfunctioning of social dialogue is possible

17

2

only at a certain level of political, economicand social development of society.

Many of these conditions (degrees oftechnological and economic development,standards, functioning of institutions ofmulti-party parliamentary democracy, civicinstitutions, human rights) are not yet inplace in south-eastern European countriesand form one of the biggest obstacles tothe establishment and development ofsocial dialogue.

In fact, establishment of the new socialenvironment, that is, the fundamentalcharacteristics of the new society, is thesubject of social dialogue and currentsocial conflicts. This process has anotherimportant aspect – social partners throughcurrent conflicts and dialogue, besidesreconciling current different interests, strivefor securing as good a starting position aspossible in the time to come. This meansthat social dialogue, inter alia, is based ona relative balance of social power betweensocial partners. However, this social poweris never ideally distributed and even asmall advantage of one of the socialpartners makes it possible for it to play adominant role in social dialogue.Experience to date has confirmed thatobjectively the weakest partner in theserelations is the trade unions, whilegovernment is the most powerful one. Thisfact makes the government – the politicalpower – the most responsible, particularlyin the first stages of the establishment ofinstitutions and mechanisms of socialdialogue. It is the so-called objectiveresponsibility, because the governmentholds in its hands all the levers of authoritywhereby it is possible to dominate,positively or negatively, the establishmentof social dialogue.

Establishment and development of socialdialogue in certain south-eastern Europeancountries has run a very specific course,caused by an extremely hostile socialenvironment in which the transition processtook place. We are discussing Serbia andCroatia. On their way towards socialchanges both countries faced nationalism,armed conflict and the joining of allpro-reform forces in order to establish ademocratic order as the first condition for

the introduction of social dialogue. Thisurged the trade unions and relevantpolitical forces to conclude specific socialcompacts on the joint struggle for socialchanges, as well as on the principles andgoals they strive towards in the new socialcircumstances. That was actually a specificform of social dialogue about the first stepstowards social change.

The national report of Croatia describesthat situation in the following way:

In order to understand the present state ofthe tripartite social dialogue it would benecessary to return to the recent past.Namely, in November 1999 the strongesttrade union centre, the Confederation ofAutonomous Trade Unions of Croatia(SSSH), concluded ‘The Compact for aJust Croatia’ with six then leadingopposition political parties. Some of the keyelements of that Compact referred to: thecreation of the programme of developmentand restructuring of the Croatian economy;revision of transformation and privatisation;reform of the employment system; reformof the pension system; changes of theLabour Law, etc. The conclusion of thisCompact resulted in the support of theSSSH to these parties in the January 2000elections.

According to the analysis of the fulfilmentof the provisions of the Compact for a JustCroatia, compiled by the SSSH in October2001, most of the provisions have beencarried out or their execution is under way.

Favourable climate of social partnership inthe latter half of 2001 enabled the draftingand conclusion of the agreementPartnership for Development, whichdefined 17 common goals. The agreementwas signed on 22 December 2001 by therepresentatives of the Government,employers and four trade union centres(SSSH, Matica, HUS and URSH), whileNHS never signed the agreement.

The preamble of this document stressesthe following: ‘Aware of the seriousness ofeconomic and social circumstances, whichrequire from all social and political forces toassume full responsibility in order to help,by setting an example, in the mobilisation


18

of all social groups and human potential inthe Republic of Croatia, we advocate thepromotion of the principle of tripartism andthe achievement of consensus at thenational level about the main economic andsocial issues.

Social partners are aware that the entiresociety is undergoing serious structuralchanges, the process of strengtheningmarket mechanisms and exercising of therule of law. In the forthcoming period thiswill call for the implementation of reformsthat will require considerable sacrifice ofsocial partners and citizens in the firststage, with protection of the socially andmaterially most vulnerable categories ofthe population (workers with the lowestwages, unemployed, families with manychildren, pensioners with the lowestpensions and other socially deprivedcitizens)’.2

In Serbia, then opposition parties (nowparties in power) concluded in May 2000with TUC ‘Nezavisnost’ the Compact for aDemocratic and Socially Just Serbia, bywhich all the parties undertook, if theycome to power, to take care of the interestsof employees and trade unions inconducting their policies.

The preamble to this document reads:

Socially just and democratic Serbia, is notonly a strategic commitment of TUCNezavisnost and all democratic forces,which will render possible permanent andcomprehensive protection of the interestsof the world of labour, but the only feasibleanswer to the long-standing political,economic and social crisis and degradationof civil society in Serbia.

Unanimous in the opinion that in almost allaspects of social life, as well as in personalfates, the society is in the situation that avast majority of social institutions andeconomic resources are completelydestroyed, or exist in extremely deformedforms, so that they have to be built anew;

Committed to the development of

democratic, socially just Serbia, based on

the values of developed Europe and the

world, as the necessary prerequisite for our

reintegration into international community,

which requires maximum motivation and

full engagement of all available material

and creative potentials;

Convinced that our county has ample

resources which offer the possibility for

overcoming the profound social crisis in a

relatively short time, and that the most

important among them is the creative

power of the world of labour, whose

interests and rights are represented andprotected by independent trade unions;

TUC Nezavisnost and political partiesconclude

THE COMPACT

FOR A DEMOCRATIC, SOCIALLY JUST

SERBIA

Unfortunately, this Compact produced farless effect than the quoted Compact inCroatia, because the parties that came topower have never accepted any serioussubstantiated debate on the fulfilment oftheir obligations under this document.

The present economic situation, materialand social position of the vast majority ofthe population act very restrictively on theestablishment and functioning of the socialdialogue mechanism in south-easternEuropean countries.

Except for unfavourable material and socialcircumstances, underdevelopment and thegenerally limited social power of differentparticipatory mechanisms and the influenceof employees and trade unions indecision-making in enterprises and societyrestrict the establishment and developmentof social dialogue. Historical experienceand practice in developed democraticEuropean countries have shown that socialdialogue cannot function successfullyunless employees take part and are able toinfluence decision-making.

The analysis of the historical course ofdevelopment indicates that the firststrategically important step was theunionisation of labour, an increase in tradeunion membership, raising awareness

19

2. THE HISTORICAL COURSE AND INITIAL STEPS TOWARDS SOCIAL DIALOGUE

2 National Report of Croatia, p. 33.

about their own labour and trade unionrights and a gradual strengthening of thesocial power of trade unions. This hasforced employers and political authorities togradually abandon repressive measuresand to try, in the mutual interest, to solvedisputable issues in a peaceful manner.

This has opened up the way towards theestablishment of mechanisms of collectivebargaining and collective agreements(which are actually a non-economicmechanism for regulating relations in thelabour market), employees’ right to beinformed and consulted in the process ofdecision-making on relevant issues in theenterprise, works councils and other formsof employee participation. This waspreceded, as a necessary prerequisite, bythe workers’ right to free unions, increaseof membership and strengthening of thesocial power of trade unions; namely, allforms of employees’ participation in thedecision-making process and functioning ofthe mechanism of social dialogue arebased on the establishment of a relativebalance of power between workers andemployers, such as workers’ andemployers’ organisations.

In a historical perspective, theestablishment of various forms of workers’participation has a long track record. Itrepresents a slow and painstaking winningof certain labour and civil rights, which nowconstitute the unquestionableachievements of civilisation. Every steptowards winning and establishing a certainform of industrial democracy has createdtheconditions as well as a realistic need forthe establishment of new, broader formswhich provided for greater participationand influence of employees indecision-making concerning their materialand social position and the company’sbusiness policy. At the same time, thismotivated employees to achieve betterresults at work and reinforced socialharmony once it was established. Thisgradually led to the greater social power ofemployees and trade unions.

This historical, developmental process alsocreated conditions for the participation andinfluence of employees, as one of thelargest and most vital social groups in

every society, to gradually extend beyondthe workplace to the process of politicaldecision-making. At the same time, thepractice of political organisation and civillife have increasingly and obviouslyconfirmed that multiparty parliamentarydemocracy, albeit one of the cornerstonesof democracy, is not wide enough toenable, in changed circumstances, anadequate level of citizens’ participation andinfluence in the political decision-makingprocess.

In such an analytical study of the course ofthis historical process – development ofindustrial and political democracy – weshould seek the answers to the question ofthe emergence, character, contents andobjective reach of social dialogue. In otherwords, the roots of social dialogue shouldbe sought in the development of differentforms of employee participation andindustrial democracy as a whole, theestablishment of the relative balance ofpowers and social harmony between theworld of labour and the world of capital andthe actual limitations of multipartyparliamentary democracy. In other words,social dialogue is the product of theprogress of civil society during thetwentieth century, a bridge conceived andconstructed over a long period, whichconnects political, multiparty parliamentarydemocracy and industrial democracy, andwhich comes together into a new whole,providing essentially new qualities to thepolitical life of society. Building anddeveloping social dialogue institutionsenable the integration of the splitpersonality of a member of the world oflabour and a free citizen, because boththese sides have the same source – freecitizens as the foundation of a free civilsociety. Such an approach leads to thediscovery of relevant, substantiatedanswers to numerous dilemmas,theoretical and practical controversies anddoubts about the relationship betweensocial dialogue, collective bargaining andworkers’ participation. What can beaccepted as indisputable is that socialdialogue, collective bargaining andworkers’ participation constitute a set ofachievements of modern civilisation, whichhave been won progressively, and whichare interrelated and in interactive; only as


20

a whole can they fulfil their human andhistorical meaning.

The human and historical meaning ofsocial dialogue is particularly apparent andexpressed in specific way in south-easternEuropean countries. This is theconsequence of the course of this processin both the EU and the countries ofsouth-eastern Europe. This means that theprocess of construction of democraticpolitical institutions, workers’ participationand social dialogue in the EU countriescontinued much longer and followed, wemay say conditionally, its natural course,though it does not necessarily mean thatthis process was without contradictions andconflicts. Clearly, it is unrealistic to expectthat this process can proceed at the samepace, follow the same forms and continuefor the same time in south-easternEuropean countries. After all, history hason numerous occasions refuted thepossibility of such copying of socialprocesses and relations. What isnoticeable is that this process is takingplace in a generally unfavourable socialenvironment and that it is very dynamic,though it does not appear as such at firstglance. In other words, the intensity ofprocesses leading to the establishment ofsocial dialogue mechanisms isexceptionally strong and that by itselfcreates new risks and challenges. In theprocess of establishing and developingsocial dialogue we may even notice anapparent pattern – that the passage of timeis also a necessary factor for theestablishment of new institutions andrelations, including unquestionably socialdialogue. Human factors, motivation,efforts to build new institutions and makethem function realistically may contribute tothe dynamics of the process, but thiscontribution has its major limitations.

Confirmation for this can be found in thecomparison of form as well as content –real social functions and powers of socialdialogue. A comparative analysis of theforms through which social dialogue iscarried out in the EU and the SEEcountries indicates that similar formsconceal different contents. In this sense,the fact that countries in bothabove-mentioned groups often have very

similar forms through which they conductsocial dialogue (composition of the socialdialogue bodies, manner of their election,internal organisation) cannot automaticallyserve as an indicator that the situation ofsocial dialogue in them is similar. First ofall, the contents of social dialogue in thesetwo groups of countries differ. This iscaused by differences in the degree ofeconomic, technological and socialdevelopment of these countries. Of course,this does not mean that developed EUcountries are free ofrom conflict andconfrontation of opposing interests. But it isthe differences in the level of economic andtechnological development, in the quality oflife of members of the labour-force and thepopulation in general that make thegreatest difference. Relative socialharmony was established in the EUcountries decades ago and peacepredominates in the mechanisms andfunctioning of social dialogue, while in thesouth-eastern European countries socialharmony is only just being established,while conflicts predominate in themechanisms and practice of socialdialogue.

When comparing social dialoguemechanisms in the EU and south-easternEuropean countries, we should not fail toobserve that even the most ideallydesigned social dialogue mechanism is anempty lifeless form unless supported by itsoriginal principles – voluntariness,autonomy of will and mutual confidence ofthe actors in social dialogue. This impliesthat all three social partners (employers,trade unions and government, with thelatter having quite a specific role in socialdialogue) must have a strongly developedconsciousness about the benefit each ofthe parties gains from participation in socialdialogue.

Comparative data on the manner offorming and operating social and economiccouncils show that these bodies arefounded in two ways – through theagreement between social partners or bylaw. The practice has confirmed that eachof these ways has its advantages and itsshortcomings, and that each of theobserved countries of south-easternEurope has chosen the one or the other

21

2. THE HISTORICAL COURSE AND INITIAL STEPS TOWARDS SOCIAL DIALOGUE


way proceeding from the assessment of itsown specific needs. However, thedifferences in the way councils arefounded, which are essentially conceptual,pose a question about the relationshipbetween legislative and autonomousregulations, accepted by a consensus ofsocial partners and concerning thedefinition of the scope, composition andworking methods of social and economiccouncils, as well as the level at which theyare organised. Both approaches containvalid arguments: namely, if social dialogueis based on voluntariness and the principleof goodwill between actors, it is logical thatrelations in social dialogue are regulated byautonomous regulations, that is, by anagreement of partners through socialdialogue. However, practice has alsoconfirmed the need to protect minimumstandards and rules of conduct in socialdialogue by the power of the law. In otherwords, it is necessary to find an optimumrelationship between the legislative andautonomous regulation of actors in socialdialogue. This raises a new legal andpolitical question – the definition of thelegal power of this autonomous regulation.

The establishment and development ofsocial dialogue mechanisms insouth-eastern European countries is aprocess under way. For the time being, theprocess is carried out at the national level.This is of indisputable strategic importance,but is insufficient. Very intensive integratingprocesses currently unfolding within the EU

and Europe as a whole, as well as ongoingpolitical, economic and other processes insouth-eastern Europe, are facing socialdialogue with new challenges. Although theprocesses of economic, technological andpolitical cooperation betweensouth-eastern European countries isdeveloping very slowly due to a range oflimiting factors and the negative legacy ofthe past, this cooperation will inevitably, bythe force of economic and technologicallaws, proceed increasingly faster and withgreater intensity. This is presenting tradeunions and other social partners with newquestions and challenges relating to thestrategy of regional development, theposition of the world of labour and realisticconsequences of integrating processes onthe changes in the structure and manner ofthe functioning of the labour market. EUcountries and their trade unions havealready travelled a long stretch of road inthese processes, which south-easternEuropean countries can use as aguidepost. One of these experiencesunquestionably confirms that the road toEuropean and international integrationgoes via regional cooperation. Thisprocess will largely determine the contentsof social dialogue at the national andregional level. But social theory andpractice are already facing the questionwhether and to what extent can socialdialogue mechanisms influence theshaping of these processes in the region.This comparative analysis forms part of theefforts in that direction.

22

3. THE IMPACT OF

INTERNATIONAL

INSTITUTIONS ON THE

DEVELOPMENT OF SOCIAL

DIALOGUE IN

SOUTH-EASTERN EUROPEAN

COUNTRIES

In addition to internal political, economicand social circumstances, power,experiences and interests of socialpartners, the establishment anddevelopment of social dialogue insouth-eastern European countries are alsounder the influence of internationalinstitutions. That influence was exercisedwithin the overall influence of developedEuropean and non-European countries andinternational institutions on the course ofdevelopment of the transition process insouth-eastern European countries.

Particularly significant in this regard wasthe influence of:

� the European Union;� international trade union organisations;� the International Labour Organisation;� international financial institutions.

The European Union provided a strongimpetus to the process of establishing anddeveloping social dialogue in south-easternEuropean countries. It did so through thepower of its own experience and the wholerange of economic and political measuresby which it influenced the politicalauthorities, trade unions and employers inSEE countries to build lasting and stablesocial harmony and to resolve currentsocial and industrial conflicts peacefully.

There is no doubt that social dialogue isone of the cornerstones of the EuropeanUnion. When we say this, we must have inview that the main foothold of socialdialogue in the European Union is thedevelopment and power of social dialoguein certain EU member countries.

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3


Historically speaking, we may say that theprocess of establishment and developmentof social dialogue proceeded in parallelwith the development of the EuropeanUnion, that is, it was an integral part of thatprocess.

The beginning of this process was theTreaty of Rome, by which the EuropeanCommission was obliged to consult socialpartners on issues of common policy andthe implementation of fundamental rights.

The European Social Charter, adopted in1961 and later amended, has strategicimportance for the development of socialdialogue in the European Union.

Amendments to the Treaty on theEuropean Union provided a new incentiveto the development of social dialogue in the1980–90 period. According to theseamendments, the European Commission isobliged to encourage social dialoguebetween employers and trade unions. Inthis regard, the Treaty of Maastricht (1991)introduced the right of trade unions to priorconsultations and ‘framework negotiations’.Framework agreements regulate a largernumber of important economic and socialrights of employees at the EU level.

Sectoral social dialogue developsintensively in certain sectors and branchesof industry and in other activities. Theactors in this process are, respectively,trade union federations and employers’associations. The results of these sectoraldialogues are sectoral collectiveagreements, which are implementedautomatically in relevant sectors at thenational level.

The variety of forms as well as the realpower and objective reach of socialdialogue in the European Union has beenenriched by the European Works Councils.The competent bodies of the EuropeanUnion enacted a directive in this regard in1994 and that process proceeds with evergreater intensity. This process unfolds inthe so-called European companies whichhave at least 1,000 employees and at leasttwo branches in other countries with atleast 150 employees. Through thesecouncils the employees exercise the rightto information and consultation.

The Economic and Social Committee(ECOSOC) is strategically important andhas a role in the development of socialdialogue within the framework of theEuropean Union. This body was founded in1957 on the tripartite principle and iscomposed of representatives ofgovernment, employers and trade unions.The Economic and Social Committee hasseven sections within its field: (a)economic, financial and monetary issues;(b) foreign relations; (c) trade anddevelopment; (d) social, family,educational and cultural issues;(e)protection of health, environment andconsumers’ interests, (f) agriculture andfisheries; and (g) regional development,industry, crafts, services, transport andcommunications, energy, nuclear issuesand research.

As far as the influence of the EU on thedevelopment of social dialogue in SEEcountries is concerned, it has to be takeninto account that transition in thesecountries carried and still carries very highsocial costs. The situation is furtheraggravated by the fact that all thesecountries had to devote more attention tothe issues of macro-economic stability andstructural reform and had to push socialissues to the background. This was underthe particular influence of the so-called‘shock therapy’ theory, which was stronglyadhered to in the first years of transition.

In the later phases of transition, under thepressure of mounting social contradictionsand conflicts, growing attention wasdevoted to the social dimensions of thetransition process.

Particularly important in this regard is theTreaty on Stabilisation and Associationbetween the EU and SEE countries, whichencompasses a number of social issues,having in view that EU enlargement willnecessarily have certain socialconsequences.

In 1995 the European Commissionadopted the so-called ‘White Book’ for thepreparation of central and easternEuropean countries for integration into theinternal market of the European Union.This strategic document contains aseparate section on social policy, pointing

24

out primarily to governments but also toother social partners that social anddemocratic standards, including socialdialogue mechanisms, are an integral partof the package of conditions for joining theEuropean Union. This was veryencouraging in the sense that greaterattention is being paid to the social aspectsof transition and development of socialdialogue in central and eastern Europeancountries.

The key step in the establishment anddevelopment of social dialogue, as anintegral part of a democratic and humanetransition, was made with the adoption ofthe Stability Pact for South-eastern Europe.

Where the participation and contribution ofinternational trade union organisations tothe establishment and development ofsocial dialogue in SEE countries areconcerned, we should particularlyemphasise the active role and contributionof the ETUC. It was carried out throughassistance and support to democratic tradeunions, their capacity building in thestruggle for employees’ economic, socialand trade-union rights, promotion ofEuropean democratic and humanisticvalues, advantages of social harmonycompared with social conflict, and realisticprogrammes with the aim of establishingand developing social dialogue in thecountries of south-eastern Europe.

The ICFTU influenced social dialogue inSEE countries primarily through itscharacteristic strategy for the developmentof a strong, democratic trade unionmovement, respect of trade unionfreedoms and rights as an indisputableaccomplishment of civilisation, andstrengthening the social power of tradeunions.

The International Labour Organisation alsohas a strong influence on the developmentof social dialogue in south-easternEuropean countries. The tripartiteorganisational structure of the ILO was ofenormous importance for the success ofthis task, which gave this organisation thepossibility of encouraging simultaneouslyall three social partners – government,employers and trade unions – to develop

social dialogue and to harmonise theircontradictory interests through socialdialogue.

International financial organisations, aboveall the IMF and the World Bank, exercisedconsiderable influence on the course,content and objective reach of socialdialogue in south-eastern Europeancountries. They were in fact the fourth,invisible partner in social dialogue, settingbefore the governments of these countriesdemands referring to macro-economic andfinancial stability, which necessarilyproduced certain social results.

However, the governments of thesecountries often blamed internationalfinancial institutions for economicdifficulties experienced by transitioncountries, thus attempting to hide their ownfailures.

The theoretical and methodological

framework of the project

The essence of this project is the conceptand practice of the establishment anddevelopment of social dialogue in thecountries covered by the Stability Pact.Theoretical and empirical knowledge so farconfirm that it is an exceptionally complexissue, which encompasses a whole rangeof differing aspectswhich are connectedand interrelated to practically all key areasof civil life. Indisputable and readilyapparent is the interaction between socialdialogue, the political system and civil life,economic policy and the economic system,living standards, such as the quality of lifeof the population. In other words, socialdialogue can only theoretically beseparated from the complex of political andeconomic processes in society, with theaim of a systematic, comprehensive studyof this phenomenon.

That is why the first step in the study is todefine the notion of social dialogue, that is,what the term ‘social dialogue’ will imply inthis project. This is the first and necessarycondition for focusing research efforts onthe essence of the researched subject.

Before starting to define the notion of socialdialogue it is necessary to make one

25

3. THE IMPACT OF INTERNATIONAL INSTITUTIONS ON THE DEVELOPMENT OFSOCIAL DIALOGUE IN SOUTH-EASTERN EUROPEAN COUNTRIES

methodological/theoretical reservation,common to this type of research andanalytical projects. It is necessary to realisethat definitions in general are not final andunchangeable truths about certainphenomena and relations, but auxiliary,working scientific tools intended tosystematise and generalise knowledgeabout certain phenomena and relationsand to set them clearly apart fromneighbouring, mutually related andinterconnected phenomena. Therefore, theterm ‘working definition’ or ‘operationaldefinition’ is often used in research, in thetheoretical and methodological approach insocial sciences and/or in social processeswhich are the subject of the research. Thatis particularly pronounced in the researchof complex social phenomena andrelations, where social dialogue also falls.These shortcomings will also be present inthe definition of social dialogue in thisstudy. It is therefore the first, initial step forsubstantiated critical analysis and debate.

At first it appears easy to define the notionof social dialogue. Numerous definitions ofsocial dialogue appear in social theory,research, as well as in practical life. Thesedifferences are caused by differenttheoretical, political and ideologicalapproaches, as well as by differentapproaches and practice in the process ofbuilding social dialogue in certaincountries. However, these differences onlyconfirm theoretical and practical difficultiesencountered by anyone trying to define thenotion of social dialogue.

As in the definition of other complex socialphenomena and processes, in thedefinition of the notion of social dialogue itis easy to slip into one of the two extremes.The first extreme is too broad a definition,where general characteristics of socialdialogue are absolutised, thereby losingdiferentia specifica in relation to social andpolitical processes in society as a whole.The second extreme is too narrow adefinition of the notion of social dialogue,when social dialogue is most frequentlyequated with formal-legal mechanismsthrough which it is carried out. Each ofthese extremes ultimately obstructs waysof getting to the heart of the meaning ofsocial dialogue.

Owing to all the above-mentioned, theinitial position in the definition of the notionof social dialogue must be dynamic anddevelopmental, rather than static. Thismeans that social dialogue is not a staticsystem or mechanism; it is not a condition,but a social process. Only by embarkingupon social dialogue as a social process isit possible to grasp its historical anddevelopmental character, dynamic motivefactors of that process in present socialevents, as well as interaction with othersocial processes. If social dialogue isdefined as a historical and developmentalsocial process, then we should add to thisan essentially new characteristic of thissocial process. Social dialogue representsa radically new stage in the development ofthe political organisation of society, animportant historical step in a process thatcommenced with bourgeois revolutions,first in France and then in other countriesof Europe and the world, placing the freecitizen at the centre of political and socialevents, which changes the majorcharacteristics of political life, introducesnew actors and changes relations of socialpower between them.

This general characteristic should besupplemented with a narrower, morespecific one – that social dialogue is aspecific social process, emerging at acertain level of political and economicdevelopment of society, in which politicaland economic democracy through variousmechanisms organically links to a newwhole, while employees’ participation in thedecision-making process turns into auniversal value. Social dialogue in thiscontext represents the answer to thegrowing role and influence of governmentin the economic life of society, or a creativeresponse to the risk of the emergence of anew Leviathan.

