Chapter 4 - The European Dimension

General Council Report

Chapter 4

the european dimension

Introduction The General Council are commending to Congress the Statement Britain and Europe - Next Steps which seeks to build on the new opportunities following the election of a Government committed to playing a full part in EU affairs.

The General Council have been guided by the composite motion on the European Union and the Statement the European Union: trade union goals adopted by Congress last year. Their aim was to see the Intergovernmental Conference rebalance EU priorities from a narrow focus on monetary stability towards policies on employment and social provision - including an end to the UK opt-out from the Maastricht Social Chapter; and to foster social dialogue at all levels, including an agreement on equal rights for part- time workers, and the development of information and consultation through European Works Councils.Significant progress has been achieved in a number of areas

4.1 Employment and the Intergovernmental Conference

The ETUC General Secretary, Mr Emilio Gabaglio, addressed the General Council meeting in April. He said that the ETUC day of activities on 28 May was a key initiative to press for employment to be pushed up the agenda at the Intergovernmental Conference so as to complement the Maastricht Treaty with a stronger social and employment dimension. The ETUC had managed to impose that agenda for the IGC -which originally had been intended mainly to deal with the institutional consequences of enlargement and Foreign and Security Policy issues.

The ETUC supported moves to EMU but believed that a dogmatic interpretation of the convergence criteria would add to problems in a number of countries. ETUC affiliates generally supported that position, and in particular the DGB which had held a special meeting on the matter in April. The decision as to which countries fulfilled the conditions would be taken by Qualified Majority Voting in the European Council, and would be a political rather than a technical decision. The expectation was that the timetable would be adhered-to. In a number of countries governments had set up task forces, including trade union representatives, to advise on the introduction of the single currency. The single currency would certainly have an influence on collective bargaining strategies, and the European Industry Federations would have an increasingly important role to play, together with the ETUC. An objective was to avoid beggar-my-neighbour policies. So far as the public sector was concerned, the ETUC was pressing for the inclusion in the Treaty of a recognition of its role to ensure social cohesion.

Following the decision of Renault to close its Vilvoorde plant in Belgium, the ETUC was pressing for a revision of European instruments on information and consultation of workers to reinforce provisions for prior consultation, and for stronger sanctions against

breaches. The setting up of a proper forum to discuss industrial restructuring more generally was being discussed in the Social Dialogue procedures.

The ETUC had pressed for the inclusion in the Treaty of non-discrimination clauses and, as part of its campaign, had held a major Conference at the end of March at which the TUC had been represented. The ETUC also supported the establishment of a European Observatory on racism.

ETUC Day of Action

Over 300 people attended a major conference organised at Congress House on 28 May as part of the ETUC Day of Activities. The Conference was chaired by Mr John Edmonds and addressed among others by the Foreign and Commonwealth Secretary Robin Cook, and the Dutch Minister for Social Affairs and Employment Ad Melkert on behalf of the EU Presidency. Mr Melkert referred to the importance of social stability and a high level of employment as essential to the European model. Mr Cook, in the course of a wide-ranging speech, described support for the Employment Chapter as reflecting the importance of balancing monetary targets with broad economic objectives, such as high levels of employment.

A number of regional events were also organised and, in preparations for the Day of Activities, the TUC worked closely with the TUC Unemployed Workers' Centres whose representative, Mr Kevin Coyne, addressed the London Conference.

The Executive Committee approved a special report for the Conference, Europe Must Work, which was widely distributed.

Amsterdam European Council

The European Council on 16-17 June concluded the Intergovernmental Conference by adopting the Treaty of Amsterdam which, after being signed in October, will be open for ratification by the Member States. The European Council also adopted Resolutions on Stability, Growth and Employment, and endorsed on-going action on the European Pact of Confidence for Employment launched by President Santer early in 1996.

The Executive Committee noted that the European Council had welcomed the integration of the Maastricht Social Chapter into the main body of the Treaty; the UK's accession to the social provisions of the new Treaty; and its willingness to accept directives already adopted, or to be adopted, under social chapter provisions. The UK had made it clear that they intended to use the time it would take for the Treaty to be ratified to run them in. The likely arrangement so far as the European Works Councils Directive was concerned would be that companies newly-covered because of the UK inclusion would have a two-year period to reach agreements.

