(1)

The Council, in its Conclusions of 24 October 2019, on ‘The future of work: the Union promoting the ILO Centenary Declaration’ encourages Member States to continue their efforts to ratify and apply up-to-date ILO Conventions and Protocols. The Council also calls upon the Member States and the Commission to enhance social dialogue at all levels and in all its forms, including cross-border cooperation, in order to ensure active participation of social partners in shaping the future of work and in building social justice, including through the effective recognition of the right to collective bargaining and through a reflection on adequate minimum wages, whether statutory or negotiated.

(2)

In the 2016 Joint Statement on the New Start for Social Dialogue signed on 27 June 2016 by the Commission, the Netherlands Presidency of the Council and the European social partners, cross-industry and sectoral social partners at Union level committed to continue efforts and assess the need for further actions in their respective social dialogues to reach out to affiliates not yet covered in Member States and to improve the membership and representativeness of both trade unions and employers’ organisations.

(3)

Principle 8 of the European Pillar of Social Rights states that the social partners are to be consulted on the design and implementation of economic, employment and social policies according to national practices. They are also to be encouraged to negotiate and conclude collective agreements in matters relevant to them, while respecting their autonomy and the right to take collective action. The Pillar of Social Rights also states that support to increase the capacity of the social partners to promote social dialogue is to be encouraged. The Porto Social Commitment (1) further called on all relevant actors to promote autonomous social dialogue as a structuring component of the European social model and to strengthen it at European, national, regional, sectorial and company level, with particular emphasis on ensuring an enabling framework for collective bargaining within the various models in Member States.

(4)

In its Resolution on a European Pillar of Social Rights of 19 January 2017, the European Parliament stresses the importance of the right of collective bargaining and action as a fundamental right enshrined in Union primary law. The European Parliament also expects the Commission to step up concrete support for strengthening and respecting social dialogue at all levels and sectors, in particular where it is not sufficiently well developed, while taking into account different national practices. In its Resolution on employment and social policies of the euro area of 10 October 2019, the European Parliament states that social dialogue and collective bargaining are key to designing and implementing policies that can improve working conditions and terms of employment, and calls for a coordinated Union initiative to extend collective agreement coverage to platform workers. The European Parliament also calls on Member States, where necessary, to strengthen opportunities for collective bargaining.

(5)

Guideline 7 of Council Decision (EU) 2022/2296 (2) calls upon Member States to, among other things, work together with the social partners on fair, transparent and predictable working conditions, balancing rights and obligations, and to ensure the timely and meaningful involvement of the social partners in the design and implementation of employment, social and, where relevant, economic reforms and policies, including by supporting increased capacity of the social partners. That Guideline also calls on Member States to foster social dialogue and collective bargaining and to encourage the social partners to negotiate and conclude collective agreements in matters relevant to them, fully respecting their autonomy and the right to take collective action. The annual growth survey for 2019 (3) recalls that in a context of declining collective bargaining coverage, policies enhancing the institutional capacity of social partners could be beneficial in countries where social dialogue is weak or has been negatively affected by the economic and financial crisis. The 2022 annual sustainable growth survey (4) states that the systematic involvement of social partners and other relevant stakeholders is key for the success of economic and employment policy coordination and implementation. While in some Member States, the social partners play a significant role and are suitably involved in policy making and implementation, several country-specific recommendations have been issued in the context of the European Semester to other Member States in relation to the improvement of social dialogue and on involving of social partners in the design and/or implementation of reforms.

(6)

The Commission announced, in its European Pillar of Social Rights Action Plan (5), an initiative to support social dialogue at Union and national level. That Action Plan also underlined that social dialogue at national and Union level needs to be reinforced and called for strengthened efforts to support collective bargaining coverage and prevent social partners’ membership and organisational density from decreasing.

(7)

Social dialogue, including collective bargaining, is a crucial and beneficial tool for a well-functioning social market economy, driving economic and social resilience, competitiveness, stability and sustainable and inclusive growth and development. Social dialogue also plays an important role in shaping the future of work, taking into account particular trends in globalisation, technology, demography and climate change. Member States with robust frameworks for social dialogue and a wide coverage of collective bargaining tend to have more competitive and resilient economies.