This wider theoretical approach representsthe starting point for the definition of socialdialogue in the narrower, operationalsense. Of course, it is necessary to have inview the interrelationship and interactionbetween the theoretical and operationaldefinition of social dialogue, namely, thebreadth of the theoretical definition, degreeof its comprehensiveness, as well asdifferent theoretical standpoints about the


26

notion of social dialogue and its contentsdetermine the contents of operationaldefinitions of social dialogue. Too wide atheoretical definition inevitably bringsconfusion into operational definitions ofsocial dialogue, which also, following acertain theoretical model, become too wideand imprecise. On the other hand, toonarrow theoretical definitions of socialdialogue result in unnecessary or, to bemore precise, false dilemmas about allimportant elements that constitute socialdialogue in the operational sense.

If social dialogue is defined on a broadertheoretical plan as a social, historicalprocess, in which essentially new elementsof democratic order and political life ofsociety are created, then social dialogue inthe narrower operational sense may bedefined as a system of mechanisms andrelations established by relevant socialpartners in the aim of their organised,systematic participation and influence onpolitical processes and relations in society,that is, definition and carrying outthestrategy of socio-economic and politicaldevelopment of society, harmonisation oftheir different interests and the peacefulsolution of possible industrial and socialconflict.

However, the above-mentioned position isonly a starting point for the operationaldefinition of social dialogue, becauseoperational definition in an empirical andtheoretical study of a phenomenon mayfulfil its purpose only if it is sufficiently solidand precise. In this sense, in order to arriveat sufficiently solid and precise operationaldefinition of social dialogue we will use theanalytical method of separation of certainelements of this operational definition, thatis, observation and study of certainelements of the structure of socialdialogue.

The following elements of the socialdialogue structure are important for itsoperational definition:

� International standards defined in thedocuments of the UN, ILO and otherinternational organisations andinternational legal norms.

� A legal basis of social dialogue definedin national constitutions and laws, aswell as in autonomous legal-politicalregulations of social partners.

� Mechanisms through which socialdialogue is carried out – organsengaging in social dialogue, manner oftheir election, internal organisation,working bodies, participation of experts,sources and process of financing,decision-makingmethods, execution ofpositions and decisions, etc.

� Contents of social dialogue – issuesdiscussed by organs and bodies withinwhich social dialogue is carried out,possibilities for classification of theseissues.

� Actors of social dialogue (socialpartners) – government, trade unions,employers and others who participate insocial dialogue.

� Criteria for the evaluation of theobjective reach of social dialogue andthe social power of the organs withinwhich social dialogue is carried out.

� Social dialogue and other areas ofsocial life bordering on social dialogue.

� The social environment in which socialdialogue takes place.

Of course, each of the elements of thisoperational definition of social dialogueshould be separately analysed. However,the intention of this study – a comparativeanalysis of different models and practice ofsocial dialogue in countries ofsouth-eastern Europe – does not leavemuch room for broader theoreticaldeliberations of the individual elementsmentioned above. This analysis willtherefore be made as a practical analysisof solid models and their functioning,specific features and commondenominators of these models. In otherwords, the emphasis in the study will be onpractical, actual functioning of themechanisms of social dialogue, on realpolitical and social processes unfolding inthis plan. This is primarily dictated by thevery character of these processes, whichare live, dynamic and changeable. Ofcourse, in doing so we should be awarethat the analysis in this case, too, will befaced by the limitations encountered,above all, in empirical research in the

27


social sciences. To put it another way, thestudy of the essence of certain socialprocesses, in this case social dialogue,always returns to the formal aspects ofthese processes, which are readily visibleand relatively measurable.

Only at a first glance does it appear thatthere are no substantial differences in thedefinition of the notion of social dialogue ona wider theoretical and operational plan.However, apparent similarities are oftenonly an optical illusion. A more profoundtheoretical effort reveals that a range ofconsiderably different definitions of socialdialogue appear both in theory andpractice. It is certain that one of the majorsources of these differences can be foundin the author’s general theoretical andideological preferences. These differencesare particularly apparent in the evaluationof the real social power of social dialogue,that is to say, in the role it can play insocial relations as a whole. At the sametime, these differences have their basisprimarily in the real life of differentsocieties. It is clear that social dialoguedoes not have the same content indeveloped and economicallyunderdeveloped societies, in societies withvery different degrees of development ofdemocratic institutions. Key actors of socialdialogue are formally the same in allcountries: government, trade unions andemployers, that is, their relevantorganisations. However, it is clear that theposition of employers’ organisations ortrade unions, for example, in Albania,Poland or Italy, is not the same, that theposition and role of the state in socialdialogue in different countries ofsouth-eastern Europe is not the same. Inaddition, certain countries introduced awider sphere of social actors in socialdialogue mechanisms, alongsidegovernment, employers and trade unions,so that we can no longer speak of atripartite but rather a polypartite structure ofsocial dialogue.

Finally, differences in the definition of thenotion of social dialogue arise fromdifferent practical experiences – numerousdilemmas and open issues in the definitionof the notion of social dialogue are theconsequence of the fact that social

dialogue in south-eastern Europeancountries is only at the embryonic stage.

Facing the existence of considerabledifferences in the definition of socialdialogue the following should be taken intoconsideration. The starting point of polemicand different approaches to social dialogueare different definitions, because they leadto different theoretical positions anddifferent practical approaches.

There are a large number of doubts andopen issues in theoretical models of socialdialogue. In order to achieve the goals ofthis project, the following issues deserve tobe separately analysed.

The first of the theoretical controversiesrefers to the scope of social dialogue, thatis, what elements are considered to belongto social dialogue. Some authors includeunder social dialogue only tripartite bodies(government, employers, trade unions),which are usually called social andeconomic councils, at the national, regionaland local level. They strictly distance socialdialogue and its mechanisms from themechanisms of industrial democracy,which also include collective bargaining.The second group of authors treatcollective bargaining, particularly at thebranch and national level, as one of theforms of social dialogue. This secondopinion has its historical materialfoundation in the course of development ofcollective bargaining and social dialogue.Finally, it is difficult to imagine successfuland efficient functioning of social dialoguein contemporary society without adeveloped collective bargainingmechanism. This is supported by thecontinuous expansion of the subject ofcollective bargaining to issues that are bytheir nature strategically political.

The next group of theoretical dissensionrefers to the role of the state in socialdialogue. This issue is also present in otherareas of social life. It has an even greaterspecific weight in transition countries dueto the exceptional concentration of powerand the dominant role and influence of thestate in the first phase of transition. In thiscase, too, there are two extremes. One ofthem totally negates the role of state as a


28

social partner in social dialogue, stressingthat it is in contradiction with the principalrole and functions of the government insocial processes. The other group ofauthors overemphasise the role of the statein social dialogue and/or fail to noticediferentia specifica of the government insocial dialogue in relation to other socialpartners. Such views have their roots in thecontradictory position of the state in socialdialogue. Plainly stated, the governmententers social dialogue having in its handsall the levers of power. The development ofsocial dialogue in fact deprives thegovernment of some of its powers,transferring them to social dialoguemechanisms, and hence changing theirnature.

The next issue over which theoretical andpractical differences appear refers to thedelimitation between individual and jointfunctions of social partners in socialdialogue. That is to say, every socialpartner engages in social dialogue for itsown specific reasons, with the main aim ofprotecting its own interests through socialdialogue. It follows that every socialpartner, that is, their representatives in thebodies where social dialogue takes place,play their own individual role and functions.It is clear that the role of the employer insocial dialogue, for example, differsconsiderably from the role of the tradeunion and government. At the same time,all participants in social dialogue, which isin its essence an interactive process, alsocarry out some common functions, whichare the necessary condition for thesuccessful functioning of social dialogue.As a result, social theory and practice arefaced with the issue of distinguishingbetween the individual and commonfunctions that social partners exercisethrough the mechanism and process ofsocial dialogue. This relationship isimportant, because it enables theresearcher to identify disintegrating andintegrating, conflicting and peaceful,aspects of social dialogue.

A major theoretical as well as practicalissue is the definition of the criteria for theevaluation of efficiency and success ofsocial dialogue. First of all, efficiency andsuccess of social dialogue have their

numerous and varied aspects – legal,political, economic and human. Whichcriteria are the most relevant and the mostreliable? Are these criteria measurable andto what extent? The formal existence ofsocial dialogue does not automaticallymean that it can function successfully andefficiently. On the contrary, very often it isonly an empty form. A valid answer to thisquestion requires that the social andhuman essence of social dialogue –democratisation of society andhumanisation of human life – be taken as astarting point. After all, this is a search forthe answer to whether there is aconnection between the establishment anddevelopment of the mechanisms of socialdialogue and quality of life of ordinarypeople, and how this connection ismanifested.

Finally, in theoretical deliberations it isnecessary to develop a heuristic aspect ofthe theory of social question. It can be setthrough the question of perspectives, thefuture of social dialogue. More precisely,the question of the mutual relationshipbetween the social dialogue mechanismsand the political organisation of society isbecoming increasingly topical. Thisquestion may also be phrased in thefollowing way: Can social dialogue, as asubstantially new form of relations, replacecertain standard models of politicalorganisation and civil life ?

In the methodological sense, in theelaboration of the project, analysis,classification and presentation ofdocuments we have used the comparativemethod, which falls in the category ofcomplex method in social sciences. Thismethod enables certain social phenomenaand/or processes be reviewed in theirtotality, as a distinct whole; it enablesspecific characteristics of the establishmentand development of social dialogue in eachof the observed countries of south-easternEurope to be identified, as well as commonelements of social dialogue in thesecountries to be identified, separated andanalysed. Of course, we will primarilycompare the visible and measurableaspects, hence the system of socialdialogue mechanisms. The comparativemethod implies concurrent implementation

29



of the analytical/synthetic method. It will bereflected in the analysis of specificcharacteristics of social dialogue inindividual countries, then in the synthesisof such data and knowledge towardsidentification of common tendencies. Wewill also use the method of content analysisof texts in documents dealing with socialdialogue in these countries. Each of thesemodels and practices of social dialogue inindividual countries of the region can betreated as a specific case of socialdialogue. In this sense, we may speakabout the use of the case-study method. Ofcourse, the statistical method will be usedas well for the analysis of data oneconomic and social development andnumerical indicators on social dialogue.Interviews with a number of competentcollocutors in different countries will beused as a specific form of empiricalresearch, in accordance with the definedsample and on the basis of aquestionnaire. Interviews based on thiscomparative study were conducted afterthe Thessaloniki Conference (1–4September 2002). This means that theseinterviews are a kind of additionalverification of the results of work on theproject.

The sum of knowledge and resultsachieved in the elaboration of the ActionPlan to Promote the Culture and Practiceof Social Dialogue, national reports onsocial dialogue in individual countries, aswell as statistical data on economic andsocial development will serve as sources ofmaterial for the comparative study.

The comparative study will encompasssocial dialogue in the following countries:Albania, Bulgaria, Serbia, Montenegro,Kosovo, Croatia, Bosnia and Herzegovina,Republika Srpska, Romania and FYROM.

The time frame of the research is thepresent, that is, the current situation andproblems of social dialogue. References tothe past will only be made to the extentnecessary to understand currentprocesses.

A comparative analysis of key aspects

of social dialogue

Comparative analysis as a methodologicalprocedure has been chosen on the basis ofmethodological-research characteristics, aswell as on the basis of experiences fromother research on similar problems, whichconfirm that this method is the mostappropriate for a comprehensive,systematic study of similarities anddifferences, that is, common denominatorsof social dialogue in the countries ofsouth-eastern Europe.

In doing this, we encountered amethodological and empirical obstacle,namely, that national reports on the state ofsocial dialogue have not been made usingthe same methodology. This required anadditional effort to make data, positionsand evaluations comparable but, in doingthis, it reduced the authenticity of data andfacts that have been the subject ofanalysis.

In the aim of being as systematic,analytical and realistic as possible, a priordivision has been made by area, that is, bykey aspects of social dialogue. In thisregard, the comparative analysis willencompass the following sections:

a) legal framework of social dialogue;levels of social dialogue;

b) participants in social dialogue;c) organisational structure of bodies and

organs (i.e. mechanisms through whichsocial dialogue is carried out);

d) powers of social dialogue bodies,contents of work (issues discussed bysocial dialogue bodies);

e) collective bargaining as a specific formof social dialogue;

f) specific, additional forms of socialdialogue; and

g) material resources necessary for thework of organs and bodies engaging insocial dialogue.

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4. THE LEGAL FRAMEWORK

FOR THE ESTABLISHMENT

AND DEVELOPMENT OF

SOCIAL DIALOGUE

It is well known that within the transitionprocess the countries of south-easternEurope undertook the reform of their legalsystems with the aim of harmonising themwith European and international standards,as well as to encourage economic anddemocratic political development andintegrate their respective countries intoEurope and the world. On this occasion,we will restrict ourselves to the elements ofthe legal systems vital for theestablishment and development of socialdialogue.

Fundamentally important in this regard isthe fact that all these countries aremembers of the United Nations, whichmeans that they are bound by strategicdocuments of this organisation on civil,human and trade union freedoms andrights. Particularly important for the subjectof our research are the Covenant on Civiland Political Rights and the Covenant onEconomic and Social Rights, which inter

alia protect the freedom of organisationand work of employees’ and employers’

organisations, which is one of thepreconditions for the establishment ofsocial dialogue.

The next important step towards theestablishment of a legal framework forsocial dialogue is to be found in the factthat all observed countries are ILOmembers, and that they have ratifiedConventions 87 and 98 of this organisation,which regulate the freedom of organisationand action of workers’ and employers’organisations, the freedom of collectivebargaining (Convention 87) and obligepolitical authorities to conduct that in noway restricts the freedom of employees’and employers’ organisations.

In addition, most countries in the regionhave adopted ILO Convention 144 onworkers’ right to consultation, andConvention 154 on the right to collectivebargaining, as well as a document of theEuropean Social Charter – Council ofEurope.

31

4

In accordance with the above-mentionedinternational legal documents, constitutionsof all observed countries in south-easternEurope protect the organisational freedomof employees and employers.

With the aim of having a real insight intothe constitutional protection of the freedomof organisation of trade unions andemployers’ organisation, we present areview of solutions in the constitutions ofthe countries under study.

CROATIA

The legal cornerstone for freedom oforganisation is provided in the Constitutionof the Republic of Croatia (Article 59),which sets forth that ‘all employees havethe right to organise trade unions and tojoin and withdraw from them freely’. TheConstitution of the Republic of Serbia setsforth:

Article 35

Anyone shall be entitled to work.

Freedom of work, free choice ofoccupation and employment andparticipation in the management shall beguaranteed. Job and public office shall beequally available to anyone, under thesame conditions.

An employee may be dismissed from hiswork against his will, under the conditionsand in a way determined by law andcollective agreement.

Forced labour shall be prohibited.

Article 36

Employees shall be entitled to adequateremuneration.

The right to material protection during theperiod of temporary unemployment shallbe guaranteed under the termsdetermined by law.

Article 44

Freedom of political, trade-union and otherorganisation and action shall beguaranteed without authorisation,provided the organisation is registeredwith the competent organ.

Action aimed at forceful change of theorder determined by the Constitution,violation of territorial integrity andindependence of the Republic of Serbia,breach of human and liberties and rightsguaranteed by the Constitution,provocation and instigation of ethnic,racial and religious animosity and hatredshall be prohibited.

BOSNIA AND HERZEGOVINA

According to the provisions of Article III,Section 3 of the Constitution of Bosnia andHerzegovina, entities are in charge ofautonomously regulating the area of workand employment, within which the issues ofsocial dialogue and the position of socialpartners in social dialogue are largelyregulated. Furthermore, the Constitution ofBosnia and Herzegovina obliges entities toimplement international regulations andstandards referring to social dialogueregardless of whether they haveincorporated them in entity legislation andto what extent, because Bosnia andHerzegovina as an ILO member hasratified many conventions, including thosereferring to social dialogue.

REPUBLIKA SRPSKA

The Constitution of the Republika Srpska(1992) in the provisions dedicated to thelabour-based rights of citizens sets forththat certain issues referring to labour, inaddition to law, can be regulated bycollective agreements, acts concluded bypartners in social dialogue through directnegotiations. This has created thepossibility and groundwork for socialdialogue, because collective bargaining isone of the forms of social dialoguebetween partners.


32

KOSOVO

Kosovo is in a specific situation after thewar in 1999, being under the UNprotectorate pursuant to the UN SCResolution 1244. The way social dialoguewill be conducted is defined according tothis resolution, which is the basis for alllegal regulations. Here is what RegulationNo. 2001/19 sets forth on this issue:

The Ministry of Labour and Social Welfareshall promote social dialogue andparticipation of social partners [Article 8]and shall convene a tripartite advisorycouncil of Provisional Institutions ofSelf-Government and employers’ andemployees’ organisations for consultationson labour, social welfare and relatedeconomic policies and represent theProvisional Institutions of Self-Governmentin this council [Article 10].

On the basis of ratified international legaldocuments and constitutions, possibilitiesand conditions for participation andfunctioning of social dialogue in theanalysed countries of south-easternEurope are regulated in more detail bynational legislation, primarily by labourlaws. This is evidenced by the followingexamples.

The first, specific, example is Kosovo, as aterritory under international administration.In October 2001, the relevant bodies ofinternational administration issuedRegulation No. 2001/27, which operates aslabour legislation, regulates the rights andobligations of parties in labour relationsand provides the legal basis for theestablishment and development of themechanisms of social dialogue.

It is worth pointing out to the specificsituation of Montenegro, where theAssembly has not yet adopted the LabourLaw, so that the only regulation in this areais the legislation of the Federal Republic ofYugoslavia: The Law on Elements ofLabour Relations, the Law on Enterprises,the Law on Strikes. However, since theauthorities of Montenegro do not recognisethe federal state or its legislation, it wouldbe more accurate to say that there existsactual legal void.

In the Republika Sprska, the Labour Law(Official Gazette of the Republika Srpska

Nos. 38/00 and 40/00), as well as theformer Law on Labour Relations (1993)created possibilities and a basis for theimplementation of the system of collectivebargaining and conclusion of collectiveagreements, as a form of dialogue betweenpartners. Unlike the Law on LabourRelations, which regulated only this issue,the Labour Law, as a modern systematicregulation in the area of labour andemployment, consistent with the new socialand economic relations resulting fromownership transformation, regulates socialdialogue in more detail and breadth.Besides creating conditions for conductingsocial dialogue on a tripartite basis throughcomplete guarantee of interest oforganisations of workers and employers,and exercising the process of collectivebargaining, the Labour Law also obligespartners in social dialogue to set uptripartite bodies through which socialdialogue can be conducted and to seek themost adequate common solutions in thearea of economic and social policy.

In the Republic of Croatia, the Labour Lawemphasises legal protection of the freedomof organisation and action of workers’ andemployers’ organisations, as a prerequisitefor the establishment and development ofsocial dialogue. In this regard, the LabourLaw of Croatia regulates the followingissues:

� the right to organisation (Article 159);� voluntary membership in the

organisation (Article 160);� prohibition of the temporary or

permanent ban of the work of anorganisation by the executive authorities(Article 161);

� possibilities for the establishment oforganisations at higher levels (Article162);

� founding and registration oforganisations (Articles 165–174);

� action within organisations: prohibitionof supervision over founding and workof trade unions by the employers;prohibition of discrimination ofemployees on the basis of theirmembership in the trade union; electionand protection of trade unionrepresentatives (Articles 177–182a).

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4. THE LEGAL FRAMEWORK FOR THE ESTABLISHMENTAND DEVELOPMENT OF SOCIAL DIALOGUE


The Labour Law defines conditions for thefounding of voluntary workers’organisations, by stipulating that tenindividuals can found a trade union.Organisations and those at a higher levelacting in the territory of a single countyshall be registered with the county office incharge of labour, while organisationswhose activity encompasses more thanone country shall be registered with theMinistry of Labour and Welfare.

The Labour Law of the Republic of Serbiadoes makes no definite reference to socialdialogue, but only in Article 130 does itmention freedom of organisation asfollows:

Article 130

Employees shall be guaranteed thefreedom of association in trade unions andtrade union activity.

Trade unions shall be established for thepurpose of protecting the rights andpromoting the professional and economicinterests of their members.

A trade union shall be established withoutauthorisation, based on entry into theregister of trade unions kept by theministry in charge of labour.

In Bulgaria the Labour Code introduced anew system of tripartism, i.e. socialdialogue. According to the Labour Code,social dialogue in Bulgaria is based on thefollowing three principles:

The first principle is legal independenceand autonomy of participants in socialdialogue. It implies rights and freedoms ofemployees’ and employers’ organisationsto organise and act without restrictions, asprovided by Articles 4 and 5 of the LabourCode.

The second is the principle that requirespolitical authorities to treat employers’ andworkers’ organisations equally, meaningthat the government cannot for the sake ofits own interests place the employers’ orworkers’ organisations in a better positionor take any discriminating action againstthem.

The third principle refers to the definitionand stressing of the specific role and

responsibilities of political authorities insocial dialogue mechanisms.

Romania is characterised by a highlyextensive system of labour legislation,unified into a coordinated whole – theLabour Code. Its new, modified andexpanded version is due to appear towardsthe end of 2002. Since such an approachto the whole of labour legislationconsiderably affects the concept of thelegal framework for social dialogue, toacquire a comprehensive insight wepresent a list of these laws, assystematised in the national report:

Legislation on the organisation andfunctioning of tripartite institutions:

� Law 109/1997 on the organisation andfunctioning of the Economic and SocialCouncil

� The organisation and functioning of theNational House for Health Insurance isestablished by Law 145/1997

� Law 145/1998 on the organisation andfunctioning of the National EmploymentAgency

� Law 132/1999 on the organisation andfunctioning of the National Council forAdults’ Professional Training

� Government Decision 779/1999 on theorganisation and functioning of theCouncil for Certification andOccupational Standards

� The organisation and functioning of theNational House for Pensions and OtherRights is established by Law 19/2000

� Government Decision 39/2000 onpassing a vote of confidence in theGovernment establishes the legal framefor setting-up new directions for tradeunions and employers, headed by statesecretaries within the ministries

� Government Decision 314/2001 on theorganisation and functioning of theCommissions for Social Dialogue withinthe ministries and prefectures

� The setting up and functioning of theNational Commission for EmploymentPromotion under Law 76/2002concerning unemployment benefits andemployment incentives

� Government Decision 276/2002 on theorganisation and functioning of theTripartite National Maritime Committee.3

34

3 The Social Dialogue in Romania – Country review.

Generally speaking, the constitutional andlegal regulations in the analysed countries ofsouth-eastern Europe in principle protect thefreedom of organisation and action ofworkers’ and employers’ organisations andthe right to collective bargaining, whichconstitute the legal groundwork for socialdialogue. Although we have analysed hereonly one narrow segment of labourlegislation, it is evident that nationallegislations in this area differ in the range ofissues they cover. This can be either theexpression of differences of opinion about theimportance and role of social dialogue in newsocial circumstances or a question ofwhether this matter should be the subject oflegal regulation at all and if so to what extent.

International legal documents, constitutionsand laws represent the basis for legalregulation of the basic principles andmechanisms of social dialogue insouth-eastern European countries. Theanalysis of the above-mentionedconstitutional and legislative provisionsgives ground for the conclusion thatsatisfactory results have been achieved inthis first, generalised plan. This is the firstcrucial step, because subsequent stepstowards the development of the legalframework and practice of social dialoguewould not be possible without it.

Of course, this statement calls for theanalysis of these subsequent steps –analysis of the legal framework of socialdialogue in the narrower sense of the word.

There are three legal grounds for theregulation of social dialogue. Theseinclude: (a) legal regulation of the founding,content and method of operation of socialand economic councils, (b) agreements onfounding – autonomous legal and politicalregulation of social partners; and (c)government decision, that is, by law. Allthree models are present in thesouth-eastern European countries underobservation, as shown in Table 2.

The data given in Table 1 point to twogroups of important factors. The first refersto the time of founding of the bodies withinwhich social dialogue is conducted (thesebodies, as a rule, are named social andeconomic councils). It is obvious that thevast majority of these bodies were foundedvery recently – in 2001 and 2002. Bulgariahas the oldest tripartite body, founded as adirect response to the then crisis, includingaggravated social and industrial conflict. Anexcerpt from the report entitled State of the

Social Dialogue in Bulgaria describes thisas follows:

The tripartite cooperation in Bulgariaemerged to fill out an existing niche. In theconditions of centralised planned economyand a totalitarian state there was no roomfor social dialogue and partnership forregulating the industrial relations.