The new Employment Chapter provided for employment guidelines to be set and for incentive measures involving some expenditure. It called for the promotion of a skilled, trained and adaptable workforce and labour markets responsive to economic change with a view to achieving a high level of employment. The inclusion of this objective in the Treaty was a step forward, and the proposed special summit meeting on employment which it had been agreed should be held in the Autumn provided an opening which the ETUC had said it would wish to exploit, while expressing disappointment about the outcome of the IGC for not achieving its more integrationist objectives.

The view was expressed that the question of free movement of persons, particularly in respect of black and ethnic minority groups, needed to be given careful consideration in the context of any discussion on possible UK opting in to the Schengen Agreement, which was now part of the Treaty. The Treaty also included a new competence for the EU to take action to combat all discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation. It contained stronger references to the promotion of equality between women and men; new provisions for initiatives to combat social exclusion; a declaration that the needs of persons with a disability should be taken into account; and reference to the Community Charter of Fundamental Rights of Workers.

Resolutions on the Stability Pact, and about Growth and Employment adopted by the Amsterdam meeting were not directly related to the IGC, but had helped secure French agreement for the Treaty and the confirmation of the EMU timetable starting on 1 January 1999 . The European Council had also agreed the design of the coins which should start circulating in 2002.

The Executive Committee noted that the Conclusions, to which all heads of government were signed up, made several references to social dialogue and social partnership as important parts of the European model. The European Council in particular had welcomed the social partners' agreement on part-time work.

4.2 Economic and Monetary Union

At their July meeting the General Council received a report updating them on recent developments, including the rapidly strengthening value of the pound. The text of the statement is incorporated in the special statement Britain in Europe - Next Steps, which is being presented to Congress by the General Council as part of their report to Congress.

4.3 Structural funds

In May the TUC published the guide , Trade unions and the European Structural Funds, prepared by Dr Jane Pillinger of Northern College. The proposal for the guide came from the TUC BSE Group which was examining how structural funds could be used to help workers who had lost their jobs, or were laid off, as a result of the beef crisis. The pamphlet was presented to delegates attending the Conference on Social Europe, held

on 28 May at Congress House. At that Conference, Arlene McCarthy MEP, European Parliamentary Labour Party spokesperson on Regional Policy, explained the latest thinking on structural policy, making a special reference to the Territorial Employment Pacts (TEPs).

The TEPs were proposed by President Santer at the Florence Summit in 1996 and, following the general election, the Labour Government reversed UK policy and decided to take part. Ten pilot projects in the UK will be selected from the 20 proposals that have been drawn up at a sub-regional level. The social partners will be involved in managing these innovative projects along with other agencies and local authorities. They will be monitored by the structural fund Programme Monitoring Committees in the regions, committees onto which the Government has now invited social partner representation. The pilot TEPs will receive funding of 200,000 ECU, additional to the structural funds made available to them. The initiative represents a further attempt, in the context of the Confidence Pact for Employment, to make the structural funds more employment creating. The TUC will be holding a series of regional seminars dealing with these issues, among others.

4.4 Social Policy

There have been substantial social policy developments during the past year in which the TUC has had a major interest. These include further progress under the Medium Term Social Action Programme, the European Court of Justice decision on the Working Time Directive, the adoption by the Commission of the European Parliament's report on the Acquired Rights Directive, the adoption of the Reversal of the Burden of Proof Directive and the negotiation of the Part-time Agreement under the Social Protocol, among other things. These are reported below.

Working Time Directive

On 12 November 1996 the European Court of Justice (ECJ) published its decision on the case brought by the Conservative Government against the Council and Commission over the legal base of the directive. The Court rejected the basic argument of the UK government and awarded costs against them. In making its judgement, the ECJ provided for the first time a legal definition of Article 118a of the Treaty, the article dealing with health and safety at work. It interpreted the article as having a broad scope, based on the original definition of the Working Environment originally put forward by Denmark at the IGC in 1985, and accepted by the other Member States. This included working hours and other work organisation questions. The ECJ went further still in its judgement, referring to the World Health Organisation definition of health as positive physical, mental and social well-being and not merely an absence of infirmity or disease. The EC's legal definition will continue to have many ramifications for future health and safety and working conditions measures. In February the TUC responded to a consultation on the Directive undertaken by the Government following the ECJ decision, and called for the excluded sectors (transport and doctors in training) to be covered by working time provisions. The Commission issued a White Paper on the subject in July.

