Call for end of large tripartite collective labour contracts
EVA’s Korkman recommends lower initial pay for young workers
|
|
|
Sixten Korkman, Managing Director of the Finnish Business and Policy Forum (EVA) says that instead of an overall national pay increase, companies should have more leeway in agreeing on wages at individual workplaces, and even on a personal level with individual employees.
According to Korkman, the system of tripartite collective bargaining agreements involving employers’ groups, labour unions, and the state could become obsolete.
Under Korkman’s vision, the role of labour market organisations would be mainly to agree on the basic rules of the game for local pay negotiations.
On Friday, Korkman published a report on the collective bargaining system, the labour union movement, and tripartite cooperation. In the report Korkman emphasises that the views expressed are his own and that the board of EVA is not involved.
Korkman has previously served as Director-General of the Economics Department of the Ministry of Finance.
Korkman feels that the current system underscores wage moderation, even though wages and salaries should be much more than just an expense for the employer. He feels that wages should serve as an incentive. This means that working better should allow an employee to earn more money.
"This requires a readiness for possible increases in differences in income", Korkman writes.
Korkman feels that while national incomes agreements have focused on the needs of the Finnish economy, the needs of companies have not been considered. He feels that wages should fluctuate, depending on which sectors have shortages of labour, and which have a surplus.
He also emphasises that the next government should be allowed to either reduce taxes, or refrain from doing so regardless of the incomes agreements. In his view, political commitments to tax decisions based on collective bargaining agreements could excessively tie the government’s hands in finance policy decision-making.
To encourage hiring of young people, Korkman proposes allowing employees to pay lower wages to young employees starting work. He quotes figures from the OECD according to which minimum wages of those aged 20 to 24 are higher in proportion to average wages in Finland than in many other EU member states.
In his report Korkman also criticises the power wielded by the tripartite system. As he sees it, interest groups have been given too much power, especially with respect to social welfare. Korkman hopes that the government and Parliament will shoulder their responsibility for developing society, and that they would not leave it in the hands of labour market organisations alone.
In addition to the criticism, Korkman also had praise for the system. He noted that in countries with strong labour movements, such as Finland, legislation on job security is not as strict as in countries with weak labour unions; in Finland, such issues are dealt with in collective bargaining.
"Contract negotiations with organisations is more sensible than strict legislation."
As he sees it, the collective bargaining system between labour unions and employers generally works well.
He also praises the role that the unions have in maintaining industrial peace.
However, he feels that the right to strike is currently too extensive. He is especially critical about the practice of solidarity strikes and the occasional illegal strikes, and says that the possibility of compulsory arbitration should be considered.
Helsingin Sanomat
|
| 26.3.2007 - TODAY |
 Call for end of large tripartite collective labour contracts
|
|