The immediate reason to seek some toolsfor tripartite cooperation in Bulgariancontext was the first wave of protests that

35


Table 2. Legal basis for the founding of bodies in which social dialogue is conducted

Country

Legal basis for the founding of Social and

Economic Council Year

foundedAgreementof socialpartners

LawGovernment

rulingSomething

else

Albania ×

Bosnia and Herzegovina × 2002

Bulgaria × 1990

Croatia × x 2001

Kosovo × 2001

FYROM × 1996

Montenegro × 2001

Republika Srpska × 2002

Romania × 1997


swept over the country in 1998-90. OnMarch 6th, 1990, the first tripartitenegotiations were held by the Government,the Confederation of Independent TradeUnions of Bulgaria (CITUB) and theNational Association of Managers. OnMarch 15th, 1990, the same parties signeda General Agreement on the basis of whichthe National Tripartite Council forReconciliation of Interests was set up,joined by the Podkrepa Confederation ofTrade Unions (Podkrepa CTU) on 3 May1990.

On 25 March 1990 the parties in theGeneral Agreement adopted theRegulations on the National Council, an actthat marks the beginning of theinstitutionalisation of the tripartitecooperation in the country.4

The fact that bodies within which socialdialogue is taking place at the nationallevel were largely established as late as2000 or 2001 – a full decade after thebeginning of transition, when certainimportant processes in these countries hadalready taken place, or were at anadvanced stage – in a most specific wayconfirm the statement about the interactionof social environment and theestablishment and development of socialdialogue mechanisms. In other words,minimum political, economic, social andother conditions in the social environmentare necessary for even the first stepstowards the establishment of socialdialogue. The most drastic example, whichcorroborates this statement is the exampleof Serbia, where it was impossible even toinitiate any reasonable discussion aboutsocial dialogue during the autocratic rule ofSlobodan Milosevic and his nationalisticbelligerent policy.

The second group of factors refers to thelegal ground for the establishment ofbodies wherein social dialogue isconducted. The data shown inTable 1indicate that most countries (Serbia,Bulgaria, FYROM, Croatia, RepublikaSrpska, Bosnia and Herzegovina) opted toset up these bodies by autonomous legalpolitical regulations, more precisely by theagreements on the founding of social andeconomic councils.

Only two countries (Romania and Albania)founded the social and economic councilon a legal basis.

In Kosovo, because of the specificsituation, the social and economic councilwas founded following a decision bycompetent international administrationbodies and in Montenegro, where thelabour law that should regulate this issuehas not yet been enacted – by a decisionof the Speaker of the Parliament.

Solutions implemented in Kosovo andMontenegro are specific and obviouslyimposed by specific social circumstances.In this sense they are probably temporary,until they can be replaced by different,long-term solutions, like those implementedin other countries of the region.

However, analysing the other twoapproaches, we can notice that only twocountries – Romania and Albania – optedto found the economic and social councilby law. Founding of social and economiccouncils through the agreement of partiesis an absolutely important solution.

The choice of one of the studiedalternatives is determined by the real socialand economic conditions prevalent in thecountry at the time when the social andeconomic council was founded. Theexperience of Bulgaria presented in thissection, as well as the experiences of othercountries confirm that the founding ofsocial and economic councils, in addition tostrategic, long-term need, has always beenthe response and reaction to the specificsituation and relations between socialpartners. On the other hand, this has to dowith different concepts and different viewsof the role of social partners.

Both approaches have their pros and cons.It is certain that founding social andeconomic councils through the agreementof social partners, that is to say, accordingto autonomous, political legal regulations,adopted through the agreement ofpartners, reflects to a great extent theauthentic principles of social dialogue –voluntariness, autonomy of will andconfidence between social partners.

36

4 National Report of Bulgaria, p. 4.

On the other hand, the force of law, if wellproportioned and targeted, cansuccessfully protect the fundamentalprinciples of social dialogue, which isexceptionally important in the initial stage.

The solution of both dilemmas can befound in a comprehensive approach to thestudy of autonomous regulations of socialpartners and legislative regulation as partsof an integral whole of labour legislation.The justification of such a conclusion isborne out by the legal regulation of theelements of the collective bargainingsystem.

In national reports, collective bargaining istreated as one of the forms of socialdialogue. In certain countries it is in fact themost developed form of relations betweenpolitical authorities, trade unions andemployers. If collective bargaining is one ofthe forms of social dialogue, then todiscuss this problem we have to take intoconsideration that in all south-easternEuropean countries the elements of thecollective bargaining system are regulatedby law. Without elaborating at this point onthe scope and content of this legislativeregulation, we need to draw a conclusion. Ifcollective bargaining is a form of socialdialogue, and the elements of the systemare regulated by law, it means that thisregulation is also the legislative regulationof social dialogue. It follows that socialdialogue in the widest sense has mixedlegal grounds – legislation andautonomous legal political regulations ofsocial partners.

For a comprehensive insight into the legalframework of social dialogue it isnecessary to analyse the structure andcontents of agreements whereby socialpartners set up social and economiccouncils.

A comparative analysis revealsconsiderable differences in the scope andcontents of these agreements, whichreflect different positions concerning thegoals of such documents, as well asdifferent levels of knowledge andexperience of the functions of suchdocuments. In spite of this, in theseagreements we have to note certain

common denominators. This is, above all,the scope of issues regulated by theagreements. Albeit in different measure,they encompass the following:

� participants in the work of the social andeconomic council;

� goals, tasks and contents of work;� composition and method of election of

council members;� method of work and decision-making of

the council;� material conditions for the work of the

council.

In addition, common to all thesedocuments is the way that they stress theimportance and role of social andeconomic councils. This is an importantcommon political position and expectationof social partners, as confirmed by Article 1of the Protocol on the Establishment of theSocial and Economic Council in theFederation of Bosnia and Herzegovina:

Article 1

With this Protocol the Confederation ofAutonomous Trade Unions of Bosnia andHerzegovina and the Government of theFederation of Bosnia and Herzegovinastate their agreement that the Economicand Social Council be established in theterritory of the Federation of Bosnia andHerzegovina, as the highest institutionalform for conducting social dialogue, withthe aim of promoting and protectingeconomic and social rights based onsocial partnership and that pursuant to thecommon interest of the Trade Union,employers and the Government theyshould agree upon the optimum modalitiesfor conducting harmonious economic,social and development policies.

An even more complete and specificdocument in this regard is the Initiative ofthe Council of the Confederation of TradeUnions of FYROM for the founding of theSocial and Economic Council. Thisdocument, inter alia, sets forth:

Pursuant to international conventions andpractice of tripartiitism aimed atestablishing permanent social dialoguebetween trade unions, the Government andthe Chamber of Commerce and Industry,the Confederation of Trade Unions of

37



FYROM is launching an initiative for theestablishment of the Social and EconomicCouncil.

Modern society, built on market anddemocratic relations, is based on socialbalance and consensus of the holders ofsocial power – trade unions, employersand the government. This statement isbased on the knowledge and practice ofmarket economy in which newtechnologies cannot be introduced withoutthe participation of labour, and politicaldemocracy without economic and socialdemocracy. This implies the creation ofspace for social dialogue between tradeunions, employers and the government.

The essence of introduction of a tripartitebody is to articulate and reconcile differentinterests of the principal social groups. Thisenables the authorities, in the phase ofoperationalisation of policies, to haveinsight into the entirety of issues in certainareas and to have in view the opinion andinterests of social partners. This is animportant prerequisite for the enactment oflegislation or introduction of measures thatwill, observing the existing realities insociety, secure greater efficiency in theimplementation. This is a way to avoidone-sided solutions that may have harmfuleffects and frequently lead to socialconflicts.

In contemporary practice, experiences ofthe social and economic councils aredifferent, and they are established either asparliament houses or as tripartite bodies atthe national level. The Confederation ofTrade Unions of FYROM is of the opinion,on the basis of European democratictradition and practice, that in the Republicof FYROM, particularly having in view itssingle-house parliament, it would beexceptionally useful to set up a separateparliamentary body or a parliament house.Through this body or Parliament house itwould be possible to include other differentsocial actors – trade unions, professionalassociations, NGOs, independent scientificand cultural workers, renownedpersonalities – in the decision-makingabout global social projects, particularly inthe area of employees’ economic andsocial rights.5

Besides the agreements on the founding,as the principal documents, social andeconomic councils, as a rule, enact theirown internal regulations, such asprocedural rules, whereby they regulatespecific issues of their internal organisationand method of work.

The analysed data on elements of the legalframework for social dialogue point to thefollowing.

The process of putting the legal frameworkfor social dialogue in place is under way inall the observed countries, confirming theopinion of actors of this process that a legalframework is the necessary condition forthe establishment of social dialogue.

This process proceeds with varyingintensity from one country to another, asthe result of specific circumstances, that is,the social environment in which this legalframework is being created. In this context,it is necessary to be aware that the legalframework for social dialogue is only asegment of the national legal system andthat it cannot develop outside that legalsystem. In other words, in no country canlegal protection of social dialogueinstitutions be efficient, without having atthe same time legally protected humanliberties and rights, legal equality ofcitizens, etc. The intensity of activitiestowards the establishment of the legalframework for social dialogue depends onthe actors’ opinion of the importance of thelegal framework for the establishment anddevelopment of social dialogue. By thenature of their position, trade unions aremost insistent on this point, but minimumagreement between social partners aboutthe pace of this work is often lacking.

This claim is confirmed by the differencesin the degree of development, that is, thescope of the legal framework of socialdialogue. First of all, it can be noted inmost countries that the legal framework ofthe system of social dialogue is diffuse,consisting of a number of segments oflegal regulation. Due to this, certainnational reports correctly emphasise theneed for modification of this segment aswell as the whole labour legislation.

38

5 National report of Macedonia on social dialogue.

Differing degrees of legal regulation ofsocial dialogue (the scope and character ofissues in this area, which should beregulated by legal provision) shows, aboveall, the need of the weakest partner insocial dialogue – trade unions – to protectby legal provisions the basic principles ofsocial dialogue and its own position in thisprocess. However, it is obviously

necessary to undertake a more profoundanalysis and assess the optimal ratiobetween legal norms and autonomouslegal political regulation of social partners,that is, to seek answers to the question ofwhere the borderline is at which legalnorms protect without jeopardising theautonomy of social dialogue.

39


5. LEVELS OF SOCIAL

DIALOGUE

Social power, that is, the place and role ofsocial dialogue in the process of makingrelevant political, economic and socialdecisions in society depends, among otherthings, on the level at which social dialoguemechanisms are established anddeveloped. In other words, all observedsouth-eastern European countries realisedfrom the beginning the need to establishand develop social dialogue mechanismsat different levels of political and social life,namely, at different levels ofdecision-making. This is primarily theconsequence of development and thepolycentric nature of the decision-makingprocess in contemporary societies. It canbe noted that parallel development ofmultiparty parliamentary democracy,industrial democracy and forms oforganised influence of civil organisations indeveloped democratic countries of Europeand the world has resulted in thedecentralisation of the decision-makingprocess, particularly where major, strategicdecisions are concerned, at all levels ofsocial life and organisation. This shifts thedecision-making process from theinstitutions of political authority to a wider

circle of civil bodies and organisations.This is achieved either by direct transfer ofthe decision-making powers to theseorganisations and bodies, or by theorganised, systematic and increasinglystrong influence of these organisations andbodies of civil society on the bodies ofpolitical authority, which are formaldecision-makers. In this regard, thedecision-making process concerningstrategic political issues at different levelsof society is becoming increasinglycomplex, involving ever more actors.

South-eastern European countries, whichare the subject of this report have actuallyembarked on the development of the samedemocratic values as the industrialisedcountries of Europe and the world. To befactual, this process is proceeding withvarying intensity from one country toanother and with differing degrees ofsuccess. The first step in this direction iscertainly the development of a network ofdemocratic institutions. In this regard,within the comprehensive changes in thepolitical system, countries of south-easternEurope have faced the need to establish

41

5

and develop social dialogue at differentlevels of social and economic organisationand life.

The course and results of this process insouth-eastern European countries, inter

alia, are determined by the degree ofdecentralisation of the political system.This arises from the fact that the role andfunctions of social and economic councilsat different levels depend on the power thatorgans of the local self-governmentpossess. that is, what issues are withintheir decision-making competence. Ofcourse, if political system is morecentralised: if all decision-making power isconcentrated in the central bodies ofpolitical authority, such countries have lessleeway for real social dialogue at the locallevel. On the other hand, to the extent thata political system is decentralised, itbecomes more and more necessary toestablish and develop social dialoguemechanisms at the local level. In otherwords, with the decentralisation of theprocess of political decision-makingthrough transfer of decision-making rightson certain issues to the organs of localcommunities, the potential contents ofsocial dialogue is expanding. This processis unfolding in various ways and forms in allsouth-eastern European countries. Thisprocess has two main motive forces. First,the experience of all democratic countriesunquestionably bears out thatdemocratisation of society and the politicaldecision-making process is not possiblewithout the development of localself-government. Secondly, regionaldevelopment, autonomy of regions andindependence of local communities fallamong the indisputable democraticstandards that must be fulfilled as aprecondition for the accession andintegration of south-eastern Europeancountries into the European Union.

Since these two processes (developmentof local self-government and socialdialogue mechanisms) proceedsimultaneously, and since social dialogue,wherever it was introduced, proved to be areliable democratic instrument, theestablishment and development of socialdialogue may obviously act as an incentivefor the development of local

self-government and for the newdemocratic concept of local communities insouth-eastern European countries.

The starting point for the analysis of thedegree of development of social dialogueat different levels of political andadministrative organisation of society is thedefinition of social dialogue which gives ananswer to the question what elements canbe considered to belong to social dialogue.

Namely, in most national reports collectivebargaining is treated as a form of socialdialogue. Accordingly, the collectivebargaining system and collectiveagreements are presented in these reportsin separate chapters, with these chaptersusually being the most voluminous part ofthe national report on the state of socialdialogue. This confirms at least two things.First, that exceptional importance in allSouth-eastern European countries isdevoted to the development of collectivebargaining. Secondly, that collectivebargaining is very often the mostdeveloped compared with other forms ofcollective bargaining.

The example that confirms this is thefollowing position from the national reportof Romania:

The strengthening of bipartite socialdialogue is a twofold process, which hasknown a revitalising course since 2001. Inlegal terms, the strengthening of thebipartite social dialogue is achieved by theadoption of new laws on the organisationand functioning of the trade union andemployers’ organisations. The EmployersLaw was adopted in June 2001 and thenew Trade Union Law will not be adopteduntil late 2002. The ILO Project forRomania entitled ‘Promotion of theFundamental Principles and Employees’Rights and the Strengthening of the TradeUnion Oganisations in Romania’ will upholdthe strengthening of the trade unionorganisations. The Ministry of Labour andSocial Solidarity is going to support thedevelopment of the employers’ movementin Romania.

The Economic and Social Council hasassumed an important role in the


42

strengthening of the bipartite socialdialogue. In this line, the project:‘Integration of the social partnership fromthe Bread-making Sector into the EuropeanContext’, financed by the European Union,has been an important contribution to thestrengthening of the bipartite socialdialogue between the trade unions and theemployers in the mill and bread-makingbranch.

As provided under Chapter XIII – SocialPolicy and Employment – of thecomplementary Position Paper, theGovernment of Romania is going toexamine the real methods and possibilitiesto assign the social partners specificcompetencies in the implementation ofsome community directives through thecollective agreement, pursuant to article137 of the European Union Treaties.

Following the privatisation process and thedevelopment of the capacity of the socialpartners (trade unions and employers) tojointly provide assistance to their members(employees and economic operators), thebipartite dialogue will extend its benefitingeffects upon the Romanian society.6

The position about collective bargaining isexpressed very explicitly, but in specificway in the national report of Bulgaria:

As an element of the social dialogue,collective bargaining develops within theestablished system of industrial relations.

Legislative institutionalisation of the

collective bargaining in Bulgaria

1. The political and economic changescreated favourable premises forre-establishing the collective bargainingthat has a history of its own in the yearspreceding the nationalisation in 1948 inour country. There are several majorpremises in that respect:� the attitudes of the different

governments to the social dialogueat the national level;

� the overall conditions of theeconomic environment;

� the direction and contents of thedeveloping market relations, and inparticular the development of thelabour market;

� legitimising the social partners andinstitutionalising their structures;

� legislation drafting and liberalisingthe labour law.

The development of bargaining inBulgaria enabled better social protectionof employed labour in the conditions oftransition to market economy and theprevention of a number of conflicts thatwould have generated social tension.

2. The amendments to the Labour Code(LC) in 1992 (enacted on 1 January1993) provided the necessary legalsafeguards for turning collectivebargaining into a basic mechanism forregulating labour relations:� collective agreements became a

source of norms for regulatingindustrial relations for the first time;

� it opened a wide field for concludingagreements at the expense ofsevere cuts in the imperativestipulations of the Labour Code from1986, which left no space forcollective bargaining;

� it created a new model for the legalregulation of labour relations. Thelaw preserves its role of a regulatorbut contains minimum norms forlabour protection and determinesminimum level of employees’ rightsand work conditions leaving spacefor bargaining for more favourableconditions through collectiveagreements.

3. The next important step was made withthe next amendment to the LC on 31March 2001.

The changes incorporated in it result fromthe experience accumulated for more than10 years of collective bargaining inBulgaria, as well as from the need toharmonise Bulgarian labour law with theEuropean one in the period of negotiationsfor EC accession.

43

5. LEVELS OF SOCIAL DIALOGUE

6 National Report of Romania, p. 36.

Major changes concerning collectivebargaining and collective agreements canbe broadly summarised in the followingway:

In terms of the levels of collective

bargaining – Article 51 (1) stipulates that

collective agreements (CA) shall be

concluded at enterprises, branches,

industries and municipalities. The provision

from the 1992 Labour Code for entering

into CA at professional level was dropped

out, and the administrative-territorial level

is now signified by ‘municipality’.7

Proceeding from the position stated in thenational reports, according to whichcollective bargaining is one of the forms ofsocial dialogue, which has a foothold in thehistorical development and contemporarypractice of social dialogue, we mayconclude that in all observed countriessocial dialogue exists at national, branch,local and enterprise levels. Collectivebargaining and collective agreements, as aform of social dialogue, will be discussed ina separate section of this text.

However, when social and economiccouncils as tripartite bodies are taken asthe only subject of analysis, the situation ismuch less favourable. In all observedcountries social and economic councilshave been set up at the national level. Thisis a logical first step, because social andeconomic councils at the national level areconsidered as cornerstones for thedevelopment of the whole system of socialdialogue and for the establishment of socialand economic councils at other levels.

Most of the observed countries have notyet progressed any further beyond that firststep. This comes as no surprise, becausethe vast majority of the social andeconomic councils at the national levelhave been founded only in the past twoyears, which means that objectively therehas not been enough time to establishsocial and economic councils at the locallevel. Moreover, since all these countriesare burdened with numerous contradictionsand problems, which slow down the

establishment of a social dialoguemechanism. Likewise, in many cases twosocial dialogue actors – employers andtrade unions – do not have a sufficientlydeveloped local organisational, technicaland personnel structure necessary for theestablishment and functioning of socialdialogue at the local level. The samelimitation, only to a slightly lesser degree,refers also to the government. In otherwords, the establishment and developmentof social dialogue mechanisms at theregional and local level actually requireenormous human and material resources,and the shortage of these resources is oneof the main reasons why this process isproceeding very slowly.

Despite all the above-mentioned, threeexperiences referring to the establishmentand development of social dialogue at thelocal level deserve to be highlighted andseparately analysed, as they can be usefulguidelines for this process in othercountries of the region. These are theexperiences of Romania, Serbia andCroatia.

Here is an example of how the specifics ofthat model, which is elaborated in minutedetail through the relevant legislation, aredescribed in the national report ofRomania:

The tripartite institutional system for social

dialogue at the territorial and sectoral level

functions on the basis of the Government

Decision 314/2001 concerning the

organisation and functioning of the

Commissions for Social Dialogue within the

ministries and Prefectures, decision that

created the specific organisational

structures for sectoral tripartite social

dialogue. Since 2000, specialised

structures for the relation with the trade

unions and employers’ organisations,

headed by coordinating state secretaries,

have been created within 20 ministries.

The trade union and employers’

organisations were given the necessary

abilities to assume the responsibilities

concerning the work and life conditions of

the citizens, by creating the institutions

where the social partners are involved


44

7 National Report of Bulgaria, pp. 21–2.

either to advise or to decide the designing

and/or implementing of the different social

policies. Therefore, the social partners are

involved in the occupation of the labour

force, social insurance, health insurance

and professional training areas.8

For the aim of encouraging social dialogue,commissions for social dialogue have beenestablished in Romania at the level ofprefectures (units of territorialadministration). Their tasks are as follows:

To facilitate the partipation and theconsultation of the social partners on localproblems in an institutionalised frameworkfor dialogue, the comissions for socialdialogue were created at the Prefecturelevel.

These institutionalised structures debatethe issues identified at the local level,especially by the social partners, andsearch for solutions to solve them bypartnership and cooperation. A deficiencyof these structures is the large number ofparticipants, that affects the decisionmaking process and also the debates,giving a low efficiency at the results level.9

A year after the founding of the Social andEconomic Council at the national level, inSerbia dynamic activity started towardssetting up of social and economic councilsat the local level. This can be regarded asa part of an ongoing process ofdecentralisation of the political system,which was absolutely centralised at thetime of Slobodan Milosevic’s rule. This is atthe same time the answer to increasinglystrong requests for the definition of theconcept of regional communities.Organisation of social and economiccouncils in 26 regional centres, which arealso large industrial centres, is planned inthe first stage. So far these councils havebeen founded in more than ten large citiesin Serbia. The national report of Serbiadescribes this situation as follows:

The best way to pacify social tensions,which accompany and are unavoidableproduct in creating efficient marketeconomy, is the introduction of socialdialogue at the local level.

Social and Economic Councils have beenestablished at following locations: Uzice,Pirot, Leskovac, Sombor, Valjevo andSmederevo.

Founding of the network of local Social andEconomic Councils is in the process,before all, in the biggest industrial citiessuch as: Belgrade, Novi Sad, Nis andKragujevac. Beside that, starting from theneed of solving potential social conflicts,Social and Economic Councils in GornjiMilanovac, Smederevska Palanka, Bor,Loznica, Cacak, Kraljevo, Krusevac,Arandjelovac, Pancevo, Zajecar andLazarevac are in the process ofestablishing.

Since there are no funds to supportfunctioning of the Social and EconomicCouncils, the agreement had been reachedwith the local authorities in theabove-mentioned cities to provide logisticsupport to the local Social and EconomicCouncils (office space, minimumequipment, etc.).

A network of local Social and Economiccouncils will be introduced on the sameprinciples as the Social and EconomicCouncil at the national level.

Councils will work together withrepresentatives of local authorities, localtrade unions and employers on the paritybase.

Social and Economic Councils at the locallevel would form working groups for theprotection of labour and social rights in theprivatisation process, and working groupfor labour legislation. Later on, they wouldform other groups as well, for example onissues of occupational safety and health,environment and working site protection,social policy in the process of transition.10

45

5. LEVELS OF SOCIAL DIALOGUE


9 Ibid., p. 28.

10 NationalReport of Serbia, p. 31.

In the case of Croatia too, by theagreement between the government,representative trade unions and employers’organisations with the aim of establishingsocial dialogue at different levels, theestablishment of social and economiccouncils at the local levels is set forth as anon-compulsory option. In other words, thesocial and economic councils at the locallevel are founded in accordance with theAnnex of Agreemant on Establishing SocialEconomic Council, signed by thegovernment, five trade unionconfederations and employers’associations, as described in the nationalreport of Croatia:

According to the mentioned Agreement,with the aim of establishing and developingtripartite dialogue at other levels ofgovernment system, possibility is providedfor the founding of economic and socialcouncils in the units of local administrationand self-government. Such councils arefounded by the leadership of these units,trade union centres whose representationhas been established by the law at thenational level and the competent body ofthe employers’ association at the higherlevel. These bodies, among other powers,monitor, study and evaluate the impact ofthe local/regional community, fiscal, socialand economic policies on the population’seconomic and social security, developmentand living standard at the respective level.

Until 1 May 2002, social and economiccouncils have been founded in 11 (out of21) counties.11

Observing in general the levels at whichsocial dialogue is established in

south-eastern European countries, we cannote a logical sequence; namely, it islogical that mechanisms of social dialoguehave been first established at the levelwhere the greatest social power – the keycontrols of authority and decision-making –are concentrated.

This can be used as an advantage, as afirm foothold in the process of establishingsocial dialogue mechanisms at otherlevels. It is indisputable, which theexperience of these countries alreadyconfirms, that social and economic councilsat the national level can play an importantrole in encouraging and coordinating thedevelopment of social dialogue at the locallevel. However, care should be taken toavoid the centralisation of social dialogue,that is, to prevent social and economiccouncils at the national level frombecoming an umbrella over social andeconomic councils at the local level.

The development of social dialogue at thelocal level, as it has been demonstrated,depends on the development of the subjectof their work, that is, on the degree of realpower and authority of governmentalinstitutions at the local level. This impliesthat the very development of a socialdialogue mechanism must be treated aspart of the strategy of the development oflocal communities. This is also thecondition ensuring that the network ofinstitutions of social dialogue at differentlevels is established in a systematic waythat will make it possible for creativepotential to be manifested in different areasof life and levels of political organisation ofsociety and that free citisens can create theconditions of their life.