Acquired Rights Directive

The European Parliament adopted the Kerr Report on the revision of the Transfer of Undertakings Directive in January 1997 by an overwhelming majority. The European Commission accepted the report and modified its approach to the proposal. It dropped the idea of revising and replacing the directive completely in favour of a proposal for amendment. The new draft took on board most of the suggestions made by the Parliament, and supported by the TUC and ETUC, including the maintenance of the original wording of the crucial Article 1.1, the definition of a transfer. The new draft is presently being discussed by the Social Questions Working Group of the Council.

Reversal of the Burden of Proof

The Social Affairs Council held under the Dutch Presidency on 27 June 1997 adopted the common position on the Reversal of the Burden of Proof in cases involving sex discrimination. The UK delegation participated in the debate even though it was a Social Protocol proposal - an arrangement had been made for them to do so at the Amsterdam Council in advance of ratification of the new Treaty (complete with the new Social Chapter) by the Member States. The social partners had previously examined the possibility of reaching a framework agreement but decided the legal complexities meant that the directive route was preferable. The directive , on the basis of the case law of the European Court of Justice gives a clear definition of indirect discrimination, something covered neither by the Treaty or previous legislation.

Part-time Work Agreement

The content and achievements of the Part-time Agreement, which are considerable for part-time workers in the UK, are reported in Chapter 3 Campaigning for equal rights. The agreement is a major step forward, too, in the construction of a European system of industrial relations. This emerging system is based on directives and other measures adopted under the old Treaty, the negotiated legislation of the Maastricht Social Protocol (new Amsterdam Social chapter) and the case law of the European Court of Justice, all based on the 15 national systems of industrial relations. An additional element of the emerging system - the ability of the social partners under the Social Protocol to negotiate voluntary agreements at European level - has not yet been used.

Medium Term Social Action Programme

The Commission issued its progress report on the Medium Term Social Action Programme 1995-97 in January 1997. It provided a detailed assessment of the state of play of the Social Action Programme items up until the end of 1996 and the record of Member State implemention of proposals that had been adopted by the Council. Looking forward, the Commission emphasised the theme of 'Social policy as a productive factor', or the contribution that social policies make to economic performance. This was the subject of the first of a series of six conferences on social policy, organised by the Dutch Presidency, in which the TUC participated. Employment

and equal opportunities were the two priorities. In the case of the former, the Essen process has continued with more action being taken by the EU at the institutional and other levels to reinforce the fight against unemployment.

A wide range of equal opportunity measures have either been adopted recently or are in the process of adoption. Apart from the Reversal of the Burden of Proof, central to all public programmes has become the underlying principle of work on equal opportunities, the proposal for the Prevention of Sexual Harassment at the Workplace is in the Social Protocol and the principle of sex equality in social security matters is being examined. Action has been stepped up against racism, with the proclamation of 1997 as the European Year Against Racism. Several expert reports have been commissioned, related to subjects as diverse as freedom of movement, and participation of workers in European Companies (the proposal for a European Company Statute). The Commission has pursued actively a number of the items included in the Social Action Programme following the negotiations between the Parliament and the Commission and it has also continued with to promote equal opportunities for people with disabilities. The TUC goals of strengthening the Social Action Programme and seeing social policy based on a single legal framework (integration of the Social Protocol in the Treaty) have met with a large measure of success. In the future a majority of social policy proposals will come to the social partners in the first instance for a decision over whether a negotiated framework agreement is to be the preferred route for legislation. This will further enhance the process of building a European industrial relations system.