(8)

Experience shows that social dialogue contributes to effective crisis management. Economies were more resilient in the aftermath of the 2008 crisis whenever social partners were able to manage and adapt collective bargaining structures at an early date. The recent COVID-19 crisis has shown that social dialogue is an essential tool for balanced crisis management and for finding effective mitigation and recovery policies. Beyond the humanitarian crisis, the unprovoked and unjustified war of aggression of the Russian Federation against Ukraine has led to unprecedented food and energy price increases. The social partners play an important role in responding to some of those challenges, particularly with regard to integrating the people fleeing the war in Ukraine as well as other conflicts into the Union’s labour market, and to finding sustainable solutions to adjusting wages and collective agreements.

(9)

Ongoing technological shifts, increasing automation and the green transition to climate neutrality are moving rapidly throughout the economy, with varying impacts across sectors, occupations, regions and countries. Social partners have a vital role to play in helping to anticipate, change and address, through dialogue, negotiation and joint action where relevant, the employment and social consequences of the challenges of economic restructuring and the ongoing twin transitions. In the context of the European Green Deal and the RePowerEU Plan, the Council Recommendation on ensuring a fair transition towards climate neutrality (6) invites Member States to adopt and implement, in close cooperation with social partners as relevant, comprehensive and coherent policy packages, while pursuing a whole-of-society approach and making optimal use of public and private funding.

(10)

Social dialogue arrangements and processes vary between Member States, reflecting their respective histories, institutions, and economic and political situations. An effective social dialogue implies, among other things, the existence of industrial relations models in which the social partners can negotiate in good faith and exercise autonomously their practices of collective bargaining and employee participation. Among the enabling conditions for a well-functioning social dialogue are the existence of strong, independent trade unions and employers’ organisations with the appropriate technical capacity; access to relevant information necessary to participate in social dialogue; a commitment on the part of all parties to engage in social dialogue; respect for the fundamental rights of freedom of association and of collective bargaining, the availability of appropriate institutional support and the respect for the autonomy of social partners.

(11)

Social dialogue encompasses tripartite and bipartite consultation and negotiation, in the private and public sector, at all levels, including dialogue at cross-sectoral, sectoral, enterprise level, or at national, regional or local level. National tripartite social dialogue brings together government, workers and employers to discuss public policies, laws and regulations and other decisions that affect the social partners. Tripartite consultations can ensure greater cooperation between the tripartite partners and build consensus on relevant national policies. A tripartite approach needs to build upon a strong bipartite social dialogue. In order to improve tripartite processes, it is key that governments increase the transparency of policy making, including policy making concerning the quality and labour market relevance of training opportunities.

(12)

Bipartite negotiation, in particular collective bargaining, takes place between workers’ and employers’ organisations as defined by national law or practice. A workers’ organisation is generally a trade union, formed by the association of workers or of other trade unions, or both, constituted for the purpose of furthering and defending the interests of workers, in accordance with national law and/or practice. An employers’ organisation is an organisation whose membership consists of individual employers, other associations of employers or both, constituted for the purpose of furthering and defending the interests of its members, in accordance with national law and/or practice.

(13)

According to the Workers’ Representatives Convention 135 of the International Labour Organisation, currently ratified by 24 Member States, worker representatives can be persons who are recognised as such under national law or practice, whether they are trade union representatives, namely, representatives designated or elected by trade unions or by members of such unions; or elected representatives, namely, representatives who are freely elected by the workers of the undertaking in accordance with provisions of national laws or regulations or of collective agreements and whose functions do not include activities which are recognised as the exclusive prerogative of trade unions in the country concerned. Where both trade union representatives and elected representatives exist in the same undertaking, such representation should not be used to undermine the positions of the trade unions concerned or of their representatives. Cooperation between the elected representatives and the trade unions concerned or their representatives should be encouraged.

