Social Europe

politics, economy and employment & labour

  • Themes
    • Strategic autonomy
    • War in Ukraine
    • European digital sphere
    • Recovery and resilience
  • Publications
    • Books
    • Dossiers
    • Occasional Papers
    • Research Essays
    • Brexit Paper Series
  • Podcast
  • Videos
  • Newsletter

Social dialogue: an opportunity in the midst of crisis

Veronica Nilsson 20th October 2020

Some claim social dialogue is a luxury in a crisis when quick decisions are needed. On the contrary, the pandemic has proved.

social dialogue
Veronica Nilsson

Despite the difficulties many of us have experienced this year, the crisis has also brought opportunities, including a re-examination of the way we work. 

The 2020 Global Deal flagship report, ‘Social Dialogue, Skills and Covid-19’, just published, documents extensively how social dialogue has proved a key tool in addressing the damage wrought on labour markets by the pandemic—and shows how we can better prepare for changes in the post-pandemic world of work.

Central role

Social dialogue played a central role in shaping those agreements which prevented the sudden lockdown of major parts of our economies from translating into an even bigger crisis. In several countries, deals were struck whereby business refrained from firing workers, trade unions accepted reduced working hours and lower monthly wages, and governments stepped in financially to make up part of the difference in the initial wage. Social dialogue on short-time working schemes acted as a crisis circuit-breaker, by preventing massive job destruction and thus avoiding further knock-on effects on aggregate demand—which would otherwise undoubtedly have deepened the crisis.

Social dialogue has also been frequently used in the negotiation of numerous guidelines and protocols, on measures to be taken to keep the virus from spreading through workplaces. One among many examples in the flagship report is from Italy, where an 18-hour negotiation round between social partners in early March was able to avoid a proliferation of strikes linked to workers’ concerns about the risk of getting infected at work. From car factories in the United States, to retail stores in Austria, to global companies such as Telefonica, many similar agreements have been struck—all with the key objective of agreeing measures to contain the pandemic in the workplace. 


Our job is keeping you informed!


Subscribe to our free newsletter and stay up to date with the latest Social Europe content. We will never send you spam and you can unsubscribe anytime.

Sign up here

Social dialogue has moreover allowed businesses to achieve flexibility in working time. An interesting practice in France is ‘bargaining under the shadow of labour law’. A labour-law reform provided more leeway for management to decide staff holidays but only if a collective agreement allowed it to do so. As a result, a range of company and sector agreements were made, whereby flexibility in working time in the post-lockdown phase was reconciled with more job and financial security for workers during the lockdown.  

Social dialogue has further been utilised to improve global supply chains. With international buyers abruptly cancelling orders, the vulnerability of those supply chains primarily based on squeezing wages, with razor-thin margins and no buffers to withstand shocks, was clearly revealed. To build more resilient supply chains, business, trade unions, governments and international organisations joined forces at the end of April, issuing a ‘call for action in the global garment industry’. The key idea was to mobilise funds to finance systems of social protection while also ensuring business continuity, with brands and retailers committing to pay producers for finished goods and goods in production and considering direct supports to factories in their supply chains.

Trust, fairness, voice

So why, in these tough times, are numerous economies embracing such intense social dialogue? As the Global Deal report describes, social dialogue presents advantages which are of particular interest when it comes to managing crises. The key words are trust, fairness and workers’ voice.

Trust between labour-market stakeholders makes a big difference. Lack of trust obstructs the whole process of dialogue, as doubts may arise as to whether others will effectively honour any bargain struck. Social dialogue helps build that trust. By regularly meeting up to discuss and manage problems which arise in the company or the economy at large, the different stakeholders (employers and their organisations, trade unions, governments) improve their mutual understanding of the problems each side is facing. Hence, when a crisis strikes, the existence of sufficient social trust ensures a consensus can be secured more readily. 

Policy responses to a crisis are also more easily reached when efforts are broad and fairly shared. Social dialogue works as a co-ordination instrument committing all actors involved to pursue similar action and behaviour. In the case of short-time work for example, cutting working hours and giving up (part of) monthly revenue is more likely to be accepted if workers know that there are no ‘freeriders’ and that efforts necessary to save jobs and businesses will be shared by all.  

Social dialogue moreover overcomes the difficulties individual workers may have in raising their concerns, by providing a collective voice, at the level of the company and that of the wider economy. This has turned out to be crucial during the pandemic. 

At the macroeconomic scale, social dialogue has enabled a timely reaction to the pandemic, moving beyond existing health-and-safety regulations through the conclusion of special codes and protocols. Within the company, it has provided a channel of communication through which workers and management can discuss the implementation and effective enforcement of these general safety measures.

In this way, social dialogue gives workers the confidence that they and their families will not be exposed to unnecessary risk. In turn, business and society also gain, as the reopening of the economy is greatly facilitated by a smoother return to workplaces. This encapsulates the ‘win-win-win’ situation social dialogue engenders.