46


6. PARTICIPANTS IN SOCIAL

DIALOGUE

The nature of social dialogue actuallydetermines its participants. These includethe government, employers (employers’organisations) and trade unions, which arethe main actors in industrial relations as awhole.

This seems so pure and simple, but only atfirst glance. It is in the area of definition ofparticipants in social dialogue that weencounter many disagreements, conflicts,doubts, etc. This is one of the pronouncedproblems and major obstacles in theprocess of establishing and developingsocial dialogue mechanisms, since a cleardefinition of the participants is the first stepand condition for the establishment ofsocial dialogue. This follows from the factthat the development and objective reachof this process largely depends on itsparticipants and the concentration of powerbetween them. Participants in socialdialogue are in a contradictory position.They share minimum common interests forwhich they enter into social dialogue.These common interests are also thegroundwork of the principles underlyingsocial dialogue – voluntariness, autonomy

of will and good faith, that is, mutualconfidence between the participants. At thesame time, social dialogue actors havetheir own particular interests, oftenopposing and representing a source ofconflict between them. Of course, each ofthe actors attempts to promote and achieveits interests to the maximum extent. In thisregard, each of the participants isinterested in exerting as much influence aspossible on the other participants, even onthe choice of participants in socialdialogue.

The starting point for a clear andcomprehensive definition of legal andlegitimate actors in social dialogue is theconstitutional legal and actual protection offreedom of organisation and action ofworkers’ and employers’ organisations. It isobvious that where this freedom is notformally, legally and actually protected,there can be no partnership or socialdialogue. In this regard it can be stated thatin all observed countries of south-easternEurope this formal legal condition isfulfilled, since all of them have ratified ILOConventions 87 and 98 and incorporated

47

6

provisions on freedom of organisation andaction of temployers’ and trade unionorganisations in their constitutions andlaws. Nevertheless, violation of theserights, particularly of trade union rights, ispresent in practice in all these countries toa greater or lesser extent. Thisautomatically places trade unions, asparticipants in social dialogue, in an inferiorposition in relation to the other twoparticipants in this process. Of course, anyaction that threatens or restricts thefreedom of organisation and action ofworkers’ and employers’ organisationsdirectly threatens the establishment ofsocial dialogue, introducing anelement ofmistrust into their mutual relations. Havingtaken note of this, all the analysedcountries have stipulated that social andeconomic councils, inter alia, should reviewany cases of violation of the freedom oforganisation and undertake measureswithin their competence or proposerelevant measures to governmental bodiesand social partners.

According to the views presented in thenational reports, the state is a specificparticipant in social dialogue. In theestablishment and development of thisimportant segment of democratic socialorder it plays a double role. On the onehand, the state creates the constitutionaland legal basis and the entire socialenvironment for the establishment anddevelopment of social dialogue.

At the same time, the state (i.e. itsrepresentative – the government) togetherwith the other two actors – employers andemployees – participates as an equalpartner in the discussion of issues that fallwithin the scope of work of the social andeconomic council.

The state is objectively the most powerfulactor in social dialogue, because it holds allthe controls of political power. Thecontradiction of its position and role insocial dialogue is actually reflected in thefact that through the development of socialdialogue and other democraticmechanisms it should transfer some of itspowers to civil society. In this respect, thestate has the power to influence theprocess of the establishment and

development of social dialogue in apositive or negative way andcommensurately with its formal power itbears a share of responsibility for the stateof social dialogue.

Positions presented in national reports alsogive rise to the conclusion that the state isobjectively the most influential actor insocial dialogue. In the initial phases,particularly if the other two actors – tradeunions and employers – are very weak, thiscan turn into an advantage, of course,provided the government demonstratesreal political will to establish and developsocial dialogue. But if such a situationremains permanent, it would be disastrousfor the essence of social dialogue.

Political power, that is, authority possessedby the government, as its input variable inthe process of developing social dialogueimplies that the course and results of theprocess largely depend on which politicalforces are in power. This is, among otherthings, confirmed by the experience ofBulgaria, where the influence of politicalprogramme orientation and concentrationof power on the political scene on thedevelopment of social dialogue wasobvious. The following is what the nationalreport of Bulgaria says on this issue:

In the recent decade there has been aparticular trend in practice, which has hadfew exceptions. Governments that couldrely on a more or less stable parliamentarysupport preferred the ‘power monologue’,while governments that were elected by afluctuating majority, or that weretransitional or provisional showed as a rulea greater tendency to conduct socialdialogue. In it they sought (and in mostcases found) a factor that enhanced theirpolitical stability, a relatively calm publicenvironment and a specific ‘warranty’ forthe changes they implemented in theeconomic and social spheres. Thus, forexample, the behavior of the governmentsof the Union of Democratic Forces (UDF) in1991/92 and the Democratic Left in1995/97 included attempts to significantlyrestrict the contents and the mechanismsfor social partnership (including actions forfinancial destabilisation of the largest tradeunion) and to nationalise the social


48

partners again. Conversely, the interimcoalition government in 1990/91, appointedin practice with parliamentary consent, aswell as the provisional governmentsappointed in 1994 and 1997, had no stablepolitical support, but (or, maybe because ofthat) were much more focused on andopen to having a social dialogue.

Simultaneously, changes in the positions ofthis or that government, in the support theygot from the Parliament (as well as fromthe economic structures) led to changes intheir behavior to the social partners. Thus,for example, the 1992/94 government,appointed by a ‘dynamic’ parliamentarymajority, demonstrated at first openness tosocial dialogue, to even collaborate on itsfull institutionalisation. However, in thesecond year of its mandate, when thesupporting majority seemed more stablethan in the beginning, it changed itsattitude to social partnership with atendency to restrict it.

The attitude of the 1997–2000 UnitedDemocratic Forces (UDF) government,appointed by a stable majority, towardspartners and above all towards tradeunions was complex and contradictory.There was, on the one hand, tendency tocollaborate, determined by the hardcircumstances in the country in 1997 andby the clear intention of that government tostart at long last radical reforms thatrequired solid public support. For thesereasons, the position of the governmentalternated between a clearly expresseddemocratic will for dialogue and a strivingto pacify the trade unions by makingcertain concessions. On the other hand,there were also tendencies to formaliseand depreciate the social dialogue,attempts to circumvent or even neglecttrade unions’ opinions at times. This wasprimarily manifested by underestimatingthe role of the National Council forTripartite Cooperation, by underratingpartnership in industries and branches, aswell as by ignoring some of the specialtripartite structures at the national level –for example, the National Council forProtection in Cases of Unemploymentand Promotion of Employment amongothers.

Besides that, we can generalise (with therelativity inherent to every generalisation)that the development of the social dialogueunder each government takes the shape ofa peculiar sinusoid. It goes from quicklyreached maximum values (usually in thebeginning of the mandate) to a decline(with a more stable parliamentary majoritysupporting the government that it hasappointed), again (eventually) to anincrease in the intensity of the dialogue incases of lower parliamentary support,emergence of social tensions, or in need ofsupport for unpopular economic and socialmeasures.12

A special case that deserves to bementioned is the experience of Kosovo,that is, the role of political authorities andorgans of international community in theprocess of establishing social dialogue.That is particularly important because ofthe problems faced by these bodies, suchas child labour or fight againstdiscrimination, which must be continuouslyon the agenda of social dialogue. Thenational report of Kosovo highlights thismatter:

The state’s role to determine ‘fair playrules’ for labour market is significant.National and international trade unions, aswell as employers through theirorganisation – Chamber of Commerceexercised continuos pressure over theUNMIK to adopt the Labour Lawconvenient for the circumstances inKosovo. What the applicable law offered in1984 is far away from what is needed nowbecause of the political and economicclimate completely different from the one atthe time of adoption.

Enactment of the legislation on labour isnecessary to define the relations,employees’ rights, child labour,anti-discriminatory practices, etc.

UNMIK’s Department of Labour andEmployment in cooperation with localexperts drafted the Fundamental LabourLaw establishing basic labour andemployment rules in Kosovo. In this way itis possible to clarify many issues such asminimum age to work, the right to collective

49

6. PARTICIPANTS IN SOCIAL DIALOGUE

12 National Report of Bulgaria, pp. 6-7.

bargaining, labour relations, labourcontracts, minimum wage, etc.

Areas that are not covered by labour lawshall be covered by collectiveagreements.13

This example is highly important, becauseit points to the significance that the bodiesof international community attach todemocratic changes and development ofsocial dialogue as important instrumentsfor the solution of the crisis in this area.

The national report of Romania stressesthe following functions of the state in socialdialogue, and particularly its specific role inrelation to the employees in sectorsfinanced from the budget:

With regard to the present evolution of theindustrial relations in Romania, the stateplays three parts:

a) to promote the legal acts regulating thesocial dialogue, the functioning andorganisation of the trade unions,employers, tripartite institutions andbipartite cooperation. For this purpose,Government Decision 314/2001 on theestablishment, organisation andfunctioning of the social dialoguecommissions within some ministries andprefectures, Government Decision356/3001, the Employers’ Law andother similar legal acts have beenadopted;

b) To consult the social partners on theeconomic and social problems raised atthe different levels of the economy: atlocal, branch and national level;

c) to try to find out solutions for theimplementation of the social andeconomic policies objectives, togetherwith the social partners;

In 2002 the Government still has theprerogatives of an employer as a greatdeal of the employees are employed in thebudgetary system as well as in the régies

autonomes or majority state-ownedenterprises. This reality is mirrored in thenecessity of an active involvement of theGovernment in the relationship with the

trade unions by assuming to a great extentthe employers’ role.

The support granted by the Government,through the Ministry for Labour and SocialSolidarity, to the promotion anddevelopment of the social dialogue willhave to become a current performance andan essential objective beside the otherobjectives related to Romania’s economicand social evolution in the followingyears.14

The national report of FYROM stresses thedominant role of the state in all currentsocial processes, including social dialogue.Particularly emphasised are the ministrieswhere the dominant decision-makingpower over these issues is concentrated,including those that are the subject ofsocial dialogue:

The state has dominant role in FYROM.Decision-making process is concentratedin a small nucleus of ministries that governthe reform formulation and implementation.

The Ministry of Finance is responsible forthe implementation of the fiscal policy,including the budget preparation. Incooperation with the National Bank itmonitors international financial activities ofthe country. The Ministry is responsible forthe creation and implementation ofmacro-economic and development policy ofthe Government and for deciding upon thepriorities in the area of public investments.

The Ministry of Economy is responsible forthe regulation and intervention of thedomain of economic activities, including thepolicy of support to small andmedium-sized enterprises. The Ministryalso monitors the economic, structural andtechnological situation in the economy.

The Ministry of Labour and Social Affairsperforms activities relating to theemployment; pension and disabilityinsurance, safety at work; material supportfor temporarily unemployed; salaries andliving standard; social policy and humanpopulation policy in order to achieveharmonic economic-social development.


50

13 National Report of Kosovo, p. 9.


The Ministry of Education and Scienceperforms activities that refer to educationon all levels and types; organisation,financing, development and improvementof education and science; verification of thevocations and profiles in education;technology development, informationtechnology and technical culture; andinternational-technical cooperation.15

Finally, the experience of Montenegro isalso characteristic, because the nationalreport highlights the limitations faced by thestate, that is, political authorities inexercising its role in social dialogue.

The Government of Montenegro isseriously committed to the implementationof numerous reforms necessary to conformthe country to the standard of otherEuropean countries. This is particularly trueof the reform of the labour market, socialinsurance, etc.:

In the area of social dialogue theGovernment of Montenegro is facingnumerous difficulties:

1. The stability of the Government and itspolicy is directly dependent on thecoalition of parties, which does notleave enough room for trulyindependent action. As the result,political dialogue very often substitutesthe social dialogue;

2. In any case, real social dialogue isdetermined by the fact that the othertwo traditional partners, trade union andthe employers’ association, are veryweak by European standards;

3. Since most enterprises are still in publicownership, sometimes these two roles(of the entrepreneur and the third party)overlap;

4. The government budget is very rigidand cannot provide necessaryresources for the change of society.Due to this, teachers on strike for fourmonths now have very slim chances ofachieving the salary increase;

5. Difficult economic situation imposes theunpopular option – reduction ofseverance pay to redundant workersfrom 24 to 6 monthly wages, asproposed by the IMF.16

6. When the role of state in social dialogueis concerned, a very characteristicexperience is that of Albania, where theMinistry of Labour and Social Affairswas founded in 1992, and its functionsand tasks defined in the following way:The Ministry of Labour and SocialAffairs (MLSA) was created in 1992 andlater, in 1993, the Department of LabourRelations was created within thisministry, which came out as a necessityfor managing labour (industrial)relations in the new labour market. Itsmain mission is the promotion of politicsin labour relations, the enhancementand development of social dialogue inthe framework of partnership and thepromotion of international labourstandards.

The objective of this Department is thedevelopment of labour legislation through:

� the improvement of necessary legalframework;

� the development of new work relationsamong the state, employers and tradeunions, on the basis of legislation inforce and the ratified internationallabour conventions;

� the development and consolidation ofpartnership institutions for the purposeof preserving social equilibrium viaharmonising the parties’ interests, etc.17

As for the participation of trade unions insocial dialogue, differences are visibleprimarily in the number of trade unionsparticipating in this process, that is,whether one or more trade unions areinvolved in social dialogue. This is shownin Table 3.

51


15 National Report of Macedonia, p. 3.

16 National Report of Montenegro, p. 13.

17 National Report of Albania, pp. 8–9.


Table 3. Number of trade unions

participating in social dialogue at the

national level

Country

Number of trade

unions participating

in social dialogue

Albania 4

Bosnia andHerzegovina

1

Bulgaria 2

Croatia 5

Kosovo 1

FYROM 2

Montenegro 1

Republika Srpska 1

Romania 5

Serbia 3

In half of the observed countries there isonly one trade union participating in socialdialogue, while Romania and Croatia havethe highest number of trade unionsinvolved – five each.

Of course, the number of trade unionsparticipating in social dialogue depends onthe specific course of development of thetrade-union movement and in this context –trade-union pluralism in certain countries. Itis also necessary to be aware that thenumber of trade unions in all the analysedcountries is higher, but only the number oftrade unions mentioned above take part insocial dialogue. Therefore, the situation inthis regard may change in the future.

All the countries where more than onetrade union takes part in social dialogueapply the principle of trade unionrepresentation, which is, as a rule, definedby law. However, this process is notcomplete in all the countries of the region.For example, the Labour Law of theRepublic of Serbia introduced the principleof trade unions’ representation and setforth the conditions that a trade union mustfulfil at a certain level to be consideredrepresentative. However, the actualprocess of determining the representationof trade unions has not yet beencompleted. This process takes placesporadically in certain enterprises andbranches, at the initiative of the tradeunion, but not at the national level.

The next problem faced by trade unions associal dialogue actors refers to division,fragmentation on the trade-union scene,rivalries and conflicts. This can be jointlytermed as unnecessary and unfaircompetition between trade unions. Ofcourse, this weakens the overall position ofthe trade union in social dialogue andgenerally produces an adverse effect onthe establishment and development ofsocial dialogue.

The complexity and far-reachingconsequences of this process aredescribed in the very specific,comprehensive report on Croatia:

Relations between [some] trade unioncentres are marked by strong rivalry.According to the assessment of one of thetrade union leaders, such relations arisefrom the fact that ‘all four trade unioncentres aim at the same target groups –workers in the economy’. However, due tothe declining employment, the number oftrade union members in the economy isdecreasing.

The struggle for trade union membership(in the conditions of stagnation andshrinking of the target market) results in theemergence of different forms of unfair tradeunion competition:

� ‘Trade union dumping’. This is thepractice of certain trade unions whichbase their ‘competitive advantage’ onthe (low) ‘price of trade union service’.In other words, membership is attractedby offering lower union dues.

� ‘Trade union demagogy’. In this case,the practice is to leave the bulk of thecollected union dues to the trade unionlocal in the enterprise. According toavailable information, trade union localsin enterprises usually retain between40% and 90% of the collected uniondues at their disposal. From theseresources they finance purchase ofgoods (mainly food) for satisfying thebasic needs and thus, in fact, purchasesocial peace. The demagogic dimensionof this practice follows from the fact thatthis is non-purposeful expenditure ofresources. This serves to mitigate theconsequences, but does not eliminatethe causes which generate low level ofworkers’ labour and social rights.

52

� ‘Takeover’ of trade union organisations.Takeover of trade union organisations iscarried out in two ways. In the first case,shop stewards decide on behalf of themembership to transfer into anothertrade union or to a trade unionassociation at higher level (often failingto inform the membership of thisdecision). There is no need to point outhow this practice is in discrepancy withthe ILO Convention 87 about tradeunion freedoms and the protection oftrade union rights. In the second case,the decision on transfer is made by themembership. Pointing to the examplesof such behaviour, one trade unionleader described situations in whichtrade union members make the decisionto transfer into another trade unionliterally because of a ‘case of wine, aChristmas turkey or an Easter ham’!

Other sources of conflict between tradeunions are:

� unsettled issue of division of trade unionproperty. It has already been mentionedthat the Confederation of AutonomousTrade Unions of Croatia (SSSH), as thelegal successor, has taken over most ofthe property of the ‘old’ trade union,while a part is in other trade unioncentres or independent trade unions.The SSSH does not object to thedivision of property (an inter-unionagreement to this effect has beensigned two years ago, at the initiative ofthe SSSH), but the problem is thedefinition of criteria for division.However, for the full information on thisproblem it is necessary to say that bythe Law on Associations (1997) and bythe new Law on Associations (1January 2002), trade union propertywas transferred to the state – hence, itwas nationalised. Reacting to this, backin 1998 the SSSH filed a complaint withthe ILO, pointing to the violation ofArticle 3 of the Convention 87 (see theReport of the 89th Conference of theInternational Labour Organisation,Geneva, 5 June 2001).

A meeting with the representatives of alltrade union centres was held on 5December 2001 in the Government ofthe Republic of Croatia, where it wasagreed that the same inter-unionagreement of 1999 should be updatedor a revised version drawn up accordingto which the Government will by itsruling return the property to tradeunions. This process is under way.

� personal ambitions of top officials intrade union associations. Assuming topposition in a trade union, particularly inview of profound economic crisis,became attractive. Tendency towardsaccomplishing personal ambitionsrepresents one of the major motiveforces for initiating the creation of newtrade unions and fragmentation of tradeunion scene in Croatia.18

Successful and efficient participation oftrade unions in social dialogue requiresthat they achieve minimum mutualagreement on the development strategy,goals to be achieved in social dialogue andthe manner in which these goals are to beachieved. The prior condition for this isminimum trade-union solidarity and jointaction in the defence of the minimum jointinterests of all employees.

When employers’ organisations as socialdialogue actors are concerned, thesituation is even more complex than it is incase of trade unions. Apparent here is thecrossroads of the old and the new. This isreflected in the fact that in some countrieschambers of commerce and industryappear as participants in social dialogue.This is the legacy of the socialist,single-party system, since theseorganisations cannot be treated asemployers’ organisations based onvoluntary membership. Table 4 illustratesthis and other relevant indicators on thisissue.

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18 National Report of Croatia, pp. 19, 22, 23.

Table 4. Type and number of participants in social dialogue on the part of employers

In four of the ten observed countries,chambers of commerce and industryparticipate in the social dialogue on behalfof employers, which represents one of theelements of the legacy from the formerperiod. Interrelationship, that is, theinfluence of the social environment on sucha situation is shown by the fact that theseare the countries where the transitionprocess is proceeding at the slowest pace.The same refers to privatisation, as one ofthe key elements of this process. It is truethat the content and method of their workchanged to some extent under the impactof the entire course of changes. However,chambers of commerce and industryobviously cannot be authentic employers’representatives in a market economy.These countries are yet to face thechallenge of the establishment ofautonomous employers’ organisations,which is of crucial importance for socialdialogue. The example of Bulgaria showsthat this is possible. In that country theChamber of Commerce and Industry wastransformed into anemployers’ organisationbased on new groundwork, as described inthe national report of Bulgaria:

According to the same criteria, fouremployers’ organisations wereacknowledged as representative:

� The Bulgarian Chamber of Commerceand Industry (BCCI). It was firstestablished about 120 years ago (in1884) and after 1992 defines itself as avoluntary, public organisation for

assisting, promoting, representing andprotecting the economic interests of itsclients of the public and the privatesector.

� The Bulgarian Industrial Association(BIA), founded in 1980, is a voluntary,non-govermment organisation of theBulgarian business and industry. It isthe successor of the Bulgarian IndustrialChamber established in 1880.BIA is a non-profit organisation,incorporating legal entities and physicalpersons conducting business activity inthe field of the private, public,co-operative and municipal sectors ofeconomy.BIA protects and co-ordinates theinterests of the employers on thenational, industrial, regional, sector andsubsector levels trough the branch(sector) and regional organisations ofthe employers – BIA members.

� Association for Grassroots Enterprises(renamed in 2001 the Civil Associationfor Enterprises). It was set up in 1989as the first organisation of privateentrepreneurs for protecting thefreedoms of enterprises and privateemployers.

� The Vazrajdane Bulgarian Associationof Private Entrepreneurs established in1989.19

In this connection it is worth pointing outthat positive processes in the area of theestablishment and development ofindependent employers’ associations areunder way, with certain NGOs assuming


54

Country Participating organisation Number of participants

Albania Employers’ organisation 2

Bosnia and Herzegovina Employers’ organisation 1

Bulgaria Employers’ organisation 4

Croatia Employers’ organisation 1

Kosovo Chamber of commerce and industry 1

FYROM Chamber of commerce and industry 1

Montenegro Chamber of commerce and industry 1

Republika Srpska Chamber of commerce and industry 1

Romania Employers’ organisation 8

Serbia Employers’ organisation 1


the role of initiators. There are two suchorganisations in Montenegro:

Entrepreneurship, Management,

Business (PMB)

Founded as a foundation in 1999 after thefailed attempt to register it as anindependent chamber of commerce andindustry. In addition to legal problems,financial aspect was involved too, becausemembership in the official Chamber ofCommerce and Industry is compulsory,entailing the payment of membership fee.Consequently, enterprises wishing to jointhe alternative chamber would have to paytwice.

The foundation was founded with the ideato create favourable institutional frameworkfor enterprises, lobbying in the interest ofmembership, organisation of training andseminars, such as the one about shadoweconomy in Montenegro, with theparticipation of many ministers.

With about 100 enterprises which employabout 2,000 workers, at the end of 2001the foundation was a truly representativeorganisation of Montenegrin business.

The Employers’ Association of

Montenegro (UPCG)

This is an umbrella organisation founded inSeptember 2001 and registered as anon-governmental organisation. It has 30members, encompassing 10 sectorbusiness associations, individualbusinesses, foreign investors andinternational companies.

It has an 11-member Management Boardand is organised in six workingcommissions:

1. Education and research2. Membership3. Publishing policy4. Communications5. International relations6. Finances.

One of the first activities of the associationwas organisation of a visit to Kosovo in

April 2002, with the participation of some30 businessman from Montenegro. Themain aim of this meeting entitled ‘Businessfor business’ was to provide a uniqueopportunity to the participants to meet withenterprises in the same line of activity andto investigate the possibilities of theKosovo market.

The association also operates the Centrefor Business and Economic Development,which is the first consultative centre inMontenegro which supports businessesand economic development.

The main services offered by this Centreare:

1. Research, economic surveys anddevelopment of a database on SMEs;

2. Policy analysis and recommendations;3. Business consulting services;4. Preparation of business plans for

entrepreneurs;5. Primary and advanced training for

newly-founded and existing firms;6. Support to women–entrepreneurs; and7. Publishing activity.20

As in the process of transition in general,the state may play a positive andencouraging role in the establishment ofindependent employers’ organisations, asan irreplaceable factor of market economyand social dialogue. That is very concretelyconfirmed by the experience of Albania,where the Ministry of Labour in 1995launched the following initiative:

In Albania, the first initiative was taken in1993, when a group of new, privateentrepreneurs founded the Union ofDemocratic Businessmen. Thisassociation, having no experience and/orforeign assistance, could not be properlystructured and take attributes of a reallyrepresentative organisation.

The second initiative originated from theMinistry of Labour in the early 1995,obviously more under the pressure andassistance of the ILO for completing thescheme of social partners, rather than as atrue initiative from business community.However, the result of this initiative –

55


20 National Report of Montenegro, pp. 11–12.

CONBIZ – entered into the partnershipscheme and benefited from the ILOassistance together with the state andtrade union partners. Under suchcircumstances, in June 1995, the firstself-initiative was taken by the mostmodest community, the small andmedium-sized businesses, which broughtinto existence the foundation of theConfederation of Small and Medium-SizedEnterprises (CONFINCOM).21

In FYROM there is an organisedEmployer’s Organisation, which functionsas a particular form of voluntaryorganisation of employers, for organisedpresentation of the interests of employersand especially in the social partnership withthe institutions of the system, workers’organisations and other institutions andoprganisations in the country and abroad.