(14)

Mutual recognition of the social partners and the statutory recognition of trade unions and employers’ organisations by the authorities of each Member State are both key to a successful collective bargaining framework, provided employers and workers are able to choose freely the organisation or organisations which will represent them. In some Member States that recognition is limited to those organisations that fulfil specific representativeness criteria. Such criteria should be objective and proportionate and established in consultation with the social partners. They should be assessed under an approval process that is open and transparent and which does not impede the full development of collective bargaining. In the absence of trade union representation at enterprise level, collective agreements can be negotiated and concluded by the representatives of the workers who have been freely elected and authorised in accordance with national law or practice.

(15)

Collective bargaining can cover issues related to working conditions and terms of employment, including wages, hours of work, annual bonuses, annual leave, parental leave, training, occupational safety and health as well as other matters relevant for the social partners. Collective bargaining is therefore particularly relevant to preventing labour conflicts, improving wages and working conditions and reducing wage inequality. Collective bargaining is a crucial tool to help workers and employers adapt to the changing world of work. It is also crucial to shaping the design and definition of new labour protection elements, such as the right to disconnect from work, or to improving existing ones, such as equal opportunities, protection against violence and harassment at work, training and life-long learning, improving work-life balance and addressing mental health challenges. Collective bargaining also has a key role to play in addressing the impacts of unexpected crises, such as the COVID-19 pandemic.

(16)

The functioning of a collective bargaining system is determined by a combination of features, such as the use of erga omnes clauses and extensions of collective agreements and their average length, the use of the favourability principle, the hierarchy of norms and the use of deviations practices, either from collective agreements or from law, as well as the density rates of trade unions and employers’ organisations. There is a broad diversity of approaches to erga omnes clauses and administrative extensions in the Member States in line with their respective laws and practices. A well-functioning collective bargaining system includes respect for the autonomy of social partners, procedures for cooperation, information sharing and the resolution of disputes between parties.

(17)

Collective bargaining can take place at different levels. Bargaining can be highly decentralised, taking place mostly at enterprise level, highly centralised, taking place at national level, or it can take place at intermediate levels, such as the sectoral or regional or local levels. Collective bargaining is increasingly taking place at more than one level. In some cases, sectoral or enterprise-level agreements follow the guidelines set by higher-level organisations, while in others, sectors or enterprises follow the standards set in another sector. Coordination across bargaining levels is therefore a key pillar of collective bargaining systems.

(18)

In most Member States, collective bargaining rates tend to be higher for employees on permanent contracts and for those working in larger enterprises or in specific sectors, such as the public sector. Generally, workers in small enterprises are less likely to be covered by collective bargaining agreements, as those enterprises often do not have the capacity to negotiate an enterprise-level agreement or because a union or other form of worker representation is absent from that workplace. Organising workers is particularly difficult in non-standard employment situations and most of the newer forms of employment suffer from a lack of representation. The considerable lack of representation of those types of workers can be attributed, on the one hand, to the cost of their being represented and, on the other, to flexibility in terms of time and place of work, making it difficult for worker representatives to organise this rather fragmented workforce. Increased capacity of the social partners would help them to further improve their contribution to policy making and create a more effective social dialogue and collective bargaining capacity. Capacity-building activities typically help social partners to improve the size of their membership base, including through the use of technology, the provision of new services and activities at school or university level, and their human and administrative capability, to promote their process-oriented capacities and to support their organisational development. Such activities include the provision of specialised training, technical and logistical support and funding. Capacity building is primarily a bottom-up process, dependent on the will and efforts of the social partners themselves who are best placed to identify their needs and indicate the measures they are already taking to strengthen their capacities. Those efforts can then be complemented and/or supported by public authorities and by making use of Union funding while respecting the autonomy of the social partners.

(19)

Some Member States have taken measures to support social dialogue and collective bargaining by broadening the opportunities for social dialogue; promoting the autonomy of social partners and respect for their contractual freedom; encouraging joint opinions, programmes and projects; engaging in the regular sharing of information; promoting negotiation training; providing for alternative dispute resolution mechanisms, such as conciliation, mediation and arbitration, and strengthening the protection of workers against retaliation or discrimination as a result of their involvement in collective bargaining activity.