Social Dialogue

The Social Dialogue Committee and its sub-committees have concentrated on action over employment during the year and on the lengthy negotiations over part-time work. On employment the Committee has taken part in the further development of the Confidence Pact for Employment and the establishment of the new process for dealing with employment and economic policy, set up both before and after the Amsterdam Council. A high level Social Dialogue meeting was held in The Hague in June to sign the Part-time Agreement and to discuss the social aspects of industrial restructuring, exemplified by the Renault case. Discussions are continuing between the social partners and the Commission and Council over what action needs to be taken to strengthen the information and consultation rights of workers in such situations. The ETUC is pressing for the amendment of the three related directives - European Works Councils, Collective Redundancies and Transfers of Undertakings - to achieve this. Within the social dialogue process the possibility of voluntary agreements of a Code of Conduct is also being examined.

The Commission also issued its first round Communication on the Social Dialogue. This was followed by a special conference in The Hague to discuss how the process might be strengthened at the sectoral level and in other ways and made more inclusive. The ETUC agreed a joint response together with the employers' organisations, UNICE and CEEP, but made a number of additional points. These included the recognition of the role of the social partners at the sectoral, and consultative Committee levels and

the importance of social partner action at the local and territorial levels. Continuing support was needed, too, for the developing social dialogue process in the Central and East European countries to facilitate enlargement. The Social Dialogue Committee also led the discussion on two important Commission Green Papers published in the course of the year on the Information Society and on a Partnership for a new organisation of work.

4.5 European Works Councils

The coming into force of the Directive on 22 September 1996 marked a new phase for the development of European Works Councils. After this date, no further "Article 13" agreements would be possible, and the Special Negotiating Bodies (SNBs) stipulated by the Directive would come into force.

Although not all transposition legislation was in place by the 22 September deadline, by the time of writing, most Member States had legislation in place, enabling the establishment of SNBs to take place.

This has meant the first agreements have been concluded by means of mechanisms set up under the terms of the directive, including several with UK-based companies (such as Dalgety and Caradon). Other SNBs are now in progress. Where this has been the case, negotiations have taken place under the legislation of another member state, with Ireland still proving popular as a base for companies' "representative agent".

From early experience, it is now clear that UK participation in SNBs, as in the Article 13 agreements which went before them, is highly likely. The commitment of the incoming government to signing the Social Chapter has meant that even in companies previously reluctant to establish EWCs with British participation, such participation is now accepted as inevitable.

The table below shows the extent of EWCs and SNBs amongst UK-based companies, and the commencement of negotiations with SNBs. It also shows the extent of additional work which will be necessary as a result of the reversal of the opt-out. BOX UK companies and EWCs Covered by Covered if Total Directive now no opt-out

Article 13 Agree- 47 6 53 ment Company initiated 7 0 7 arrangements SNB requested 8 0 8 SNB Agreement 3 0 3

Outstanding 49 119 168

Total 114 125 239

END BOX During the early part of the year, the Multinationals Information Project (which is supported with funds from the European Commission) continued to assist affiliates in their work with particular companies. In the case of Tomkins, this resulted in an Article 13 agreement being signed just ahead of the deadline. Co-ordination of unions in BTR (in association with the European Industry Federations EMCEF and EMF) has now resulted in the establishment of an SNB, to which the UK will be invited to send representatives. A meeting of Rentokil representatives led to an approach to management by EURO-FIET. Co-ordination of the British unions in Compagnie Générale des Eaux for the purposes of selecting representatives to, and reporting back from, the EWC has also been established.

A completely revised edition of the successful booklet on EWCs was published in association with the Labour Research Department (LRD), and a tutors' manual for the training of EWC representatives was launched. Both have proved popular, with the manual being ordered by overseas trade unions and Industry Federations, as well as by TUC affiliates. In May, a seminar was held for negotiators involved in SNBs, at which strategies for successful British intervention in SNBs were discussed.

Development work has continued on the database, in association with the European Trade Union Institute, LRD and affiliates. An improved version is shortly to be made available on the TUC's Web site, enabling enquirers to establish whether their employer is part of a group covered by the EWC directive, and whether an agreement is in existence.

4.6 Information and consultation

Fresh initiatives on worker information, consultation and participation have begun, relating to the establishment of a European Company Statute.