At the start of the establishment of theprincipals of a market economy thisorganising of employers began through thecouncil board of employers at the Chamberof Commerce level, with specialcommittees on branch organisations. Thiscouncil was established in 1991.

Starting with the needs of finding anappropriate form of organising employers,through which all their enquiries andinterests would be realised, the Council ofEmployers made a decision on 3 March1994 to transform itself into an employers’organisation in the form of a voluntaryorganisation with an executive board and apresident.

The results of the comparative analysis inthis segment point out that the process ofconstitution of the actors oin socialdialogue is still under way. This primarilyrefers to trade unions and employers’organisations and involves the settlementof relations on both the trade union andemployers’ scene. It is obvious that each ofthe two actors ointhe social dialogue isoften confronted within its own group, thattrade unions and employers’ organisationsgreatly differ by the size, organisationalstructure and logistic facilities.

Adequate changes in this area must focuson a clear definition and strengthening ofthe social power of each of the actors,because a relative balance of powerbetween them is a prerequisite for thefunctioning of social dialogue.


56

21 National Report of Albania, p. 7.

7. THE ORGANISATIONAL

STRUCTURE OF SOCIAL

DIALOGUE

The establishment and development ofsocial dialogue in south-eastern Europeancountries besides its political and socialaspect, has,an organisational aspect. Inother words, organs and bodies withinwhich social dialogue takes place may beregarded as an organisational system. Likeany other social and political activity, thesuccess of social dialogue depends onorganisational structure.

Organisational structure should enable theexercising of the main functions of socialdialogue, reconciliation of social partners’different interests, prevention of industrialand social conflicts, and if theynevertheless break out – their peacefulresolution, as well as permanent,systematic influence of unionised labourand civil institutions on the creation of astrategy of social, economic and politicaldevelopment of society.

An organisational model should also bebased on the fundamental principles ofsocial dialogue – voluntariness, theautonomous will of the parties and mutualconfidence.

Likewise, the organisational structuredirectly and openly expresses the attitudeof the key actors in social dialogue towardsthis important social process. Of course,organisational structure is more developedin those countries where more attention ispaid to social dialogue and where socialdialogue has become an important elementof social decision-making. This simplyarises from the fact that the development ofsocial dialogue imposes the need for theintroduction of new, and the upgrading ofold, organisational forms. Organisationalstructure of social dialogue also reflects thedistribution of power among its actors,because each actor could attempt toimpose the organisational concept thatwould enable it to have the greatestinfluence on the organs and bodies wheresocial dialogue is conducted. In this regard,we may say that the very organisation ofthese organs and bodies represents thesubject of social dialogue between socialpartners.

The basis for such a claim is provided bythe fact that the organisational structure ofthe organs wherein social dialogue is

57

conducted is determined by the agreementof social partners and that it is in fact theirfirst agreement, which represents a test oftheir real readiness to earnestly establishand develop social dialogue. Also, thementioned agreements set forth that theorganisational structure and method ofwork of the social and economic councilsmay be changed pursuant to theagreement of all participants, wherebyeach of them individually may launch suchan initiative. This approach is veryimportant, because if they fail to agreeupon the method of organisation and workin their mutual relations within the socialand economic councils, it cannot berealistically expected that the actors insocial dialogue would agree upon the otherissues on which they should build theircommon stands.

In addition to all the above-mentioned, theorganisational structure of the social andeconomic councils should ensure theirefficient working, monitoring the executionof their positions and decisions, as well asthe cost-effectiveness of their work in theexpenditure of financial and materialresources.

The situation is different in the countrieswhere the establishment, scope of work,organisation and working methods of thesocial and economic councils are legallyregulated. In this regard, the founding ofthe social and economic councils by theagreement of social partners has certainadvantages. In that case, all three socialpartners are in a relatively equal position,because the organisational structurecannot be defined or the work of thecouncil started without the agreement of allsocial partners. This is even morepronounced than in the subsequentprocess of decision-making at the sessionsof the social and economic councils,wheredecisions in most cases are made bymajority vote.

In situations where the founding,organisation and working methods of thecouncil are legally defined, the state, as thelegislator, enjoys a considerable initialadvantage. Of course, it is implied that thelegislation governing the organisation andwork of the social and economic councils is

enacted in a democratic way, with activeparticipation and agreement of the othertwo social partners. This arises from theprinciple of voluntariness, meaning that noone can force anyone else to participate insocial dialogue. Actually, they can, but thenit would not be social dialogue.

The internal organisation and workingmethod of the organs and bodies whereinsocial dialogue is conducted are largelycomplementary with the legal framework.Due to this, the analysis of theorganisational structure, its positive sidesand shortcomings should also alwaysinclude the elements of the legalgroundwork underlying that organisationalstructure.

The tripartite structure actually determinesthe composition of the social and economiccouncils. They are composed of therepresentatives of government, employersand trade unions.

However, besides the above-mentionedprincipal actors in social dialogue, there areother actors involved in the work of thecouncils. A characteristic example in thisregard is offered by Montenegro, where thework of the council at the national levelincludes 21 representatives of employers,trade unions and government (seven fromeach organisation) and as many as 17representatives of civil society – NGOs,farmers, universities, emigrants.

The idea and initiative to formally includeNGOs and representatives of civil societyin the work of social and economic councilshas also been contemplated in othercountries. However, practical solutionshave not yet been found. Two types ofobstacles are emphasised in thisconnection in the national reports – limitedresources and real power to influencesocial reforms, as well as large number ofNGOs and, owing to this, difficulties aboutthe choice of those to represent the NGOsector in the social and economic councils.The first problem is discussed in thenational report of Montenegro.

In June 1994 the Assembly of Montenegroadopted the Law on Non-GovernmentOrganisations, which enables


58

non-government associations orfoundations to acquire the status of legalentities on the basis of registration.

Foreign non-government organisationsmay operate on the territory of Montenegroif registered with the Ministry of Justice.

This law does not refer to politicalorganisations, religious communities, tradeunions, sports organisations, employers’associations, associations or foundationsfounded by the government or thosefounded according to special laws.

About 100 organisations are registered asNGOs, but most of them have limitedscope, structure and resources. Theirinfluence on the reforms of Montenegrinsociety is accordingly restricted.

The minister of labour assesses that onlyabout 20 NGOs may play that role.

An example that can be mentioned is theWomen’s Action. This is a non-governmentorganisation registered in 1999 with thefollowing goals:

� equal rights and obligations of men andwomen;

� promotion of women’s position insociety;

� strengthening of women’s position inpolitics;

� legal protection of women;� upgrading of social services necessary

to a family.

The Women’s Action is affiliated with theWomen’s Network, which gathers similarorganisations from Bosnia andHerzegovina, Croatia and Slovenia.

This non-government organisation is alsoan active member of the working group forgender issues within the Stability Pact.22

The other aspect of the problem isdiscussed in the national report of Serbia,which stresses:

There are 19,129 registered NGOs inSerbia. Most of these organisations were

founded before 1990, and some 3,000were founded during the Milosevic regime.A great number of NGOs – 2,800 werefounded after democratic changes tookplace in Serbia. Most of them, according totheir structure, adeal with issues such as:development of civil society (23%), socialservices (14%), environmental protection(12%), youth (5%), culture (5%), students’issues (4%), education (3.5%), health(3.5%), multi-ethnic tolerance andmulti-ethnic society development (3%),protection of cultural heritage and tradition(3%), fostering of entrepreneurship (2.4%),local community development (2%),peace-building (1.5%) and maintainingcooperation with other countries, especiallywith the European Union (1.4%).

NGOs may be divided into four basicgroups depending on a manner in whichthey provide assistance: access to therights and legal help; material and medicalhelp; education and training; andpsychological support and counselling.23

In any case, the number of NGOs mayproduce positive effect on the developmentof democratic initiatives and expression ofthe creative powers and initiatives ofindividuals and social groups. However, theabove-mentioned problem objectivelyexists. This problem is handled much moreeasily at the local level, because there arefewer NGOs and it is easier to recognisetheir specific role and real capacity.

The number of members of the social andeconomic councils at the national leveldiffers from one country to another and isdetermined by the specific features of thesocial dialogue establishment process, thenumber of representative participants insocial dialogue, as well as certainconceptual differences on the issue ofwhich organisations may participateequally in the work of social and economiccouncils. The number of members of thecouncil also expresses the organisationalapproach of the actors in social dialogue tothe provision of an optimal number ofmembers that would enable efficient work.However, this can be a two-edgedsword.

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7. THE ORGANISATIONAL STRUCTURE OF SOCIAL DIALOGUE

22 National report of Montenegro, pp. 13–14.

23 National Report of Serbia, p. 13.

Of course, too great a number of councilmembers could be counter-productive forefficient operation and rapid convening,and may increase operating costs.However, a reduction of the number ofcouncil members below a certain limit forthe sake of efficiency and economy couldcause irreparable damage by excludingpotentially relevant participants from thework of the councils and put at risk themain goals of their existence. To provide acomprehensive review of this problem, thedata in Table 5 indicate the number ofmembers of social and economic councilsat the national level in the studiedcountries.

Table 5. Number of members of social

and economic councils at the national

level

CountryNumber of

members

Albania

Bosnia andHerzegovina

6

Bulgaria

Croatia 15

Kosovo 15

FYROM 11

Montenegro 38

Republika Srpska 6

Romania 27

Serbia 9

The data in Table 5 provide grounds to theclaims presented above. We should keepin mind that the number of members of thecouncil depends upon the size of thecountry, on the number and relationsbetween the social dialogue actors, effortsof each of them to be adequatelyrepresented in these bodies. It may seemthat the number of members of the socialand economic council is a minor technicalissue, but it is quite certain that the numberof members has a strong impact on thework and functioning of these bodies. Forexample, the exceptionally small number ofmembers of the social and economiccouncils in some of the countries is apotential risk that these bodies may turninto consultative working and meetings ofofficials from the top governmental, trade

union and employers’ organisations, whichis not the purpose of social dialogue.

With the aim of securing an unimpededholding of meetings and efficient work, allthe observed countries have introduced theinstitution of deputy member of the socialand economic council, who can deputisefor members of the council in their absencewith full powers.

Organisational structure in all the countriescovered in this analysis includes certainnumber of representatives of employers,trade unions and political authorities. Thissolution reflects the principle of equality ofsocial partners. However, this solutionfaces trade unions and employers’organisations with a new challenge inthose countries where there are more tradeunions and/or more employers’organisations participating in the work ofthe social and economic councils. Sincethe government has a fixed number ofrepresentatives on the social and economiccouncil, which it does not share withanyone, its starting position is morefavourable compared with that of the othertwo social partners.

This urges trade unions and employers’organisations to reach a consensus on theminimum common interests and strategy inthe work of the council, which is notpossible if they do not have apriorminimum agreement about their mutualrelations and common strategy. First of all,agreement must be reached about thechoice of council members from the tradeunion ranks. Absence of this minimumagreement and cooperation between tradeunions and employers’ organisations notonly weakens their position in relation tothe government, but represents a directobstacle to the development of socialdialogue. In other words, the principlewhereby trade unions and employersprovide an equal number of members onthe social and economic councils inconditions of pluralism in the most directway raises the question of the state andrelations with the trade unions, that is, theemployers’ scene.

It states in the national reports that allparticipants, in accordance with the


60

documents thatregulate this issue, are fullyfree to choose members of the council fromtheir ranks and to make the choiceaccording to their own rules. This is inaccordance with the principles ofvoluntariness and autonomy of will of theparticipants in the social dialogue.

An important factor for the organisationalstructure and method of work of the socialand economic councils is that the foundingact may provide for the possibility ofparticipation of experts, political officialsand prominent public personalities at thesessions of the council, depending on theitems on the agenda. In this regard,FYROM has implemented a specificsolution, because two experts elected bythe social partners are fully fledgedmembers of the council. This approachensures a greater degree of competencewhen discussing issues within the socialand economic council’s field of work aswell as the insight of a wider circle ofcompetent persons into the content andmethod of their work.

Another characteristic solution isencountered in the Agreement on theFounding of the Social and EconomicCouncil of the Republika Srpska, whichstipulates that scientists and expertsattending council sessions shall enjoy thesame rights as council members, whichimplicitly implies a voting right.

Working bodies occupy an important placein the organisational structure and workingmethod of the social and economiccouncils. National reports emphasise thesignificance and the role of these workingbodies for the comprehensive, professionaltreatment of issues within the field of thecouncil’s work, for the involvement of awider circle of experts in the creation ofpositions and decisions of the council. Theimportance of these working bodies isrecognised by the fact that in most of theobserved countries their number and fieldof work are regulated by the documents onthe founding of the social and economiccouncils.

The number and field of work of theseworking bodies differs from country tocountry and depends on the specifics ofthe course of development of the social

dialogue, as well as on the topicality andsignificance of issues dealt with by thesocial and economic councils in certaincountrie , field of work of the councils andthe level of development of social dialoguein general. In order to provide a morecomprehensive insight into this matter, wepresent below a review of working bodiesof the social and economic councils insome of the studied countries.

REPUBLIC OF SERBIA

The Social and Economic Council hasworking groups for the following issues:

� protection of labour and social rights inthe privatisation process,

� labour legislation,� social policy in the process of transition,� protection of the living and working

environment,� occupational health and safety,� collective bargaining.

MONTENEGRO

The Social and Economic Council hasseven commissions for:

� agriculture,� industry and privatisation,� labour and social policy,� the environment,� economy and finances,� transition of society,� international relations.

CROATIA

The Council may set up commissions forcertain issues within the scope of its work.The permanent commissions of the Councilare:

� Commission for Wage Policy and FiscalSystem,

� Commission for Employment and SocialPolicy,

� Commission for Collective Bargaining,� Commission for Privatisation,� Commission for Legislation,

Implementation of Regulations andProtection of Rights,

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� Commission for Public Services,� Commission for International Relations,� Commission for the Budget.24

ROMANIA

The Economic and Social Council structureincludes permanent or temporaryspecialised sections. The permanentsections are:

� Section for Economic Development andRestructuring,

� Section for Privatisation,� Section for Labour Relations and

Conflicts Mediation,� Section for Wage Policy,� Section for Social Protection and

Medical Care,� Section for Education and Research,� Section for the Relationship with

Non-Governmental and InternationalOrganisations,

� Section for Small and Medium-SisedEnterprises,

� Section for Equal Opportunities,� Section for Fiscal Policies.

The permanent or temporary sections ofthe Economic and Social Council have atripartite structure. The sections have ninemembers, with an equal representation ofthe social partners.

The sections analyse the specific issuescorresponding to their activities. Theyforward to the ESC Executive Bureau, andto the Plenary Session, the followingdocuments:

� opinion proposals to regulatory normsissued by bodies having initiated them,

� proposals of suitable settlementmeasures,

� any other relevant proposals followingthe analyses.

Social and economic councils exercisetheir role and functions through individualengagement of their members,engagement of experts, scientific andprofessional institutions, by informing thepublic about their positions and activitiesand vial council sessions.

Documents which regulate the method ofwork of the social and economic councilsvery often regulate certain formalprocedures referring to relations, forms anddynamic of work of the social partners inthe aim of securing greater efficiency intheir work. Characteristic in this regard isthe example of Albania, where socialpartners agreed on the following forms ofcooperation:

Social partners have articulated theirrequirements for dialogue with thegovernment and concrete realisation oftripartite principle with clear demands suchas:

� When the government wishes topropose laws or take decisions insocial-economic areas, it has to callupon partners for consultation.

� The institutionalisation of the NationalLabour Conference (once a year) wherethe most important social and economicdecisions shall be taken. TheConference is headed by the primeminister.

� Periodic meetings: premier – socialpartners.

� Periodic meetings on specific issues:ministers – social partners. Theministers maintain constant contactswith social partners on social andeconomic problems within theircompetences.

The development of social dialogue amongpartners at all levels should be continuousregarding problems of their specificinterests, hence concluding agreementsand collective bargaining.25

Also interesting is the experience ofRomania, where relevant documentsstipulate two levels of the work of the socialand economic council, as described in thenational report of this country:

The social dialogue in the ESC has twolevels: a technical one, within theSpecialised Sections, between tradeunions’, employers’ and governmentexperts and independent expertspermanently hired at the TechnicalSecretarial of the ESC, and the other one

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24 Agreement on the Founding of the Social and Economic Council of Croatia, pp. 3–4.


at the decision-making level – in Plenum,and in the Executive Bureau of the ESC.26

It is evident from the national reports thatthe method of work of the social andeconomic councils, and particularly the roleand influence of the representatives ofemployers’ and trade union organisations,are affected by the government’s practiceof rushing through laws and makingdecisions that require prior opinion of thecouncil under the so-called emergencyprocedure, justifying this with a variety ofreasons. This prevents the trade union andemployers’ organisations, which do nothave the necessary material and humanresources, to prepare their positions oncertain issues, with prior consultation oftheir membership.

Documents on the work of the social andeconomic councils and national reportsreveal the practice of setting up thesecretariat of the council, as an operationaland executive body, composed of one ortwo representatives of each of the socialpartners. The task of the secretariat is toprepare sessions of the council and takecare of the execution of its positions anddecisions. Such an executive body cancontribute to the efficient work of thecouncil. However, it is important to makesure that key information anddecision-making powers do not shift to thissecretariat.

Positions and decisions of the social andeconomic councils are made in one of thefollowing ways:

� by consensus,� by majority vote,� by a combination of consensus and

majority vote, where the majority vote isused as a reserve alternative in case adecision cannot be reached by consensus.

Decision-making by consensus is the mostsuitable for the nature of the social andeconomic councils, their role and functions.However, since it is often not possible inthe present conditions due to generallyunfavourable social circumstances andthecontradictory interests of the socialpartners, decisions are made by majorityvote.

It is important to stress that documentsregulating these issues stipulate very strictprocedures and high requirements from thepoint of participation of the representativesof all social partners in the decision-makingprocess at the sessions of the social andeconomic council.

The Agreement on the Founding of theSocial and Economic Council of FYROMsets forth that the session must beattended by two-thirds of the councilmembers, with at least two members fromeach of the social partners.

The Agreement on the Founding of theSocial and Economic Council of Serbiaregulates:

Article 7

As a rule, the Council shall adopt itspositions and decisions by consensus.

In case the Council cannot adopt certainposition or decision by consensus, theposition i.e. decision shall be adopted by atwo-thirds majority out of the total numberof the Council members.

The rules on the work of the Social andEconomic Council of the Republika Srpskaalso stipulate alternative decision-makingby consensus or majority vote:

Article 20

The Council shall adopt acts within itscompetence in the form of decisions,conclusions, recommendations, proposalsand opinions.

On the matters within its competence theCouncil shall decide, as a rule, by fullconcordance of will of all the presentmembers of the Council (consensus).Notwithstanding the provisions ofparagraph 2 hereof, on minor issues aswell as on issues where consensus cannotbe reached the Council may decide bymajority vote, provided that the affirmativevote is cast by all three membersappointed by two of the partners in socialdialogue and at least one memberappointed by the third partner.

The proposal of decisions and other actsof the Council shall be formulated by theCouncil president.

A member of the Council attending asession cannot abstain from voting.

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It is worth noting that the provisionstipulating that a council member cannotabstain from voting is not in accordancewith basic human and political freedomsand rights.

In Croatia, the Economic and SocialCouncil decides by majority vote, providedthe session is attended by at least threemembers (out of five) of each of the threesocial partners.

The term of office of the members of theSocial and Economic Council is four years.The term of office of the president of theSocial and Economic Council, as a rule,lasts one year and is rotated betweensocial partners, meaning that the presidentof the Social and Economic Council inevery subsequent term is provided by adifferent social partner.

In certain countries (e.g. Romania) thepresident of the Social and EconomicCouncil is appointed by the Parliament atthe proposal of the council. This solutionhas its advantages, because it providesparliamentary control and influence on thework of the Social and Economic Council.

An important issue of the organisation andfunctioning of social dialogue mechanismsand institutions is financing. We shouldbear in mind here that we are discussingconsiderable material and financialrequirements, because they refer not onlyto the covering of the operating costs of the

social and economic councils at thenational level, but about the establishmentand extension of the network at the locallevel, education, promotion of the socialdialogue in the public, etc.

According to the national reports, countriesmainly opt for one of the following twosolutions:

1. All costs of the work of the social andeconomic councils are covered by thebudget.

2. All costs are split and covered jointly bythe social partners pursuant to theirmutual agreement.

Preference is given to the latter model,because it is considered that cost sharingis important for the equitable position ofsocial partners in social dialogue.

However, when assessing thesealternatives, we should not overlook thefact that where the work of the social andeconomic councils is covered by thebudget, which comes from taxes paid bycitizens and the corporate sector, thismeans that the employers and trade unionshave already contributed to theseresources.

This issue is particularly important becauselack of financial resources is among theserious obstacles for the faster buildingand better functioning of social dialoguemechanisms.

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8. THE WORK OF THE

SOCIAL AND ECONOMIC

COUNCILS

The content of work, that is, issuesconstituting the subject of work of thesocial and economic councils represent thecentral issue of the concept, social role,functions and real social power of thesebodies. Without underestimating theimportance of other issues, such as thelegal framework, participants, levels ofnegotiations, internal organisation andworking methods, we cannot deny that thework content has a decisive impact on thesolution of all the other above-mentionedissues.

The content of work of the social andeconomic councils reflects the real powerof social partners and their expectationsfrom social dialogue, conceptual similaritiesand differences concerning the role andfunctions of the social and economiccouncils and the constellation of socialpower of the actors in social dialogue.From the national reports and analyseddocuments that regulate this issue it isobvious that the definition of the content ofwork of the social and economic councils

was one of the key segments of theprocess of constituting social andeconomic councils and that this issue isregulated in detail in all documents on thefounding and operation of these bodies.

In this context, the definition of the workcontent of the social and economiccouncils can be treated as the first step inthe establishment of social dialogue andthe first real test of the actors insocialdialogue and their willingness to build theirrelations on new principles. Plainly stated,every participant in social dialogue,proceeding from its own position andinterests, strives to include in the council’scontent of work the issues that are mostimportant to that partner, and to excludefrom social dialogue certain importantissues referring to the social and economicdevelopment of society. In other words, thedefinition of the content of social dialoguewould be the first subject of confrontationand conflict between the actors in socialdialogue.

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The analysis of the content of the socialdialogue raises numerous theoretical andpractical questions referring to therelationship between social dialogue andworkers’ participation, collective bargainingand political decision-making. This followsfrom the fact that many issues that are thesubject of social dialogue are at the sametime the subject of different forms ofworkers’ participation, such as workscouncils, collective bargaining anddecision-making on the legislative andexecutive bodies of political authorities. Ofcourse, this raises in a novel way the issueof the relationship between social dialogueand various forms of industrial relations,such as collective bargaining and therelationship between social dialogue andpolitical decision-making.

The inspection of the work content of thesocial and economic councils at thenational level in the analysed countriesshows that these bodies deal with almostall relevant political, economic and socialaspects of the transition process. Some ofthese issues (e.g. restructuring anddevelopment of the national economy) areso widely and generally defined thatpractically all political, economic and socialissues of the transition process may fit intothis definition. Of course, such broadlydefined issues dealt with by the social andeconomic councils in any case reflect thedoubts of those who defined the content ofwork of the social and economic councils,unavoidable in the first steps of theirestablishment and development.

This claim is borne out by the review ofissues within the scope of the social andeconomic councils in different countries, asdefined by the founding document(agreement or law).

ROMANIA

The Economic and Social Council analysesthe economic and social situation of thecountry and makes relevant proposalssubject to legal provisions regarding:

� the restructuring and development ofthe national economy;

� the privatisation of the enterprises;� the labour relations;

� the wages policy;� the social protection and medical care;� the education and research;� the small and medium sized enterprises

development.

In the implementation of its advisoryfunction, the Economic and Social Councilis competent in:

� the issuance of opinions ongovernmental draft decisions andorders, and bills to be forwarded to theParliament;

� the briefing of the Government on theemergence of economic and socialevents that call for new regulations;

� the analysis of the causes of conflictsand the proposal for their settlement;

� the observance of duties following fromthe ILO Convention 144/1976 onTripartite Consultations, intended topromote the enforcement ofinternational labour standards.

SERBIA

The content of the Council’s workencompasses all issues relevant for theexercising of human freedoms and rights,material and social position of employeesand employers, their living and workingconditions, and in particular:

� labour legislation,� development and functioning of the

collective bargaining system,� protection of the freedom of

organisation of workers’ and employers’organisations,

� privatisation and its social andeconomic consequences,

� employment, labour and social rights,retraining and reemployment of theunemployed;

� conditions for education andprofessional training of employees,

� fiscal and price policies and their impacton the economic and social position ofemployees and the employers,� social policy with particular emphasis

on the securing of minimum socialand economic safety of employeesand citizens,

� health protection and healthinsurance system,

66

� pension and disability insurancesystem,

� occupational safety and health,working conditions of the employeesand the employers, protection of theliving and working environment,

� protection of women, children,disabled workers and other issues.

