Witold Gadomski
Trade unions – a costly state within a state
entrepreneurship, labour market, trade unions
(infographics Dariusz Gąszczyk)
Sociologists dealing with Polish trade unions estimate they have between 1.5m2.4m members. This wide divergence underscores the lack of precise data on
trade. What the surveys do clearly show is that 74% of respondents do not see
unions having any positive impact the situation of employees.
According to OECD data, 12.5% of the Polish workforce is unionised. However, in
May 2013 a survey by the CBOS polling company indicated that that only one in 20
Poles belong to a union, or one in 10 employed people. .
According to Polish law, a union can be set up if at least 10 workers want to join. In
2012, the Supreme Court ruled that the employer is not allowed to demand a full
list of trade union members, since it would violate the provisions on personal data
protection. The number of trade union members may be verified by the State
Labour Inspection, which, however, has no database on trade unions.
Not only a company’s employees may join trade unions, but also its pensioners and
workers on temporary contracts. Moreover, employees can belong to more than
one union. This is the case in some coal mines; as a result trade union membership
can exceed 100%.
The majority of trade union organisations belong to three confederations: OPZZ
(All-Poland Alliance of Trade Unions), NSZZ “S” (NSZZ “Solidarity” trade unions)
and the Trade Union Forum (FZZ). However, there are also thousands of trade
unions not associated in any confederation. According to union specialists , several
hundred thousand employees may belong to such organisations.
The number of trade union members is cited by the largest confederations. But it
is impossible to establish how reliable these figures are. Despite their interest in
inflating numbers, data from the confederations shows the number of union
members is falling steadily.
(infographics D.Gąszczyk)
Legenda:
Tytuł: Number of trade union members and organisations
Liczba członków – Number of members
Liczba organizacji – Number of organisations
1992
1995
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Source: Gardawski J., Mrozowicki A., Czarzasty J., 2012, History and contemporary
situation of trade unions in Poland, Dialo, no. 3
According to CBOS, the average trade union member is 45 years old and works in a
state-owned company or a public. The highest percentage of union members can
be found in education, science, health care and administration as well as transport
and communication, with a slightly lower percentage in industry. Trade unions
rarely operate in private companies created from scratch. The strongest trade
unions are found in state-owned companies or partially privatised companies.
Sectors with the lowest trade union membership include trade and retail sales,
financial services, hotels and construction as well as small manufacturing
enterprises.
A CBOS survey conducted in 2014 shows 74% of respondents do not recognise any
positive impact of unions on the situation of employees (38% of respondents asked
about the effectiveness of trade unions responded, “They make an effort but they
are not very successful”, and an additional 36 % said, “No effects of their activity
are visible”).
It is worth remembering that small and medium-sized companies – where unions
are almost non-existent – employ approximately 70% of the Polish workforce and
generate 67% of the country’s GDP. The importance of this sector for the
generation of national income is many times higher than that of mining, metallurgy
or the fuel industry, where unions are stronger.
Downward trend
The number of trade unions is decreasing around the world – the result of broader
trends. The power of trade unions grew alongside industrial development. In the
United States industry overtook agriculture in terms of employment levels in 1915.
The number of jobs in industry grew until the mid-1950s. Afterwards, the share of
industry in the workforce started to decline. In Western Europe this process started
a decade later. According to the Boston Consulting Group, the value of industrial
output in the USA in the years 1973-2013 doubled in real terms, but employment in
the manufacturing industry decreased by one-third, due to a leap in labour
productivity. The same trend can be observed in other countries. Employees are
moving mainly to the service sector, where the level of unionisation is lower than
in large industrial plants. Flexible work patterns are more and more common, as
well as work on-line. That makes it difficult to establish a union and difficult for an
existing union to be very useful.
Various labour models exist worldwide. In the past, union membership was almost
automatic in Scandinavian countries, but the number of union members is
decreasing there too, although it still exceeds 50%. The percentage of unionised
employees in France is surprisingly low. However, trade union membership does
not reflect the intensity of employee conflicts and trade unions’ political influence.
The power and political activity of French unions is greater than that of their
Scandinavian counterparts, which have developed the model of dialogue with their
employers. In Sweden, approximately 650 collective labour agreements apply to
wages and working conditions.
In Sweden. about 90% of employment relationships are regulated under collective
agreements, instead of the generally applicable labour law. Accordingly, the labour
market is more flexible (it is easier to lay off and hire employees), consequently,
unemployment is lower. Polish unions resemble the French ones. The level of
membership is low, most issues related to employment relationships and the
minimum wage are regulated at a statutory level, rather than under collective
labour agreements, but unions are politically powerful. This is a result of both
Poland’s historical legacy and from the concentration of trade unions in large
companies, where a strike quickly become a national event.
(infographics DG)
Legenda:
Tytuł: Percentage of employees belonging to trade unions
2000
2005
2010
2011
2012
2013
Kraje, kolejno od góry): Australia, Austria, Belgium, Canada, Chile, Czech Republic,
Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland,
Israel, Italy, Japan, Korea, Luxembourg, Mexico, Netherlands, New Zealand,
Norway, Poland
Trade union privileges
Polish unionsare regulated by the Act on Trade Unions of 23 May 1991 (as
amended). Besides its mandate to represent employee interests, the Act confers
numerous privileges on unions.