An expert group was established, under Chair Etienne Davignon, to examine the issue of employee participation in any European Company. This recommended in May that European Companies should include some mechanism for employee participation, which should be established through negotiations with representatives of the workforce. In the event that no agreement was reached, the report recommended that at least 20 per cent of the company's board should be employee representatives.

The General Council considered the report an important compromise solution for reconciling different European traditions, and this view was communicated to the Government. The UK Government is to support further active discussions of the Statute by the Council of Ministers, and will consult widely on any draft which may be

proposed.

A consultation paper has been issued to the Social Partners regarding information and consultation of employees at a national level in companies with over 50 workers, in line with the Medium Term Social Action Programme. This paper represented the first stage of consultation under the Social Protocol, and could lead to negotiations between Social Partners. The ETUC is supportive of this approach, as is the TUC.

Both developments will be considered by the European Monitoring Group and the Representation at Work Task Group, and a conference is planned for the latter part of 1997. 4.7 Network Europe

The TUC continues to maintain a high profile in relation to a wide range of organisations and bodies relating to European issues.

The Europe Monitoring Group, chaired by Mr John Edmonds and including Ms Rita Donaghy, Mr Tony Dubbins, Ms Bernadette Hillon, Mr Bill Morris and the General Secretary, have continued to scrutinise important European developments to facilitate the work of the Executive Committee.

The TUC holds monthly meetings of the Network Europe Contact Points, composed of representatives of affiliated unions, at which up-to-date information on European developments is discussed.

The TUC Brussels Office maintains close contacts with the ETUC and its Industry Federations, the European Parliament (particularly its Employment and Social Affairs Committee), the Commission and other European institutions. The office takes part in the network of national trade union centre representatives and during the year has received and assisted a variety of trade union groups and other visitors. It helped to organise a number of conferences, seminars and other meetings, including an ETUC conference on the Social Economy which was held in Congress House in June. The Multinationals Information Project (MIP) has continued its close relationship with affiliates. In particular, meetings of British representatives on European Industry Federations were continued, to ensure that work on European Works Councils, information and consultation, and of the MIP generally does not overlap with the Federations' activities, and was complementary to it.

The TUC European Information Service, as one of the sectoral information relays established in conjunction with the London Office of the European Commission, provides affiliates with access to a wide range of European publications and databases.

The TUC also publishes EuroBriefing, an occasional round-up of EU issues for wide dissemination.

Professional and managerial staff representation

The TUC convenes meetings of interested unions covering Professional and Managerial Staffs (P&MS) which, through their membership of the TUC, are members of the ETUC P&MS Council - Eurocadres. This allows access, in particular, to the annual Eurocadres General Assembly and Symposium. That was held in Brussels in December and was addressed by the TUC General Secretary. Discussions in the TUC group centre on issues relating to the free movement of P&MS in Europe, and their representation in the social dialogue.

A UK P&MS Symposium was held in Congress House in February in which some 70 trade union representatives participated. The TUC commissioned the Labour Research Department to prepare a special background report for the meeting, dealing with trends and prospects for professional and managerial staffs.

European Trade Union Confederation

TUC representatives have continued to play a leading part in the work of the ETUC. The ETUC has in affiliation 56 national trade union centres in 28 countries with a total membership of about 53 million. Also affiliated are 13 European Industry Federations covering all the main fields of activity. In November the ETUC Executive Committee approved procedures for the closer involvement of the Industry Federations in social dialogue negotiations.

ETUC institutes

TUC representatives have continued to participate in the work of the European Trade Union Institute, the European Technical Bureau for Health and Safety, and the European Trade Union College, which are linked to the ETUC.

Economic and Social Committee

The ESC mourned the death of a member of the TUC delegation, Mr Dick Pickering, in October. During the year TUC representatives, including Mr Tom Jenkins who was elected President of the Committee for a two year term from October, have played an active part in the work of the ESC, which scrutinises all important EU draft legislation as well as acting on its own initiative particularly in fostering contacts with economic and social organisations around the world. The Amsterdam Treaty will give the ESC enhanced competences in the employment and social field, and for the first time will enable the European Parliament to consult the Committee formally, in addition to the Council and the Commission.

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