(20)

In many Member States, social dialogue is, however, under pressure. While employer density remains relatively stable, even if on a declining trend in several Member States, trade union density has been declining on average across the Union. Moreover, the share of workers covered by collective agreements (the collective bargaining coverage) is low in most Member States and, despite several strategies being adopted by trade union organisations to extend their reach to non-standard forms of employment, that share has significantly declined over the past 30 years. In some cases, the existing rules might present gaps with a potentially detrimental effect on social dialogue. Those gaps can include: strict representativeness conditions; interference in the bargaining process or undue limitations on the subjects of collective bargaining; an improper delineation of economic sectors that precludes the formation of sectoral level collective bargaining structures; lack of enforcement of collective agreements; ineffective protections against anti-union discrimination; ineffective consultation procedures; a lack of constructiveness in negotiations, and a lack of capacity to bargain or to fully participate in consultation procedures.

(21)

The representativeness and the capacity of the national social partners also needs to be strengthened with a view to the implementation at national level of Union level autonomous social partner agreements. Particular attention should therefore be given to ensuring the putting into place of an enabling framework for social dialogue, including collective bargaining, and that national social partners have sufficient capacity to contribute effectively to the work of the Union-level social dialogue and to implementing, at national level, the framework agreements signed by social partners at Union level.

(22)

Directive 2014/24/EU (7) on public procurement, Directive 2014/25/EU (8) on procurement by entities operating in the water, energy, transport and postal services sectors and Directive 2014/23/EU (9) on the award of concession contracts require Member States to respect the right to organise and the right of collective bargaining following the ILO Convention 87 on Freedom of Association and the Protection of the Right to Organise and ILO Convention 98 on the Right to Organise and Collective Bargaining.

(23)

The Court of Justice of the European Union has ruled that a collective agreement which covers self-employed service providers can be regarded as the result of dialogue between management and labour if the service providers are ‘false self-employed’ and thus in a situation comparable to that of workers (10). The Court has also confirmed that ‘in today’s economy it is not always easy to establish the status of some self-employed contractors as undertakings’ (11).

(24)

In its guidelines on the application of Union competition law to collective agreements regarding the working conditions of solo self-employed persons (12) the Commission clarifies that in its view collective agreements by solo self-employed persons who are in a situation comparable to that of workers fall outside the scope of Article 101 TFEU; and that the Commission will not intervene against collective agreements of solo self-employed persons who experience an imbalance in bargaining power vis-à-vis their counterparty/ counterparties.

(25)

Regulation (EU) 2021/1057 of the European Parliament and of the Council (13) maintains the obligation of Member States to ensure meaningful participation of social partners in the delivery of policies supported by the European Social Fund Plus (ESF+) and strengthens their obligation to support the capacity building of social partners. Where applicable, an appropriate amount of ESF+ resources should be allocated by Member States for the capacity building of social partners and civil society. Article 9 of that Regulation provides that Member States that have a European Semester country-specific recommendation in this area are to allocate at least 0.25 % of their ESF+ resources under shared management to this aim.

(26)

This Recommendation will support the implementation of Principle 8 of the European Pillar of Social Rights. It encourages measures that are adapted to national traditions, rules and practices, thus respecting national specificities as well as the autonomy of the social partners. This Recommendation complements and is without prejudice to existing instruments at Union level. In addition, this Recommendation takes into account the specific circumstances of Member States and recognises that the choice of individual measures for its implementation can be determined by such circumstances.

(27)

This Recommendation cannot, under any circumstances, be cited to justify reducing the level of support already afforded to social dialogue, including collective bargaining, within Member States. Furthermore, this Recommendation does not preclude Member States from putting in place stronger support measures and more advanced provisions for social dialogue, including collective bargaining, than those included in this Recommendation.

(28)

This Recommendation is without prejudice to the competences of the Member States regarding pay, the right of association, the right to strike and the right to impose lock-outs, in line with the provisions of Article 153 (5) TFEU, or to the autonomy of the social partners.