REPUBLIKA SRPSKA

In accordance with the scope of work of theCouncil stipulated by the Labour Law, themembers of the Council shall be entitledand obliged:

� to attend the sessions of the Counciland discuss and decide equitably on theissues within the competence of theCouncil,

� to encourage and promote the work ofthe Council, present their views andproposals on certain issues to thepartners in the social dialogue,government and other bodies,

� to foster collective bargaining andconclusion of collective agreements, topresent opinions and proposalsconcerning the contents of collectiveagreements and to directly participate inthe public debate in the process ofbargaining towards conclusion ofcollective agreements,

� to monitor, discuss and analyseeconomic policy measures in theRepublika Srpska,

� to monitor the situation in theimplementation of the social policy inthe Republika Srpska and to proposemeasures for the upgrading of the socialsecurity system,

� to propose methods for thereconciliation of the interests of theemployees and the employers with thegoals and measures of the social andeconomic policies,

� to monitor the implementation of theProgram for the Maintenance of SocialStability and to present opinions to theGovernment of the Republika Srpskawith a view to improving the situation inthat area,

� to monitor, discuss and give opinionsabout the regulations in the area oflabour, employment and social

protection and to propose upgradingand amendments to these regulations,

� to monitor the situation, discuss andpropose measures and activities inother areas of the economic and socialpolicies of interest for the partners insocial dialogue.

In addition to the tasks in paragraph 1hereof, the members of the Councildischarge certain tasks that are, inaccordance with the Labour Law, regulatedby collective agreements.

The members of the Council are entitled tothe remuneration for their work, inaccordance with the special agreementbetween the partners in social dialogue.27

CROATIA

Article 6

In the aim of achieving the objectivesreferred to in Article 1 hereof, the Councilshall:

� monitor, study and evaluate the impactof the economic policy and economicpolicy measures on the social stabilityand development;

� monitor, study and evaluate the impactof the social policy and social policymeasures on the social stability anddevelopment;

� study and evaluate the impact of thechanges in prices and wages on theeconomic stability and development;

� provide elabouration to the minister oflabour on all problems referring to theconclusion and implementation ofcollective agreements;

� propose to the Government, employersand trade unions, i.e. their associationsand higher-level organisations theimplementation of balanced price andwage policies;

� monitor the situation in the area ofemployment, pension and healthinsurance;

� determine the list of conciliators i.e.members of the conciliation council;

� determine the list of arbiters i.e.arbitration;

� adopt the regulation on the manner ofthe election of the members of theconciliation council and procedurebefore the conciliation council;

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8. THE WORK OF THE SOCIAL AND ECONOMIC COUNCILS

27 National Report, pp. 2–3.

� give opinions on the draft laws in thearea of labour, social security and publicservices;

� give opinion on the proposedgovernment budget;

� promote the idea of the tripartitecooperation between the Government,trade union organisations andemployers’ organisations in the solutionof economic and social issues andproblems;

� encourage peaceful solution of collectivelabour disputes;

� give opinions and proposals to theminister of labour in connection withother issues regulated by the LabourLaw;

� monitor the implementation of the lawsin the area of labour and social security;

� monitor the exercising of the protectionof labour rights and social security rightsand propose measures for the upgradingof that protection;

� adopt the rules of procedure for itswork.28

MONTENEGRO

The Social and Economic Council shall inparticular, in accordance with the DraftLabour Law:

1. Supervise, analyse and evaluate theimpact of economic policy andeconomic policy measures on the socialstability and development;

2. Supervise, analyse and evaluate theimpact of the social policy and socialpolicy measures on the economicstability and development;

3. Analyse and evaluate the impact ofchanges in prices and wage levels onthe economic stability and development;

4. Give opinions on the issues referring tothe conclusion and implementation ofthe general and branch collectiveagreements;

5. Give opinions about the draft laws in thearea of labour and social security.29

KOSOVO

Instruction No. 2001/17 on the Structureand Functioning of the TripartiteConsultative Council provides that theCouncil is responsible of:

� Advising the provisional institutions ofself-government in the formulation ofthe labour, social welfare and economicpolicies;

� Encouraging collective contracts andagreements at the branch level, butespecially at the Kosovo level;

� Dealing with other activities in the filedof labour and social welfare if there isapproval of members of the Council. 30

ALBANIA� Revision and salary indexing and

economic support,� Analysis related to informal labour

market,� Pension level and ways to increase it,� Treatment of ILO Conventions related to

salaries,� Maternity protection,� Improvement of labour legislation,� Subsistence minimum.

BOSNIA AND HERZEGOVINA

The Council’s area of competence, on anequal footing:

� to encourage improvements in theCouncil’s work, put forward theirattitudes and proposals concerningcertain issues to their partners in thesocial dialogue, state and other bodies,

� to encourage collective bargaining andconcluding of collective agreements,present their own opinions andproposals regarding the substance ofcollective agreements and directlyparticipate in public debates and theprocedure of concluding collectiveagreements,

� to monitor, consider and analysemeasures of the economic policy in theRS,


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30 National Report of Kosovo, p. 4.

� to monitor the situation as regards theimplementation of the social policy inthe RS and suggest measures with theaim of improving the social system,

� to propose the manner of harmonisationof the interests of workers andemployers with the goals and measuresof the social and economic policy,

� to monitor the implementation of theProgram of Maintaining the SocialStability and present their opinions tothe Government of the RS with the aimof improving the situation in that area,

� to monitor, consider and give theiropinions about regulations in the filed oflabour, employment and social andpropose their completion andimprovement,

� to monitor the situation, consider andpropose measures and activities inother areas of the economic and socialpolicy which are of interest to thepartners in the social dialogue. 31

All the mentioned issues dealt with by thesocial and economic councils at thenational level may be classified into thefollowing groups:

� strategy of the social and economicdevelopment, privatisation andeconomic policy measures and theirinfluence on social stability;

� social policy,� wages, including minimum wages, price

and wage adjustments;� development of the collective bargaining

system;� employment, labour market, including

black labour market;� ratification and implementation of the

ILO Conventions and other internationaland legal documents;

� pension, disability and health insurance,� protection of the living and working

environment;� education, science, including vocational

training.

In addition to the above-mentioned groupsof issues, the social and economic councilsin Bulgaria, Romania and Croatia devoteparticular attention to systematicengagement on the issues relating to the

programme of accession of these countriesto the European Union. The national reportof Romania highlights this as follows:

Romania’s Accession needs a stronginvolvement of the social partners andother components of the civil society,representatives and defenders of thedifferent social rights and interests. In thisarea, The Cross-ministerial Committee forEuropean Integration has a very importantrole. The Cross-ministerial Committee forEuropean Integration is an operative bodythat coordinates, analyses and debates thedocuments elabourated by the institutionsthat have responsibilities concerning theProcess of Adherence to the EU anddiscusses any other issues connected withthe progress of the Process to prepare theIntegration.

The social partners are invited, along withother interest groups representatives, tothe works of the Cross-ministerialCommittee for European Integration,whose meeting take place in Plenum or inwork sections. In the same time, the socialpartners are consulted in the Commissionfor Social Dialogue within the Minister forEuropean Integration. There are someimprovements in the process of consultingthe social partners that have to beimplemented in the future in the same timewith some actions that can improve theknowledge and understanding of the socialpartners concerning the process forEuropean integration. 32

Social partners have obviously found acommon ground on this issue, aware that itis of strategic developmental interest to thewhole society, hence to every socialpartner individually. This is a goodexample, particularly since it can contributeto the approximation of the social partners’positions in other areas, too.

It is also obvious from the national reportsthat a very large part of the activity of thesocial and economic councils refers to theirparticipation and influence on theenactment of legal regulations, primarily inthe area of economic and social policy andlabour legislation. This is logical, since the

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31 National Report of Bosnia and Herzegovina, pp. 10–11.

32 National Report of Romania, pp. 31–2.


legislation regulates fundamental relationsin these areas and in fact defines theposition of social partners. Withoutdisputing the importance of this activity, it isnecessary to highlight certain points whichput trade unions and employers in a lessfavourable and often marginal position inthese processes.

First of all, bills are as a rule drafted by thegovernment. This situation gives it a headstart compared with the other two socialpartners. Secondly, trade unions andemployers’ organisations in south-easternEuropean countries as a rule have poorlydeveloped financial, technical and humanpotentials, which is a limiting factor for theirparticipation in, and influence on,legislative activity. In addition, there areother adverse circumstances, such asfrequent pressure on the government topass laws under so-called ‘emergencyprocedures’, manipulation of the requestsof international financial institutions, etc. Allthis generates a real risk that trade unionsand employers’ organisations may becomemarginalised in legislative activity, withtheir role reduced to giving consent tocertain legislative projects. There is alsothe question of the strategy of trade unionsand employers’ organisations and their realability to successfully discharge their roleand functions.

An important element of the content ofwork of the social and economic councils ispromotion of social dialogue, its maingoals, values and encouragement ofvarious social actors to participate in socialdialogue.

In the same way, social and economiccouncils in certain countries havesubstantial power in the area of collectivebargaining, settlement of collective labourdisputes, and the determination ofcomposition of conciliation and arbitrationcouncils.

The presented content of work, that is, thereview of issues dealt with by the socialand economic councils is actually a rangeof theoretical and practical issues referringto the place, role and objective reach insocial and political processes and in

political decision-making. There are twoconspicuous differences in width of thespectrum of issues dealt with by the socialand economic councils in differentcountries. In this regard, the followingpattern is apparent. In countries that aretaking their first steps in the process of theestablishment of social dialoguemechanisms, the content of work of thesocial and economic councils focuses on anarrower range of issues, primarilycollective bargaining, wages and socialpolicy. On the other hand, in thosecountries where significant progress hasalready been achieved in the developmentand functioning of social dialogue, thecontent of work of the social and economiccouncils is extended to a larger circle ofissues, including some strategically politicalissues.

In any case, it is obvious that the socialand economic councils engage in a widerange of political, economic and socialissues and hence inevitably enter into thesphere of political life and politicaldecision-making. In addition, it is obviousfrom the national reports that there exists atendency towards continuous expansion ofissues addressed by the social andeconomic councils. This can be treated asa positive tendency, as an indicator thatparticipants in social dialogue regard thesocial and economic council as a forumwhere different interests can besuccessfully reconciled and positions onimportant political, economic and socialproblems developed. All this is favourablefor the prospects of social dialogue.

However, this tendency poses a number ofquestions. The first one is the ability of theparticipants in social dialogue completely,in an organised and systematic fashion, todeal with these issues. It should be bornein mind that all three social partners(government, trade unions, employers)must have at least approximately the sameability to address the issues that are thesubject of social dialogue in order thatsocial dialogue can be based on itsauthentic principles. Does that, inperspective, lead to the establishment ofparallel teams of experts for these areaswith all three social partners?

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In other words, continuous expansion ofthe range of issues dealt with by the socialand economic councils, without otheradequate changes in their organisation andmethod of working, entails the potential riskthat they may turn into futile discussionclubs and even become scapegoats for theproblems that may emerge in the areas inwhich they work.

The second question concerns the issuesthat should be the subject of socialdialogue. Is there any dividing line at allbetween the issues that should and thosethat should not be included in socialdialogue, and what are the criteria fordrawing that line? The question can bephrased in another way: Is there anyimportant political, economic or social issuefor which we can expressly say that it doesnot have to be the subject of social

dialogue and support this claim with good,acceptable arguments?

Finally, the above questions and dilemmaslead to the essential question of thestrategy of development and objectivereach of social dialogue in the time tocome. Will social dialogue remain only oneof the forms of democratic participation ofcitizens and employees in the process ofdecision-making on relevant social issues,or will the strengthening of the importanceand influence and continuous expansion ofthe range of issues included in the socialdialogue turn this process into analternative form of politicaldecision-making, actually into a new stagein the political organisation of society,which will also place the traditionalinstitutions of multiparty parliamentarydemocracy in a new position?

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9. COLLECTIVE BARGAINING

Since the first steps in the transitionprocess in the countries of south-easternEurope, trade unions have devotedexceptional attention to the establishmentand development of a system of collectivebargaining and collective agreements, asone of the cornerstones of trade unionstrategy and a strategically important factorof the new social structure. Both tradeunions and employers’ organisations dealtwith collective bargaining and collectiveagreements, but the principal promoter andthe party bearing the greatest responsibilityfor this process in all the observedcountries was the trade unions simplybecause absence or insufficientdevelopment of the collective bargainingsystem affected labour the most.

Placing collective bargaining at the centreof attention of the trade unions and othersocial partners was the result of twocategories of reasoning. First, it is theexperience of developed, democraticmarket-economy countries, wherecollective bargaining and collectiveagreements have operated successfully fordecades as a meaningful and efficientmechanism for regulating the relationships

between the world of labour and the worldof capital. Secondly, demolition of themechanism of workers’ protection from thetime of the socialist, centrally plannedeconomy and single-party system urgedprimarily trade unions, but other socialpartners as well, to build new mechanismsof industrial relations and protection ofemployees’ rights. That need is particularlystrong in the conditions of restructuringnational economies, the consequences ofwhich have most severely affectedemployees.

In any case, the fact that social partnersattach exceptional importance to thedevelopment of acollective bargainingsystem must be assessed as very positive.Regardless of the differences expressed inthe development of a collective bargainingsystem and in the creal collectivebargaining processes, we may say that thefirst, most important phase in the processof the introduction of collective bargaininghas largely been overcome – minimumagreement has been reached betweensocial partners that collective bargaining isthe cornerstone of their future relations, orat least that without collective bargaining

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there will be no stable economic andpolitical development and integration intoEurope.

The relationship between the socialdialogue and collective bargaining is veryoften the subject of theoretical andprofessional debate. Considerabledifferences are manifested in theory and insocial practice concerning bipartite andtripartite relations and whether collectivebargaining can be treated as a form ofsocial dialogue or not. History as a teacherof life can be of great help here. Historicallyand chronologically, collectivebargainingwas established first, at theenterprise level, and then at other levels.The first forms of social dialogue emergeddecades later, after collective bargaininghad travelled along a good part of itsdevelopmental path. The history of thedevelopment of collective bargaining andsocial dialogue gives rise to the conclusionthat social dialogue could not developwithout the prior existence of collectivebargaining. In this sense, we may say thatcollective bargaining and collectiveagreements are the foothold of socialdialogue.

This is corroborated by numerousdefinitions of collective bargaining.Common to most of them is that collectivebargaining is a permanent, systematicmechanism for regulating relationsbetween employers and employees, withspecific participation of government, as aform of prevention of collective industrialconflicts. However, it is necessary to add tothis that collective bargaining and collectiveagreements constitute a specificmechanism – a partly non-marketmechanism for regulating relations in thelabour market. In this context, we shouldbear in mind that in the conditions of amarket economy the labour marketbehaves basically in the same way as theother two elements of the market economy,the commodity market and the capitalmarket. All three markets are subject to theoperation of the laws of supply anddemand. This means that when demandfor goods, capital and/or labour increases,their prices increase as well. Conversely,when demand for goods, capital and/orlabour declines, their prices also fall.

Theoretically, the price of goods andcapital may fall to zero, because theowners will try to sell the goods and/orinvest capital even under the leastfavourable conditions. The labour market isspecific in this regard: the price of labour,under the influence of market, cannot fallto zero, but only to the level that provides asubsistence minimum (i.e. reproduction ofthe labour of the worker and his family). Inmodern, developed, democratic societies,such as the EU countries, for manydecades this has not been the subsistenceminimum, but an amount enough toprovidethe quality of life and human dignityappropriate to the achieved level ofpresent-day civilisation. This is the dividingline that opened up the way for theexpansion of the circle of issuesencompassed by collective bargaining andcollective agreements at different levels. Infact, collective agreements in this wayentered the sphere which before that timewas solely the sphere of politicaldecision-making. This is the authenticconnection between collective bargainingand social dialogue. In this sense it can beaccepted that collective bargaining is aform of social dialogue, with social dialoguebeing a higher phase in the development ofindustrial and political democracy. Finally,in contemporary societies this is caused bythe interrelationship between economicand political processes and the fact that itis not possible to establish permanent,stable social harmony at the enterpriselevel, without having the same conditionsat the level of socity as a whole.

Collective bargaining is an autonomousprocess based on actors’ voluntariness,and collective agreements in this regardare treated as a specific source of labourlegislation. This raises the issue ofrelations between collective bargaining andthe legal framework in a specific way. Theexperiences of developed, democraticcountries are in this regard very different.There are countries where the legalframework is almost nonexistent or veryrestricted, while collective bargaining iswell developed and has largely assumedthe functions of labour legislation. On theother hand, there are countries where thelegal regulation of collective bargaining isvery well developed, specific and detailed.

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75

The specific course of the establishmentand development of collective bargaining,that is, generally unfavourable socialcircumstances in which the system ofcollective bargaining has been built andtook place, resulted in the very significant,sometimes overemphasised, role oflegislation.

In this regard, the national reports point outthat the right to collective bargaining and itsmain principles and mechanisms areprotected by constitutions and laws.

The national report of Albania describesthis as follows:

All the procedures and mechanisms forfulfilling collective bargaining are basedupon:

� The Constitution of the Republic ofAlbania,

� The Labour Code.

In Chapters 14 and 15 of the Labour Codea number of articles are devoted to thecontents of collective bargaining. Thesecomprise provisions on employmentconditions, employment relations andcontents and signing of individual labourcontracts, professional training andrelations between the bargaining parties.

Several elements that affect the outcomeof social conflicts are:

� Non-acknowledgement at the desiredlevel of the labour legislation on the partof social partners, employers andemployees,

� Non-functioning all over the territory ofthe reconciliation and arbitration officesdue to the lack of appropriatepersonnel. In cases when thereconciliation office functions, thequality of services offered is not up tothe required level due to the lack of stafftraining.

� Non-application of legislation byemployers and employees regardingsocial conflicts.33

The law adopted in Romania in 1996defines the following principles andfunctions of collective bargaining:

The negotiation, conclusion, execution andtermination of the collective agreementsare regulated by Law 130/1996. Thecollective agreement is a conventionconcluded between the employer and theemployers’ organisation on the one handand the employees represented by thetrade unions or by any other legal capacity,on the other, establishing clauses onworking conditions, wages and other rightsand duties resulting from the labourrelations. The conclusion of collectiveagreements is intended to promote fairlabour relations able to ensure theemployees’ social protection, theprevention or limitation of collective labourdisputes or industrial actions (strikes). Theagreements between the signatory partiesof the collective agreements, which settlecollective labour disputes, are also part ofthe collective agreements. The collectivebargaining at the enterprise level iscompulsory, except in the case when theenterprise has less than 21 employees.The collective bargaining takes place everyyear and the duration of the collectivebargaining cannot exceed 60 days.34

The level of formal legal protection of theright and basic principles of collectivebargaining has been the subject of fierceconflict, and even the reason for a generalstrike and public protest organised inOctober 2001 by the two largest tradeunions in Serbia – the Confederation ofTrade Unions of Serbia (SSS) and TUCNezavisnost. The conflict broke out overthe formulation of Article 1 of the LabourLaw, which reads:

Article 1

The rights, obligations and responsibilitiesarising from employment shall beregulated by law and special laws inaccordance with ratified internationalconventions.

The rights, obligations and responsibilitiesreferred to in paragraph 1 of this Article,shall be regulated by the collectiveagreement or rules of work (hereinafter:internal regulations) and contract ofemployment.




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In the opinion of trade unions, thisprovision has very much relativised the roleof collective agreements, as an optionalform of the regulation of labour relations,thus leaving them only to the goodwill ofthe employers.

The tendency to regulate all the details ofcollective bargaining by law is apparent inthe countries where collective bargaining,due to the particular social circumstances,is least developed. They obviously neededspecific regulation of certain issuespertaining to labour relations and to providemaximum efficient protection of thecollective bargaining mechanism.

This situation is described in the nationalreport of Bosnia and Herzegovina:

With the beginning of the process of theownership transformation and capitalprivatisation in state-owned companies inthe RS and FB&H, changes werenecessary in the legislation as well,particularly in the field of labour andemployment, for this process had creatednew socio-economic relations in the RSand FB&H requiring adequate labourlegislation based on international labourstandards.

Collective agreements as documents bymeans of which its participants regulatecertain relations in the labour system arementioned in about 50 provisions of theLabour Law. This fact suffices for one toconclude how important collectiveagreements are as instruments of thelabour legislation in the RS and FB&H. TheLabour Law kept many earlier provisionsas regards the system of a graded orderingand ranking of collective agreements ormade certain adjustments in accordancewith modern options concerning the level oforganisation of participants in concludingcollective agreements.35

The national report of Bulgaria points outthat changes in the Labour Code createdthe fundamental prerequisites for thedevelopment of collective bargaining into abasic mechanism for the regulation ofrelations between labour and capital in thefollowing sense:

The amendments to the Labour Code (LC)in 1992 (enacted on 1 January 1993)provided the necessary legal safeguardsfor turning collective bargaining into a basicmechanism for regulating labour relations:

� collective agreements became a sourceof norms for regulating industrialrelations for the first time;

� it opened a wide field for concludingagreements at the expense of severecuts in the imperative stipulations of theLabour Code from 1986, which left noroom for collective bargaining;

� it created a new model for the legalregulation of labour relations. The lawpreserves its role of a regulator butcontains minimum norms for labourprotection and determines minimumlevel of employees’ rights and workingconditions, leaving room for bargainingfor more favourable conditions throughcollective agreements.36

The attempt of the government to excludecertain strategically important activities,financed from the budget, from collectivebargaining, in other words to regulateemployees’ labour rights in these sectorsby the law, is apparent from the analysis ofthe legal framework for collectivebargaining. Thus, unionised workers inthese sectors are directly deprived of oneof their fundamental rights – the right tocollective bargaining, while the meaning ofunionisation is disputed as well, becauseone of the key trade union functions –conclusion of collective agreements isdenied to these trade unions. In doing this,the government is resorting to the tried andtested carrot-and-stick method, offeringvarious benefits to the employees in theseactivities, trying to convince them that theyare in a privileged position in relation toemployees in other sectors and at thesame time subjecting them to variousforms of pressure.

Characteristic in this regard is theexperience of Croatia described in itsnational report:

After 2000 the General CollectiveAgreement for the employees in publicservices has not been extended. Instead,

35 National Report of Bosnia and Herzegovina, p. 6.


labour and social rights of employees inpublic services have been regulated by theLaw and the Ruling on Salaries. By thesemechanisms, considerable change in thecomposition of salaries in this sector hasbeen made. The key characteristic of thischange was abandonment of the system ofsalary classes and the principle of payaccording to seniority and the introductionof the payment system according to thecomplexity of the job. According to theavailable information, the idea underlyingthe change in the composition of salarieswas to increase the salaries of employeeswith a university degree (as one of themeasures to foster the efficiency of thegovernment administration). However, inthe conditions of tight budget restrictions(and reduction of the salary fund), thechange in the composition of salariesresulted in drastic drop of salaries ofemployees with secondary education.37

The tendency towards creating a stronglegal framework for the collectivebargaining system is a logicalconsequence of the underdevelopment ofthis system and the inferior social power oftrade unions. In the first phase this may beof great importance for the protection andcreation of the conditions for the operationof the fundamental principles andmechanisms of collective bargaining.However, retaining the predominantfunction of legal norms backed bygovernment compulsion in relation to anautonomous system of collectivebargaining breeds the potential risk ofretaining it permanently in place under themask of formal legal equality, therealistically inequitable relations betweensocial partners and the system ofquasi-collective bargaining in whichcollective agreements serve as a mask forissues already regulated by law.

Collective bargaining and collectiveagreements in south-eastern Europeancountries have been, or are in the processof being, established at different levels ofthe economic, territorial and politicalorganisation of society. Compared with thedeveloped democratic countries in Europeand the world where collective bargaininghas been a tradition for many decades, theintroduction of collective bargainingproceeded in different sequences. In otherwords, collective bargaining and collectiveagreements in industrialisedmarket-economy countries were firstestablished at the enterprise level. Onlyafter collective agreements at theenterprise level reached a certain level ofdevelopment and power, did they serve asa basis for the establishment of acollectivebargaining system at other levels. Thepresent levels of collective bargaining,which constitute more or lesscomplementary wholes, have beenestablished as a result of a process thatdeveloped over decades.

In the countries of south-eastern Europe,the establishment of different levels ofcollective bargaining proceeded from topdownwards – from collective agreements atthe national level to collective agreementsat the enterprise level. This process haslargely had the characteristic of beingimposed from above, without adequatefoothold. In any case, it had a limiting effecton this process.

