Chapter 6: Flexibility through stability - The institutionalization of company-level bargaining on working time in Danish industry
By Anna Ilsøe and Trine P. Larsen
A main hypothesis regarding the Danish Model is that Danish labour market regulation has shown great adaptability, and that unions and employers´ organizations have handled various challenges through collective bargaining and agreements. This has been documented through institutional studies of sector-level bargaining in manufacturing. However, given the decentralization of negotiations within the Danish collective bargaining system, it remains a key question to what extend the adaptability is a result of the institutionalization of company-level bargaining.
This paper addresses the institutionalization of company-level bargaining within Danish manufacturing. It focuses on company-level bargaining on working time, which has been demonstrated to be a main driver in the development towards more decentralized bargaining systems. Based on data from three quantitative surveys in 1998, 2008 and 2010 among shop stewards in Danish industry it examines the development in local negotiations and management-employee relations in manufacturing companies over time. The main focus in our empirical analysis is whether the management and shop stewards utilize the opportunities to negotiate and conclude agreements on working time when the company faces challenges that require adaptation to the company and its employees. Furthermore, we examine the changes in bargaining activity (number and type of agreements) as well as in bargaining relations (trust in counterpart, support from constituencies).
The papers main argument is that shop stewards and managers to a large extent have exploited the opportunities for local negotiations on working time to handle the challenges that business face over time. For instance, they have negotiated different types of working time agreements during different time periods. The contents of working time arrangements varies over time and reflect, among other things, that the agreement system is used to customize local contractual obligations to the company and its employees. This is particularly evident among workplaces hit by financial cutbacks, wage cuts and dismissals where the activity regarding local agreements on working hours is significantly higher compared to other companies. At the same time, bargaining relations seem to have been relatively unchanged during the period 1998-2010 with high levels of trust between the bargaining parties and high support to the chief negotiators from the constituencies. Furthermore, there seems to have been a development of increasing formalization of agreements. In 2010, we find a significantly lower number of informal agreements on working time (so-called ‘closet agreements’ that local managers and shop stewards hide from the sector-level organizations) than in 1998. In sum, it seems that the local bargaining parties have used the opportunities for local negotiations to develop local bargaining institutions and practices that resemble the sector-level institutions and practices in Danish industry.