U may conduct economic activity, taking advantage of tax exemptions applicable
to associations. Trade unionists can also use the enterprise they are employed in
for private business. In the former “Ursus” tractor factory, trade unionists
established a company that used the equipment of the parent company to make
spare parts for tractors. These were readily sold, while at the same time there
were few buyers for finished tractors.
In the Jastrzębska Spółka Węglowa coal miner, wives of union activists ran shops
on mine premises. In the Gdańsk Shipyard, the local Solidarity union held a fundraiser by selling so-called ‘bricks’. Many union members act as insurance agents
selling policies in their own plants. In companies in which the State Treasury has a
stake, participation of trade union activists in supervisory boards is the rule.
Under Polish law, an employer cannot fire a member of the management board or
the audit committee without union approval. As well, employers cannot amend the
contract of such employees – a status that also applies to the founding committee
of a new over a period of 6 months after its establishment. That means in big
companies it is common practice to establish new unions when the company
announces redundancies. That allows many workers to take shelter under the label
“trade union activist”.
The provision exempting activists in larger trade unions from the obligation to work
is particularly important for union members. When a union has fewer than
members, one leder is partly exempted from woprk . If the union has from 150 to
500 members, the leader is fully released from work, while keeping existing
wages, including bonuses and privileges. The number of union jobs rises along with
growth in members - one additional full-time position is allocated for each
thousand union members.
This regulation is the main reason for trade union proliferation. If 1500 members
belong to a union , the union gets three full-time positions paid by the employer.
However, if 10 trade unions are created, with 150 members each, they have 10
full-time positions and, additionally, many activists are protected against
redundancy. Because workers can belong to more than one union, 1500 workers
may create not just 10, but even more organisations, all with full-time positions
paid by the employer.
When the Act on Trade Unions was being passed, the issue of limiting the number
of activists’ terms of office of was raised. Union activists managed to block this
provision and, consequently many have kept their posts since the early 1990s.
“Trade union activists are true professionals,” says Maciej Grelowski, who has sat
on the Tripartite Commission representing employers on behalf of the Business
Centre Club. “They are always perfectly prepared for the negotiations. They know
the statistics, the law, the tricks of negotiation. The representatives of the
government are like blind kittens next to them.”
Union activists know their position depends on how much they achieve for their
‘clients’ - the employees. They demand high payment for their services.
Three years ago, the Treasury Ministry analysed the costs of trade union activity in
enterprises at the request of the Polish Confederation of Private Employers Lewiatan. The annual maintenance of trade unions in companies in which the State
Treasury has a stake costs over 50m zlotys. In the Tauron group and KGHM it is over
10m zlotys, in the Energa group - over 5m zlotys
What is interesting is that trade union confederations do not have data concerning
the number of professional activists.
“We are not entitled to collect such information.” says the press secretary of the
All-Poland Alliance of Trade Unions. “Trade unions included in our confederation
are independent and they do not submit financial statements to us.”
Individual unions also do not disclose their financial situation.
“The National Commission of NSZZ Solidarity employs approximately 100 people. I
am unable to answer your question concerning the number of Solidarity activists in
plants and their wages due to the lack of sufficient data or the confidential nature
of such information,” responds the spokesperson of Piotr Duda, the head of
Solidarity.
Required reforms
As a result, the Polish labour market is divided into two groups. The first comprises
those who work in small- and medium-sized private companies or those who are
self-employed, experiencing the advantages and disadvantages of the free market
on a daily basis.
On the other side, there are employees of huge state-owned or partly privatised
companies where the investor has concluded an agreement with trade unions and a
social package was a part of the privatisation agreement. In such companies, trade
unions play an important role in the decision-making process. Compliance with the
Labour Code is the minimum expected by trade union activists. Employees often
have privileges going far beyond the provisions of the Code. For example, in
Jastrzębie Coal Mining Company, sickness benefits amount to 100% of their pay,
and a recent attempt to curtail that privilege helped unleash a strike.
This division is obviously unfair. “Unprotected Poland” works harder, longer and
usually has a lower income. One of the reasons for such a situation is that
“protected Poland” gains a bigger slice of the national cake than it has generated.
This pathology is the result of the flawed Act on Trade Unions, which might have fit
the situation in the first years of the transformation, but is currently jeopardising
the restructuring of distressed large enterprises. It also offers unjustified privileges
to a small group of activists. The following changes are necessary:
1. Raising the minimum number of trade union members required to register a trade
union organisation to 15; however, they should constitute at least 10%of
employees.
2. Ban on multiple union membership.
3. Public disclosure of information concerning trade union finance and the
obligation to have such information audited by independent auditing companies.
4. Limiting the number of unions in a single plant to the two with the highest
number of members.
5. Ban on conducting economic activity by trade unions or running business by trade
union activists on plant premises.
6. Self-financing of trade unions – of both full-time activists and the maintenance of
office premises.
7. Financial sanctions to be imposed on the trade union and its activists for
generating losses as a result of an illegal strike or other forms of protests.
8. Loss of immunity by trade union activists violating the provisions related to
collective bargaining.
Many Polish union activists understand that excessive claims against an employer in
difficulty could actually hurt workers. However, the current state of union law
forces even moderate union leaders to strengthen their rhetoric. This was clearly
visible in the case of the coal mines.