The national reports point out that thecollective bargaining system has beenestablished at different levels, as shown bythe data in Table 6.

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Table 6. Levels of collective bargaining in south-eastern European countries

Collective bargaining at the branch andenterprise level exists in all countries. Inthe history of collective bargaining, theseare indisputable, traditional levels ofcollective bargaining.

Collective bargaining at the local level (atthe level of territorial-political units) is theleast developed, as the reflection of theoverall social circumstances, including thedevelopment of local self-government. Thisis obviously the task that social partnerswill seriously face in the future.

Three of the observed countries (Bulgaria,Albania, Croatia) do not have collectiveagreements at the national level (so-calledGeneral Collective Agreements). Theexperience of developed market-economycountries shows that they have nocollective agreements at the national leveleither. Instead, a minimum level ofemployees’ rights is protected by law.Dilemmas and disputes over the sameissues are present in the countries ofsouth-eastern Europe. In this regard, wecan accept as justified the opinions oftheoreticians and experts from thesecountries that the so-called generalcollective agreements at the national levelare remnants of the past, that is, the formerpractice when the government regulated allkey economic, social and politicalprocesses in society, including the area ofwages, other employees’ rights and mutualrelations, rights and obligations ofemployees and employers, which wouldnormally be the subject of collectivebargaining. Owing to all the

above-mentioned, the argumentmaintaining that it is more reasonable toprotect the basic relations and minimumlevel of employees’ rights by law than by ageneral collective agreement at thenational level appears acceptable.

This position is corroborated by the factthat all the observed countries respect thebasic principle of relations betweencollective agreements and the law,so-called in favorem laborem, according towhich the law determines minimumemployees’ rights, and collectiveagreements define only a higher level ofrights than those stipulated by law.

Consistent with this is the principle ofrelations between collective agreements atdifferent levels according to which acollective agreement at a lower levelcannot stipulate lesser rights for employeesthan those determined by the collectiveagreement at a higher level, whereby thealternative more favourable for theemployee is always implemented.

The analysis of the contents shows thatcollective agreements, particularly at higherlevels, encompass an exceptionally broadarray of issues, with some of them having apredominantly political character. Also,there is a tendency to expand the subjectof collective agreements, that is, to includecontinuously new issues into the collectivebargaining process. The same tendencyhas been noted in the content of work –issues within the sphere of social andeconomic councils at the national level.


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CountryLevel of collective bargaining

National Branch Enterprise Local

Albania × ×

Bosnia and Herzegovina × × ×

Bulgaria × × ×

Croatia × × ×

Kosovo

FYROM × × ×

Montenegro × × ×

Republika Srpska × × ×

Romania × × ×

Serbia × × ×

A comparative analysis shows thatcollective agreements at the national level,and social and economic councils oftencover identical issues. This in fact createsa new aspect of relations between socialdialogue and collective bargaining, whichwill be the subject of future analyses andresearch.

Very often the list of issues that are thesubject of collective bargaining is similar tothe list of problems faced by south-easternEuropean countries in the course oftransition.

This is confirmed by many examples,including Romania, where a very broadarray of issues constitutes the subject ofcollective bargaining:

� Labour relations under specificconditions,

� specific working conditions, rights andduties,

� discipline at work,� methods of filling vacancies

(examinations, interviews),� probation,� circumstances when the criteria

adopted in case of layoff are applied,� employees’ rights in case of cease of

the pension contract,� specific rights for specific working

conditions,� circumstances when free medical

consultation is granted to employeesworking under specific conditions,

� specific rights for a special protection atwork for women and young workersunder eighteen,

� extra assistance granted to the workerssubject to industry injuries or tooccupational diseases other than thatstipulated in the collective agreement atbranch level,

� payment systems,� conditions and criteria for bonus

granting,� other criteria for the income raise

(foreign language proficiency, etc.),� implementation of the layoff provisions,� payment dates,� working hours in institutions with special

working time,

� employees who benefit from ‘breaks’ orreduced hours of work,

� payment or compensation in time off forthe extra working hours,

� other special situations which mayoccur with institutions not complyingwith the eight-hour working time,

� holiday bonus, other than annualholiday indemnities,

� extra leaves,� time off in lieu,� extra unpaid leave,� particular aspects of the vocational

training (identification of the jobs whichrequire qualification, ways of achievingqualification, period of time when theemployee is obliged to work in theinstitution following some qualificationtraining, etc.),

� special working conditions for theemployees such as the ban ondisclosure of confidential informationand on alienation of the institution’sassets, the duty to make rational use ofthe materials, supplies, fuel and energy,the liability to observe confidentiality,etc.

� working time for the union leaders,� union activities requiring the institution’s

equipment,� material or financial compensations for

social activities.38

� The course of the process of transitionand enterprise privatisation causesissues such as the conditions underwhich the enterprise will be privatised,protection of employees’ rights in thenew circumstances and/or settlement ofthe redundancy problem to appear asthe subject of collective bargaining. Inthese negotiations, alongside therepresentative(s) of the trade union andthe representative(s) of the employer atthe enterprise level, the representativesof the competent ministries and futureowners of the enterprise also take part.This is a logical attempt to securethrough the bargaining process as goodposition as possible for the employeesin the upcoming processes of theeconomic, technological andorganisational restructuring of theenterprise. This is in fact a kind ofbridge and creation of a maximum

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38 National Report of Romania, pp. 35–6.

favourable starting position in theupcoming relations with the new owner,i.e. employer. A very characteristicpositive example in this regard is quotedin the national report of Croatia:

Analysis of the collective agreement on the

calculation and payment of wages and

other employees’ material benefits in the

glassmaking company Vetropack Staza

The Straza glass factory was bought in1996 by the multinational companyVetropack. Since the first negotiationsabout takeover, the new owner introducednew rules of the game. One of themreferred to keeping trade unionrepresentatives informed about thesituation in the organisation and plans forthe future. As did numerous otherorganisations in 1996, Straza also sufferedfrom redundant labour. Therefore, the newowner announced a plan for a manpowercut from 1,500 to 600. Over the next fiveyears this plan was fully implemented,either through separation of certainorganisational units or through dismissal,with adequate severance pay. According tothe words of the trade unionrepresentative, this process, so painful forevery organisation, was completed in away that left no one disappointed.

In addition to the operational restructuring,which included considerable investmentsinto production modernisation, VetropackStaza managed to achieve the change inorganisational culture and organisationalclimate. The management style of the newowner, primarily because he representedthe epitome of values such as respect andconfidence (for example, every time hevisited the factory he asked to meet theshop steward) started the process ofchanges. Encouraged for the first time byvisible manifestations of respect, the tradeunion local returned with a goodwill gestureto the new owner, proposing to organisevoluntary work of all employees in order tosolve the current business problem. Thisestablished a spiral of ever better relationsbetween the trade union and the newowners in the Vetropack Straza factory.The owner’s style of running the factoryinduced changes in the attitude of the

company management. Relations ofcooperation replaced former conflictingindustrial relations.

According to the words of the trade unionrepresentative, the factory managementconsistently implements the concept of‘open book management’. This means thatall the information about the operatingresults, production, human resources,logistics, etc. are at any time available tothe shop steward.39

An important issue and the subject ofconflict in the collective bargaining processis the question of the validity of collectiveagreements. Do collective agreementsapply to all employees or only to theemployers who are the members of thecertain employers’ organisation? There arethree basic models encountered ininternational practice:

� the collective agreement applies to allemployees (so-called extended effect ofcollective agreements),

� the collective agreement applies only tothe employers who are members of theemployers’ organisations that concludedthe collective agreement,

� the collective agreement applies only totrade union members.

Having in view the generally unfavourablesocial circumstances in which collectivebargaining takes place in south-easternEuropean countries, as well as a poorlydeveloped collective bargaining system, itis logical that trade unions in thesecountries strive to ensure the application ofcollective agreements to all employees. Inthis way they implement the principle ofworkers’ solidarity and motivate theemployees to join the trade union thatsecured them certain benefits through thecollective agreement.

The political authorities and the employers’organisations often take the oppositestand, stressing the neo-liberal view thatcollective agreements and their conclusionare solely the matter of the goodwill of thetwo parties – trade unions and employers.Thus they neglect, consciously or not, thatcollective bargaining is the accomplishment

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39 National Report of Croatia, pp. 43-44.

of present-day civilisation and thecornerstone of social harmony. Such anattitude places the generally weakerpartner in the process of collectivebargaining – the trade union – in a veryunfavourable position. This is reflected inthe further erosion of thealready weaksocial power of trade unions and a declinein the number of trade union members.

This is emphasised in the national report ofAlbania as one of the major problems inthe process of collective bargaining.

Several difficulties have been observedwith collective bargaining in Albania, andthey include:

� Lack of experience,� The question of trade union

representation and trade uniondisputes,

� Lack of democratic culture and of socialdialogue,

� Misunderstanding of the trade union’srole as important institution for theestablishment of a democratic state.

� Pressure and anti-trade union measureson the part of state employer,

� Objections from state and privateemployers to carrying out collectivebargaining,

� Lack of qualified negotiators,� Employers’ lack of knowledge on

application of legal requirements.40

A much better situation in this regardprevails in Romania, as described in thenational report for this country:

The provisions of the collective agreementproduce effect to all the employees in anenterprise, irrespective of their employmentdate or their affiliation to an enterprisetrade union organisations. The collectiveagreements can be concluded at theenterprise, group of trade companies,régies autonomes, branch and nationallevel. The clauses of the collectiveagreements can produce effect to all theemployees in the enterprise in case ofcollective agreements concluded at thislevel; to all the employees belonging to the

enterprise for which the collectiveagreement was concluded at this level; forall the employees employed at that specificbranch for which the collective agreementwas concluded; to all the employeesemployed in enterprises all over thecountry in case of collective agreements atthe national level. At each level, one singlecollective agreement is concluded.Collective agreements can also beconcluded for the employees of budgetaryundertakings excepting the clausesreferring to rights established under legalprovisions.41

In Croatia the collective agreement obligesonly the employers who are the membersof the employers’ association whichconcluded the collective agreement at acertain level. This practically means thatvery small percentage of workers areprotected by collective agreements. This ishow this situation is described in thenational report of Croatia:

Subjective validity

According to legal provisions, the collectiveagreement is binding on all persons whichconcluded it for all persons who at the timeof the conclusion of the collectiveagreement were or subsequently becamemembers of the organisation whichconcluded the collective agreement.

Exceptions from this rule apply in thefollowing cases:

� Transfer of the employment contract toanother employer in the case of statuschanges (the collective agreement thatwas binding on the former employershall be binding on the new employer aswell);

� Accession to the already concludedcollective agreement;

� Extension of the application of theconcluded collective agreementpursuant to the decision of the ministerof labour and social welfare to thepersons who did not participate in itsconclusion nor subsequently acceded toit.42

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Montenegro applies the principle ofextended validity of collective agreements,meaning that collective agreement appliesto all employees.

In FYROM the law also stipulates that theGeneral Collective Agreement concludedat the national level refers to all employees.

This issue is not regulated by the LabourLaw in Serbia, which implies that thecollective agreement refers only to theemployers who concluded it. Since this isonly a matter of employers’ goodwill andinterest, it can be expected that only asmall number of employees will beprotected by collective agreements.

With this situation in mind, it is necessaryto add that the readiness of employers andtheir associations to participate in collectivebargaining will largely depend on the realsocial power of the trade unions.

In addition, it is certain thatunderdevelopment of the collectivebargaining system and non-applicability ofcollective agreements on a large number ofemployees will be a permanent subject ofindustrial conflict and source of instabilityand will thus ultimately harm all the actorsin collective bargaining. This should be asufficient reason for the participants of thecollective bargaining to seek jointly betteralternatives in this area.

10. SPECIFIC FORMS OF

SOCIAL DIALOGUE

During the course of their development,social and economic councils proved to bethe most rational form and the focal point ofsocial dialogue. The relationship betweensocial and economic councils, on the onehand, and other forms of social dialogueand employees’ and citizens’ participation,and influence in the decision-makingprocess, on the other, largely resemble therelationship between centrifugal andcentripetal forces in nature. While one kindof force moves towards the centre, theother moves to the periphery, but therelationship between the forces must bebalanced, for if any one of them prevails, itwill cause the collapse of the system.

Having this in mind, social actors havedevoted considerable attention to theestablishment, development andaffirmation of the role and influence of thesocial and economic councils. They havedone this primarily at the national level,through activity towards the establishmentof social and economic councils at the locallevel started in some of the countries. In allof past experience this would be the firststep towards the establishment of social

dialogue as a radically new form ofemployees’ and citizens’ participation andinfluence in the process of making relevantpolitical and social decisions.

However, in this case, too, it has provedtrue that the first step in any area of sociallife and work raises questions and opensup the way to the next steps. Developmentof social and economic councils, acquiringthe first experiences, pinpointing theadvantages and shortcomings of specificmodels have faced the actors in socialdialogue with one of the basic limitations –the inability to cover through social andeconomic councils all the variety in thecontent of form of contemporary societyand authentic law and the need of citizensand employees to exercise their influencein these different areas of human life andwork. This is after all only one of theaspects of a general limitation faced fordecades and increasingly obviously bymultiparty parliamentary democracy. In thisregard, we should remind that socialdialogue and social and economic councilsas a form through which social dialogue iscarried out, among other things, were the

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response to that noticed limitation ofmultiparty parliamentary democracy.

The answer to this question imposed bysocial practice has been sought in newinitiatives of social partners, i.e. in theintroduction of new, specific forms of socialdialogue. In this sense started and is underway the intensive process of theestablishment of tripartite bodies. Unlikethe social and economic councils, whichdeal in a wide array of issues, these bodiesfocus their activity solely to certain specificissues of interest for the social partners, aswell as for the economic and politicaldevelopment of society as a whole.

However, observing this process throughits quantitative aspect – establishment ofnew bodies within which social dialogue oncertain issues is conducted – would be toosimplified. The course of events in this areaso far gives rise to the conclusion that thisis a new phase, a new quality step whichwould considerably affect the content,course and other aspects of the socialdialogue. This is the process that wouldresult in the creation of a whole network ofbodies within which social partnersreconcile their views and interests oncertain issues, such as privatisation,employment, health protection, pensionand disability insurance, etc. This factfaces the theory and practice of the socialdialogue with numerous open questionsand dilemmas.

The first of these questions is whether theestablishment and functioning of thesebodies contribute to the upgrading of thesocial dialogue, and the main criterion forthis is the strengthening of the social powerof the social and economic councils andthese specific bodies in thedecision-making process. This should beregarded as a process of the emergence ofa new segment of the political and socialstructure, a qualitatively new centre ofsocial power, whose strength is not basedon government oppression, but ondemocratically agreed will of the participants.

The fact that social and economic councilsand the specialised bodies constitute awhole is corroborated by the fact that thespecialised bodies are established andoperate basically in the same way as thesocial and economic councils.

It follows from the national reports thatthese bodies in which social dialogue onspecific issues is conducted are veryunevenly developed and widespread. Thisis the consequence of the specific courseof the entire transition process and in thisscope – of the establishment anddevelopment of the social dialoguemechanisms. The number and structure ofthese specific bodies points to two issues.

First, the number of these bodies is higherin the countries where social dialogue ismore developed or, to put in other words,the number and structure of these bodiescan be taken as a reliable indicator of thedegree of development of the socialdialogue. This is confirmed by the thesisthat the development of the social andeconomic councils and exceptionally widearray of issues they deal with in practiceimposed the need that certain specificissues, which constitute relativelyindependent problem wholes, be delegatedto other bodies that would address onlythese issues. For example, in severalcountries of south-eastern Europe no suchbody has been founded so far.

Secondly, the areas for which these bodieshave been founded are the indicator of themajor problems faced by these countriesand social partners in the economic andsocial life of society. That is to say, it islogical that the social partners first foundedthese specific social dialogue bodies todeal with what they considered to be themost complex and the most pressingproblems in society that can be the sourceof the greatest social conflicts. It isimportant to stress that these bodies aremainly founded on the basis of law and thatinstitutionally a place for trade unionrepresentatives is provided in them. Thiscertainly ensures a satisfactory startingposition for trade unions in these bodies.This statement is borne out by the findingspresented in the national reports of someof south-eastern European countries.

In some of the observed countries tradeunions have advocated the introduction ofthe institution of the ‘vacant seat’ inparliament, as a form of keeping tradeunions informed and making it possible forthem to influence the decisions made inparliament, above all those that indirectlyor directly affect employees’ material and

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social position. Such a practice has beenintroduced in Croatia and is described in itsnational report as follows:

Parliamentary Committees

The amendments to the Rules ofProcedure of the Parliament created thepossibility for the representatives of thesocial partners to participate in the work ofthe Parliamentary Committees for labour,health and social policy; for the economy,development and reconstruction; for statebudget and finances; for legislation.

According to the opinion of a trade unionleader, trade union representativesparticipating in the work of theParliamentary Committees represent wellthe positions and interests of theirorganisations. However, he also stressesthat the trade union does not systematicallyaddress the topics on the agenda of theParliamentary Committee. In addition,there is no established procedure for theconsultation between trade unionrepresentatives and the leadership of tradeunion organisations, nor the obligation toreport to the trade union bodies about thework of the committees. An additionaldifficulty arises from the manner of work ofthe committees. Namely, materials formany committee sessions arrive literally inthe last moment, so that the time forpossible consultations is very short.

Absence of systematic communicationbetween the representatives of the tradeunion and the bodies of organisations theyrepresent results, according to the opinionof one of the interviewed officials, in thefact that they act in these bodies as ‘freeshooters’. Due to this, it appears that socialpartners actually do not have theirrepresentatives in these committees.43

In addition, representatives of socialpartners in Croatia participate in the workof the following bodies:

� Governing Board of the CroatianEmployment Office

� Governing Board of the Croatian HealthInsurance Office

� Governing Board of the CroatianPension Insurance Office

� Governing Board of the CroatianOccupational Safety Office.

Romania has an exceptionally developednetwork of bodies in which social dialogueon specific economic and social issues isconduced. They include:

1. The Joint Consultative CommitteeEU – Romania.

2. The Consultative Commissions forSocial Dialogue within the Ministries.

3. The National Employment Agency.

4. The Consultative Councils of theDepartmental Employment Agencies.

5. The National House for Pensionsand Other Social Rights.

6. The National House for HealthInsurance.

7. National Council for Adults’Vocational Training.

8. The Council for Certification andOccupational Standards.

9. The Consultative Commissions forSocial Dialogue within the Prefectures.

10. The National Commission forPromoting Employment.

As this list shows, there are ten bodies thatcover all key areas affecting the economicand social position of employees plus aspecific one – the Joint ConsultativeCommittee EU – Romania, which is thedirect expression of the commoncommitment and an organisational form ofthe joint action of the social partnerstowards approximation of Romania to theEU. In order to acquire a comprehensivepicture about the content and the methodof work of all these bodies, we will give anexcerpt from the national report about theestablishment and the work of the NationalCommission for Promoting Employment:

The Law 76/2002 concerning theunemployment benefits and the stimulationof employment established the framework

43 Ibid., pp. 29, 34–5.

to create the national Commission forPromoting the Employment as a tripartiteinstitution, formed by the publicadministration representatives and thepresidents of the trade unions andemployers organisations, representative atthe national level. The commission submitsto the government attention strategies andpolicies to increase the level and quality ofemployment according to the programs ofeconomic and social development,establishes the directions for thedevelopment of the human resources atthe national level, in the different branchesand areas, ensures the harmonisation ofthe programs for the development ofhuman resources, makes suggestions forthe elaboration of laws concerning theemployment based on the social andeconomic development tendencies and onthe evolutions on the labour force market,makes suggestions for the initiatingpro-active actions to fight unemploymentby fiscal policies, structural adjustments,professional reconversion.

In the mining area there were a lot oftripartite structures created along the timeto solve the economic and social issues inthese underprivileged regions. TheGovernment Decision 167/1997 set up theCentral Tripartite Commission Government– Trade Unions – Employers in the MiningGeology Branch, to elabourate and monitorthe restructuring and modernisingprograms for the branch. The centralcommission elaborated programmes torestructure and modernise the mining andgeological industry, specific to the miningareas. The GD 69/1998 set up the NationalAgency for Developing and ImplementingReconstruction Programmes for the MiningArea, with attributions in applying thestrategy and the policy for reconstruction ofthe mining areas that have to berestructured. There was a Board thatfunctioned as a consultative body for thepresident, which was formed from threerepresentatives of ministries, trade unionsand employers.44

Besides the Social and Economic Council,the following bodies have been set up inAlbania to conduct social dialogue onindividual issues:

� Business Advisory Council (BAC)� The Social Insurance Institute (ISSH)� State Inspectorate of Labour� National Employment Service (NES).

Very characteristic is the concept of theState Inspectorate of Labour, which isdefined by law as a tripartite body. Moreabout this in the national report:

The State Inspectorate of Labour is also atripartite body and performs activities incompliance with the Law No. 798 of13.09.1995. The Inspectorate is a stateinstitution, which aims to ensure theimplementation of labour legislation. Toincrease the Inspectorate’s effectiveness,the Ministry of Labour and Social Affairsendorsed the creation of a ConsultativeCouncil with 14 members. This Councilrepresents these areas: Inspectorate ofHygiene (working conditions); Inspectoratefor Technical Security of Equipment andElectrical Installations; Institute for SocialInsurance; Committee of EnvironmentalProtection; Construction Police and twodelegates from the most representativeemployers’ and employees’ organisations.

The Consultative Council during the periodof its existence has displayed lack of clearand transparent endeavors from itsmembers and the respective institutions tocarry out the improvement of legaldispositions in force. This has led to thesituation where the Council de facto actson the basis of special agreements/actswith each of the component institutions,thanks to the mutual understanding, aswith the Institute of Public Health,Construction Police, or the Directorate ofTax and Taxation, etc. On the other hand,the functioning of this Agreement/Act hasled time and again to a superficialperformance, and the latter finally has everbeen weakening the legitimate role of theCouncil, up to its physical non-existence.45

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45 National report of Albania, p. 14.

An intensive process of the establishmentand development of special tripartiteinstitutions for certain areas of activity isalso under way in Bulgaria. One of thesebodies is the National Council for WorkConditions.

The multiyear development of the socialdialogue in Bulgaria has naturally enrichedand lent variety to the architecture of theinstitutions within which it has been held.The recognised need to hold independentspecial dialogues on separate butcomprehensive and multifaceted issues ledto the transformation (in 1997) of thespecial council for working conditions at theNational Council for Tripartite Cooperation(NCTC) into an autonomous parallelnational institution for social dialogue aboutspecific issues of working conditions –National Council for Working Conditions(NCWC). Its membership is a mirrorreflection of its predecessor (i.e. theclassical participants in the social dialogue– the state, employers and trade unions –are represented in it). The principles ofaction at the National Council for WorkingConditions are synchronised with the rulesand traditions of the social dialogueestablished in the process of itsdevelopment.

An objective testimonial of the dialogue’slevel and quality within the National Councilfor Working Conditions is the drafting ofup-to-date legislation in this field, namelythe Safe and Healthy Working ConditionsAct drafted with the help of the socialpartners. The practice to have specialdialogues on relatively independent andimportant areas of industrial relations wasaccepted and officially adopted with thissame Act. Moreover, the functions of theNational Council for Working Conditionsexpanded and multiplied. Under the law,NCWC is already a standing body forcoordination, consultation and cooperationin developing and implementing thenational policy for providing healthy andsafe work conditions.46

Montenegro is also at the beginning of theestablishment of special tripartite bodies,as seen from its national report:

The new Employment Law, enacted on 15February 2002, establishes theEmployment Office, with the GoverningBoard consisting of 9 members:

� chairman and three members appointedby the Government,

� two members representing the tradeunion;

� two members from the employers’organisations;

� one representative of the employees atthe Employment Office.

The same law (Article 38 and further)defines the Workers’ Fund for the needs ofthe unemployed, whose jobs becomeclosed due to technical, economic ororganisational changes. The founders arethe Government, the Employers’Association and the authorised trade unionorganisation.

Establishment of tripartite structures thatwould govern the pension scheme and thehealth fund is envisaged as well.

In addition, representatives of the tradeunion and the Chamber of Commerce andIndustry are included in specialcommissions whose task is to make thelists of employees declared redundant innewly-privatised enterprises.

For the time being, the social partners donot participate in the decision-makingconcerning vocational education andtraining. This is an important factor for anyreform of this sector in order to ensureconsistent connection between the trainingand economic development and labourmarket.47

The process of emergence anddevelopment of specialised tripartitebodies, presented in these excerpts fromnational reports, confirms the fundamentalvalues and authentic meaning of socialdialogue. The sequence of evolution –trade unions – collective bargaining –social dialogue through social andeconomic councils – inevitably suggeststhe tripartite character of these specialbodies. It is unquestionable that these

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bodies have been founded by thegovernment on a legal basis. In this regardthey differ from the social and economiccouncils that have in an overwhelmingmajority of cases been founded on thebasis of agreement between socialpartners. Changed social circumstancesand the growing power of trade unions andadvantages already noted in practice haveurged governments to include therepresentatives of trade unions andemployers in all these bodies. This is just astep away from tripartism. Two forms ofsocial dialogue – social and economiccouncils and special tripartite bodies,emerged from two sources: agreement ofsocial partners and the law – becomecomplementary elements of a singleprocess.

The democratic character of this process isreflected in the fact that a much wider circleof people are included in the process ofdecision-making on important political,economic and social issues. This does notrefer only to members of these specialtripartite bodies, but to the representativesof the legislative and executive politicalpower, organs at different levels, membersand activists of workers’ and employers’organisations, a wide circle of people whoare in different ways and to a differentdegree involved in this process. The socialand economic councils and specialtripartite bodies are mechanisms throughwhich essentially new relations areestablished between these social groups.

The analysis of the content of work of thesocial and economic councils and specialtripartite bodies indicates that their contentoften overlaps: that these bodies addressthe same issues. This imposes the need toanalyse the relationship between these two

groups of bodies from that viewpoint aswell. The easiest, but also the riskiest,would be to regard this phenomenon in asimplified fashion, as unnecessaryduplication of the same job. This process isonly taking its first steps in the countries ofsouth-eastern Europe. As always in similarsituations, it is necessary to wait for socialpractice to confirm certain solutions and toprovide answers to disputable questions.In this regard, practice so far points tosome open issues and problems thatspecial tripartite bodies and social andeconomic councils will face in theforthcoming period.

The first among them is the question of themutual relationship between social andeconomic councils and special tripartitebodies. Since these two kinds of bodiesoften discuss and take stands on the sameissues, there is a risk of establishing arelationship of subordination andsuperiority between them. This would callinto question the very meaning of thesespecial tripartite bodies. The answer to thisquestion can be found in thecomprehensive approach, in the treatmentof the social and economic councils andspecial tripartite bodies as complementaryelements of the same social process andon this basis – the strategy of theirnetworking.

This approach could at the same time erecta successful barrier against two otherpotential risks – that of excessiveinstitutionalisation, whose inevitable effectis that organisational forms could smotherthe essence of a social process andrelationship, and that of fragmentation,which could jeopardise the very essence ofsocial dialogue as an essentially newquality in political and social relations.

11. THE SETTLEMENT OF

INDUSTRIAL CONFLICTS

Industrial and social conflicts represent anextremely complex and contradictory areain social relations that mirror all otheraspects of the transition process. Industrialand social conflicts are a direct obstacle toeconomic, political and social reforms. Inother words, one of the reliable indicatorsof the success of the transition process isthe volume and intensity of industrial andsocial conflicts. This is always indicative ofthe high or critical level of socialcontradictions and unsuccessful reforms,that is, their too steep price which thewage-earning population, as a rule, isunable to pay. On the other hand, low levelof social and industrial conflicts is aregular indicator of the success of thetransition process and its positive effectson the wage-earning population in societyas a whole.

In the theory and practice of transition,there is no doubt that one of the keyelements of the strategy of all societiesundergoing transition is the prevention ofindustrial and social conflict. That strategymust encompass the analysis of thecauses of social and industrial conflict,

identification of problem areas whereindustrial and social conflicts break outmost frequently and with the greatestintensity, promotion of social dialogue,development of the mechanisms andencouragement of social actors to resolvecollective industrial and social conflictspeacefully, and in the case of outbreak ofopen conflicts – the most efficient means ofsettling them. A strategy for preventingsocial and industrial conflicts is of vitalimportance in the countries ofsouth-eastern Europe bearing in mind thatthese are predominantly conflict-riddensocieties.

The relationship between social dialogueand social and industrial conflict can besymbolically and actually expressed in asingle sentence: social dialogue, i.e. socialharmony versus social and industrialconflict. The entire process of theestablishment and development of socialdialogue mechanisms could be regardedas preventing industrial and social conflict.Conflict and dialogue, two facets of thesame industrial process, are profoundlyinterrelated and interconnected. This is,

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among other things, the consequence ofthe interrelationship and interactionbetween industrial and social conflicts. Thismeans that in every real industrial conflict,wider social causes can be detected inaddition to the most direct ones. At thesame time, wider social conflict represents,inter alia, the result of specifice, individualindustrial conflicts.

It is certain that south-eastern Europeancountries will continue to be highlyconflict-ridden societies for a long time tocome. This is caused by objectiveeconomic, political and socialcircumstances in which these societiesdevelop.Because of this, the endeavours ofsocial actors should focus on eliminating ormitigating the causes, and/or reducing theintensity,of social and industrial conflicts.The main aim and the measure of thesuccess of this activity is preventingindustrial and social conflicts from reachinga critical point where stability is at stakealong with the survival of the entire socialorder. This means that all three socialpartners – government, employers andtrade unions – are faced with a newchallenge: the need for crisis management,that is, management of industrial and socialconflict. That challenge will be everincreasing in the forthcoming period. Thespecifics of this problem are reflected in thefact, confirmed by the experience of the EUand successful transition countries, thatsuccessful management of social andindustrial conflict is possible if undertakensimultaneously and jointly by all threesocial partners.

It may sound contradictory, but in all theobserved countries the means of resolvingindustrial and social conflicts is the subjectof social dialogue. This confirms thestrength and essential meaning of socialdialogue. Agreement between socialpartners about the way possible mutualconflicts are settled is certainly thefoundation for a peaceful resolution ofconflicts.

That need and conviction of social partnersis expressed in the establishment ofnumerous institutions for the peacefulresolution of industrial and social conflicts.Institutions for the peaceful settlement of

industrial conflicts are established in twomain areas:

1. In the collective bargaining process.2. As a separate form of organisation and

activity of the social and economiccouncils.

From the analysis of documents thatregulate these issues it is possible to makea conditional division of labour in this area.Bodies dealing with conflict resolutionwithin the system of collective bargainingfocus on industrial collective labourdisputes and their actual resolution. Thesocial and economic councils also dealwith the settlement of collective industrialconflicts, but their emphasis is onsystematic issues, on the development ofstrategies for resolving collective industriallabour disputes. At the same time, thesocial and economic councils at thenational level also address the causes andmeans of settling broader social conflicts.Of course, it is necessary to bear in mindthe organic connection between specificindustrial conflicts and wider socialconflicts, which is not always visible, butwithout that connection it is not possible tounderstand the nature and character ofindustrial and wider social conflicts, as aprecondition for their efficient settlement.

A common denominator for all theobserved countries in south-easternEurope is that all social and economiccouncils at the national level devoteexceptional attention to the resolution ofindustrial and social conflicts.

It seems logical that the greatest attentionin the documents and practice is devotedto the establishment and functioning ofmechanisms for the resolution of thosecollective industrial disputes that are mostfrequent in practice and which carry thegreatest degree of social risk. They includeconflict of interests and legal disputes inthe collective bargaining process andimplementation of collective agreements,prevention of strikes, as the most radicalform of industrial conflict, and relationsbetween social partners during a strike.The common denominator of all thesemechanisms is voluntary undertaking ofpeaceful conflict resolution by the social

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actors. The national report of Bulgariahighlights this in the following way:

Collective labour disputes are an inevitablephase in the development of industrialrelations both in society and in a particularenterprise. It is a manifestation of the clashof interests of the parties in the labourrelations.

The major tool for resolving them is theCollective Dispute Resolution Act (CDRA).Passed in the very first days of transition(March 6th, 1990) it put the beginning ofBulgarian collective labour law. This Actdetermined the parties in the collectivedisputes and clarified a number of newlegal issues. It is the fist document toregulate the various ways and therespective procedures for resolvingcollective disputes – immediatenegotiations, arbitration, strike.

The CDRA points to the voluntarysettlement of collective disputes as thebasic method for their resolution. That iswhy immediate negotiations betweenemployees and employers, or betweentheir representatives, according to aprocedure determined freely by them, areproposed as the most acceptable form.

This was also the regulation of the labourarbitration – in its voluntary and mandatoryform. Unfortunately, this significantopportunity has been used extremelyrarely. On the one hand, this is probablydue to the lack of tradition and, on theother, the insufficiently well-regulatedprocedures and legal safeguards forsettling the disputes in this way.48

In the analysis of the organisation and workof the special bodies and the role of socialand economic councils in the settlement ofcollective industrial conflicts we should beaware that separate bodies within whichcollective labour disputes are settledpeacefully, as well as the social andeconomic councils, are only a part of thissystem. An important role in the settlementof collective industrial conflicts is played bycourts, as indicated by the followingexcerpt from the national report ofRomania:

The conflicts of rights are conflicts relatedto closure, execution, modification,suspension and cease of the individualwork contracts. Specialised courts of lawsolve the conflicts of rights. TheEmergency Ordinance 20/2002 formodification and completion of the Law92/1992 for organising the judging courts oflaw regulates the framework of disputessettlement. As according to this normativeact, court of law formed by two judgesassisted by two consulting magistratesjudge in the first instance with celerity theprocesses on work conflicts. Theconsulting magistrates participate atdeliberations with consultative vote. Theirseparate opinions or a separate opinionare specified in the court’s decision. Theminister of justice appoints the consultingmagistrates on a four-year period at theEconomic and Social Council’s proposal.The Ministry of Justice and the Economicand Social Council propose and establishthe terms and the procedures for theEconomic and Social Council’s candidates’selection and proposal for them beingnominated by the minister of justice. Theclaims for disputes settlement are judged inemergency regime, the judging deadlinescould not be longer than ten days.49

The national report of Bulgaria points outthat the settlement of collective industrialconflicts through legal action is the costliestalternative from all aspects. This forced thesocial partners to do their best to establishand develop peaceful methods for conflictresolution.

In recent years, the employers and thetrade unions have realised that the courtprocedure for collective dispute resolutionis, on the one side, a considerablyexpensive method and, on the other, it putsthe fate of the dispute in the hands of thecourt that often has no sufficiently objectiveinformation about the prime causes of thedispute. That is why significant efforts havebeen made by the major representativeemployers’ and employees’ organisationsto establish the rules and procedures forvoluntary arbitration. In relation with that, in1999 the National Bipartite Agreement wassigned and was officially supported by theMinistry of Labour and Social Policy by



providing the necessary facilities andtechnical assistance. Again, however, wemust note that this attempt to applyarbitration was not successful.50

The intensity of the use of mechanisms forthe resolution of collective industrialconflicts is also an indicator of a number ofaspects of the mutual relationship betweensocial conflict and dialogue. On the onehand, the intensity of the use of thesemechanisms speaks about the conflictingcharacter of society and industrial relations,but also about the confidence in thesemechanisms and thereal readiness of thesocial partners to solve conflicting issues ina peaceful way. The national report ofCroatia illustrates this with the data on thenumber of cases of collective industrialdisputes that have been peacefullyresolved before the competent bodies.

There are no official statistics on thenumber of conciliation procedures carriedout. On the basis of the data procured fromtrade unions and the Ministry of Labourand Social Welfare, it can be concludedthat since 1 January 1996, hence since thebeginning of the implementation of theLabour Law in the Republic of Croatia,about 240 conciliation procedures havebeen instituted, or about 40 per year on theaverage. Out of this number, 80conciliation procedures have been initiatedin 2001. This increase can be attributed tothe amendment of the Labour Lawintroduced that year, which defined theright to strike due to unpaid wages (90% ofthe conciliation procedures were institutedfor that reason).

Out of the mentioned number, about 60%of cases have been resolved by theagreement of the parties in dispute. Tradeunions resorted to strike as a means ofpressure only in very few of the remainingcases, where the conciliation procedurefailed to result in the reconciliation of theconflicting requests.51

The other side of the analysis of themechanisms for peaceful resolution ofcollective industrial conflicts is the intensityand dynamics of these conflicts. Accordingto plain reason, the efficiency of thesemechanisms is measured by the numberand intensity of the conflicts. Thus, thenumber of industrial and social conflictsshould decrease with the growingefficiency of these mechanisms.

However, it turns out in practice that thisproposition is not always correct. Althoughthe positive tendency of establishing andexpanding the network of institutionsdealing with peaceful resolution ofcollective labour disputes is obvious fromthe national reports, the analysedsouth-eastern European societies continueto be highly conflict-ridden. The numberand intensity of industrial and socialconflicts in some of these countries remainat very high levels, while in others they areeven on the increase.

Yet, we should not jump to the conclusionthat the mechanisms of peaceful resolutionof collective industrial disputes areinefficient. The reason can be found in thefact that contradictions and problems facedby countries of south-eastern Europe aretoo complex, resulting in exceptionallydifficult social and economicconsequences, which generatecontinuously high levels of social andpolitical discontent and conflict. In otherwords, social conflicts cannot be eliminatedjust by the development of mechanismsfor peaceful resolution of collectiveindustrial and social conflicts, but requirethe permanent elimination of the causesthat produce these conflicts. The practiceconfirms that this goal is best achievedthrough social dialogue, which provides anew dimension to social dialogue in thepolitical and social processes as a whole.

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12. FINAL CONSIDERATIONS

Europe is entering a new phase of itspolitical, economic and social development.One of the unquestionable characteristicsof this new phase is social dialogue, uponwhich social peace, economic and politicalstability of these countries already rest. Butsocial peace is also a strategicallyimportant goal to which all social partnersaspire – political authorities, trade unionsand employers. As human history hasconfirmed, there is never too much peace,so contemporary history and ongoingprocesses in both the EU and insouth-eastern Europe confirm that there isnever enough social peace. Theexperience of the EU countries, wheresocial dialogue has achieved a high level,shows that it is a long-lasting, dynamicsocial process and that the achieved levelof social peace and social dialogue opensup the way for new steps, for new phasesin the development of social harmony andnew forms of social dialogue. This processlargely similar to a modern computergame, where the player goes from simpleto more and more complex problems andwhere he first has to open one door to getat another.

South-eastern European countries are anintegral, inevitable part of this process, thenew phase in the development of theEuropean Union. This arises from thecontent of contemporary economic andpolitical processes in Europe andworldwide, where the integrativecomponent is increasingly more apparent.In other words, rational political andtheoretical thought cannot, at least not in arational and substantiated way, imagine theEurope of the future as a continent whereonly the EU is based on economic andsocial prosperity, social peace, stability andsocial dialogue, and other parts of Europeon predominant contradictions, obstacles,industrial conflicts. On the contrary, Europeas a whole can have steady and stabledevelopment only if it is based on the sameprinciples as the EU is today. The currentsituation and the present differences in thedevelopmental level of all aspects of thepolitical, economic and social developmentbetween the EU countries andsouth-eastern Europe in this context canbe treated only so that in the presentcircumstances the more successful andstronger actors of this unique process – the

EU countries – pave the way and help theweaker partners including, among others,the countries of south-eastern Europe, toproceed faster, more efficiently and safelytowards these common goals. Because ofthese reasons, establishment anddevelopment of social dialoguemechanisms is a common goal and one ofthe common denominators of the politicaland social processes in the EU andsouth-eastern European countries. In thisregard, social dialogue will certainlyincreasingly assume the role of a bridge, ofan integrating factor in linking the EU andthe countries of south-eastern Europe. Itcan reasonably be expected that socialdialogue will be an efficient vehicle indefining the elements of a commonstrategy and a way towards a joint,integrated Europe and in this framework ofthe gradual reduction of differences in allaspects of political, social and economicdevelopment.

In order that the social dialogue canexercise its main social role and functionsof an integrating and developmental factor,it is necessary to define commondenominators of social dialogue in EUcountries and the countries ofsouth-eastern Europe. These commondenominators, this connective tissue andits universal character are fundamentalvalues and the true meaning of socialdialogue:

� A new approach to democracy, humanliberties and rights, an essentially newapproach to the process of politicaldecision-making and the possibility forreal participation and influence of thewidest circle of employees and citizensin this process.

� Tapping the creative energy, knowledgeand initiatives of a much wider circle ofpeople and organisations.

� The principal measure of the value andefficiency of the social dialogue isreflected in the extent to which itcontributes to the upgrading of thepeople’s quality of life.

For many decades now social dialogue inthe EU countries has proved in practice itspower, meaning and advantages comparedwith other mechanisms for making relevant

political and other decisions in society. Thevery fact that social partners, particularlytrade unions in south-eastern Europeancountries, treat the establishment anddevelopment of social dialogue as astrategically important issue speaksvolumes about the values of socialdialogue. The national reports point outthat social partners have high expectationsfrom the introduction and functioning ofsocial dialogue mechanisms. Theseexpectations are often much greater thanthe real social power and influence of thesocial and economic councils in theresolution of economic and social problemsand contradictions. In other words, in allthe analysed countries of south-easternEurope social and economic councils areconceived as consultative and advisorybodies, whose power and influence arebased not on the force of political power,but on the reputation and authority of thesebodies and their members individually.

This essence of social dialogue makes theprocess of the establishment andfunctioning of its mechanisms exceptionallycomplex and contradictory. Obviously, it ismuch harder to achieve consensus amongthe social partners, establish their commoninterest at least at the minimum level, thenmake an important decision, whichultimately affects everyone, by outvoting.Social partners tend to achieve consensusaware of the fact that no social partner canachieve its individual interests alone,without the cooperation and harmonisationof these individual interests with theindividual interests of the other two socialpartners. That is the motive force thatdrives social partners to accept the mainprinciples of social dialogue –voluntariness, autonomy of will, mutualconfidence and tolerance.

In principle, social dialogue is based on therelatively balanced power of socialpartners. Disproportionate prevalence ofone of the social partners breeds the realrisk that one social partner may abandonthe principles of social dialogue, or abideby them only formally, while in reality it mayimpose its social interests using othermeans. Therein lies one of the mainrestrictions of social dialogue in thecountries of south-eastern Europe where

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the actors in social dialogue – primarilytrade unions and employers’ organisations– have not yet been fully defined andwhere unevenness of the power of thesocial partners is quite pronounced. Fromthis fact doubts about the role of thegovernment in social dialogue largely arise.National reports often stress thepredominant role of the state insocialdialogue mechanisms. The source of thatpredominance lies in the generallyoveremphasised role of the state intransitional changes. The development ofthe the social dialogue mechanism cancontribute towards gradually reducing thisoveremphasised role of the state, thoughthe role of the state in creating the legalframework and the entire socialenvironment for social dialogue isirreplaceable. This is confirmed by the factthat an exceptionally large segment ofsocial dialogue in the analysed countries ofsouth-eastern Europe focuses on issues oflegal regulation, that is, on the creation of alegal framework for the new socialenvironment.

Connected with this is the tendency tolegally regulate and protect by force of lawas much of the social dialogue and itsmechanisms as possible. This is in factcontradictio in adjecto, because it is incontradiction with the principle ofvoluntariness and autonomy of will of theactors in social dialogue. However, it alsoreflects the real imbalance of powerbetween social partners and a tendency toreplace social dialogue by the force of law.That, of course, does not call into questionthe need for the establishment of a legalframework for social dialogue, but in doingthis it is necessary to determine preciselythe dividing line beyond which legalprotection loses its principal meaning.

In this regard it is necessary to analyse theopinions presented in some of the nationalreports, that the legal framework of socialdialogue is not an obstacle; it is sufficient,but is not respected in practice. Of course,legal provisions in areas like socialdialogue always have a pronouncedheuristic tone. In other words, legal normsencompass not only the actual situation,but also anticipations of a future desiredsituation. This should be an incentive and a

guideline for the actors in social dialogue toaspire to in carrying out such a normativemodel in practice. But, if the differencebetween the real and the normative is toobig, the legal norm loses its meaning andturns into an obstacle, for it introducesconfusion, discourages the participants insocial dialogue and fails to accomplish itsmain function – to provide effective legalprotection for the foundations of socialdialogue.

One of the biggest, objective obstacles tothe establishment and development ofsocial dialogue in south-eastern Europeancountries is the slow pace and insufficientefficacy of economic reforms and theunexpectedly high social cost of transition.This high social cost primarily and mostprofoundly effects very many of thewage-earning population. On the one hand,the high social cost of transition is astanding, real source of discontent andsocial conflict. On the other, generallyunfavourable economic opportunities andthe exceptionally high cost of transitionrestrict the possibility of agreement amongthe partners in social dialogue. In otherwords, tolerance underlying social dialogueimplies a greater or lesser softening of thesocial requests compared with the initialrequests. But this also implies a realisticmaterial basis for the concessions, which isoften missing, particularly on the part of theworkers, where every drop in wages mostdirectly affects their vital interests.

Great variety in the degree of developmentof certain forms and levels of socialdialogue is a significant obstacle for thedevelopment and exercising of the role andfunctions of social dialogue. In making thisstatement, we have in mind that socialdialogue is a complex process, whichconsists of many forms and mechanismsthrough which it is carried out. All theseforms of social dialogue must becoordinated and united into a singlewholethat is to say,. the network ofinstitutions of social dialogue must be builtat the national level. A prerequisite for thisis a relatively uniform degree ofdevelopment of the institutions and formsthrough which social dialogue is carriedout.

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12. FINAL CONSIDERATIONS

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Development of the network of institutions,strengthening of the role and social powerof social dialogue at the national level is atthe same time the first condition for theestablishment of social dialogue in theregion. Of course, the establishment anddevelopment of social dialogue depends onthe overall development of the economicand political relations between thecountries of the region, because thatcooperation, as well as the anticipatedprocesses of economic and technologicalintegration provide the substance to socialdialogue. However, on the other hand, theestablishment of certain permanent,systematic forms of social dialogue mayact as an incentive for accelerateddevelopment of the economic,technological and political ties in theregion. The first steps in this direction havebeen made through the Action Plan toPromote the Culture and Practice of SocialDialogue in the South-eastern EuropeanRegion. The actors in social dialogue –representatives of the political authorities,

trade unions and employers, with theassistance and cooperation of experts fromEU institutions, presentation and analysisof the experiences of the EU countries, gota closer insight into the course of theestablishment and development of socialdialogue in these countries, exchangedexperiences and launched the first jointinitiatives. Indisputable is the need tocontinue the systematic, organised work onthis project, towards the achievement ofthe next, more complex stage ofdevelopment, that is, setting thegroundwork for the regional network ofsocial dialogue. Social dialogue as adynamic, living social process requires thefull-time, systematic engagement of allsocial actors in their upgrading. Such aposition was supported by all participantsof the seminar held within the framework ofthis project in Bucharest in June 2002. Inthe final document they proposed a rangeof forms for regional cooperation in thebuilding and development of socialdialogue at national and regional levels.

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SOCIAL DIALOGUE IN SEE

SEMINAR OF BUCHAREST17–18 JUNE 2002

Summary of the conclusions from the three working groups

1. ENTREPRENEURIAL ASSOCIATIONS

For the realisation of a successful social dialogue, social partners need to:

� Develop a network of social partners in order to share and disseminate information onthe current state of the play and on the mechanisms used in SEE countries. The firststep would be to identify the already existing regional networks such as the SEEEF(SEE Employers Forum) and to become members of it.

� Creation of a e-discussion forum linking via e-mail the Entrepreneurial Associationsparticipant to this project.

� Exchange of experience of good practices in the social dialogue.� Identify the additional needs of the Entrepreneurial Associations coming out from the

comparisons with the above-mentioned best practices.� Technical assistance for improving the competence and possibilities of the social

partners.� Training of social partners on the mechanisms for social dialogue, collective bargaining

techniques and negotiation skills.� Training on Life Long Learning issues.� Entrepreneurial Associations should play a more proactive role in developing the

Poverty Reduction Strategy Paper (PRSP).

2. TRADE UNIONS

The working group recommends to:

� Analyse in depth the differences between d\bi- and tri-partism.� Comparative analysis of the legal framework for social dialogue in Europe.� Debate on the issue of the representativity of the TU and Entrepreneurial Associations.� Improve cooperation between participant organisations.� Transfer theory into reality.� Organisation in each country of the national seminars managed by local expert teams

to be built up.

Among these initiatives and proposals for the development of social dialogue at thenational and regional plan education has exceptional, strategic importance. In fact, theentire past course of the establishment and development of the social dialogue in thecountries of South-eastern Europe can be treated as a specific form of education aboutsocial dialogue, because all social partners were making their first steps in this area.

However, this does not refer only to the education of those who are directly involved insocial dialogue – members of the social and economic councils, etc. Social dialogue, as anew form of democracy, should be accepted by the broader public. This means that it isnecessary to promote new political culture of tolerance, mutual confidence, consensus thatis reached through social dialogue.

Finally, when analysing the state of social dialogue in Europe as a whole and insouth-eastern European countries we can make the following symbolic comparison. Thestate of social dialogue resembles a train. The first carriages of that train (EU countries)are modern, safe, fast andcomfortable. The last carriages (SEE countries) are slow, shaky,break down often and slow down the entire train. The problem is that the whole train(social dialogue) must come to the railway station with all the carriages at the same time.

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