We need your support


Social Europe is an independent publisher and we believe in freely available content. For this model to be sustainable, however, we depend on the solidarity of our readers. Become a Social Europe member for less than 5 Euro per month and help us produce more articles, podcasts and videos. Thank you very much for your support!

Become a Social Europe Member

Important responses

Social dialogue is sometimes misrepresented as theoretically desirable but practically difficult, since purportedly crises demand quick responses. The experience of recent months however shows the opposite. Social dialogue has come to the fore on many occasions, delivering important policy responses to the different labour-market challenges triggered by the pandemic. 

As a multitude of evidence in the Global Deal flagship report testifies, this is not a coincidence but the result of structural characteristics of the process and institutions of social dialogue. Strengthening social dialogue should therefore be a key part of the blueprint to rebuild labour markets. 

Veronica Nilsson

Veronica Nilsson is head of the Global Deal support unit in the OECD Directorate for Employment, Labour and Social Affairs.

You are here: Home / Politics / Social dialogue: an opportunity in the midst of crisis

Most Popular Posts

European civil war,iron curtain,NATO,Ukraine,Gorbachev The new European civil warGuido Montani
Visentini,ITUC,Qatar,Fight Impunity,50,000 Visentini, ‘Fight Impunity’, the ITUC and QatarFrank Hoffer
Russian soldiers' mothers,war,Ukraine The Ukraine war and Russian soldiers’ mothersJennifer Mathers and Natasha Danilova
IGU,documents,International Gas Union,lobby,lobbying,sustainable finance taxonomy,green gas,EU,COP ‘Gaslighting’ Europe on fossil fuelsFaye Holder
Schengen,Fortress Europe,Romania,Bulgaria Romania and Bulgaria stuck in EU’s second tierMagdalena Ulceluse

Most Recent Posts

EU social agenda,social investment,social protection EU social agenda beyond 2024—no time to wasteFrank Vandenbroucke
pension reform,Germany,Lindner Pension reform in Germany—a market solution?Fabian Mushövel and Nicholas Barr
European civil war,iron curtain,NATO,Ukraine,Gorbachev The new European civil warGuido Montani
artists,cultural workers Europe’s stars must shine for artists and creativesIsabelle Van de Gejuchte
transition,deindustrialisation,degradation,environment Europe’s industry and the ecological transitionCharlotte Bez and Lorenzo Feltrin

Other Social Europe Publications

front cover scaled Towards a social-democratic century?
Cover e1655225066994 National recovery and resilience plans
Untitled design The transatlantic relationship
Women Corona e1631700896969 500 Women and the coronavirus crisis
sere12 1 RE No. 12: Why No Economic Democracy in Sweden?

Hans Böckler Stiftung Advertisement

The macroeconomic effects of re-applying the EU fiscal rules

Against the background of the European Commission's reform plans for the Stability and Growth Pact (SGP), this policy brief uses the macroeconometric multi-country model NiGEM to simulate the macroeconomic implications of the most relevant reform options from 2024 onwards. Next to a return to the existing and unreformed rules, the most prominent options include an expenditure rule linked to a debt anchor.

Our results for the euro area and its four biggest economies—France, Italy, Germany and Spain—indicate that returning to the rules of the SGP would lead to severe cuts in public spending, particularly if the SGP rules were interpreted as in the past. A more flexible interpretation would only somewhat ease the fiscal-adjustment burden. An expenditure rule along the lines of the European Fiscal Board would, however, not necessarily alleviate that burden in and of itself.

Our simulations show great care must be taken to specify the expenditure rule, such that fiscal consolidation is achieved in a growth-friendly way. Raising the debt ceiling to 90 per cent of gross domestic product and applying less demanding fiscal adjustments, as proposed by the IMK, would go a long way.


DOWNLOAD HERE

ILO advertisement

Global Wage Report 2022-23: The impact of inflation and COVID-19 on wages and purchasing power

The International Labour Organization's Global Wage Report is a key reference on wages and wage inequality for the academic community and policy-makers around the world.

This eighth edition of the report, The Impact of inflation and COVID-19 on wages and purchasing power, examines the evolution of real wages, giving a unique picture of wage trends globally and by region. The report includes evidence on how wages have evolved through the COVID-19 crisis as well as how the current inflationary context is biting into real wage growth in most regions of the world. The report shows that for the first time in the 21st century real wage growth has fallen to negative values while, at the same time, the gap between real productivity growth and real wage growth continues to widen.

The report analysis the evolution of the real total wage bill from 2019 to 2022 to show how its different components—employment, nominal wages and inflation—have changed during the COVID-19 crisis and, more recently, during the cost-of-living crisis. The decomposition of the total wage bill, and its evolution, is shown for all wage employees and distinguishes between women and men. The report also looks at changes in wage inequality and the gender pay gap to reveal how COVID-19 may have contributed to increasing income inequality in different regions of the world. Together, the empirical evidence in the report becomes the backbone of a policy discussion that could play a key role in a human-centred recovery from the different ongoing crises.


DOWNLOAD HERE

ETUI advertisement

Social policy in the European Union: state of play 2022

Since 2000, the annual Bilan social volume has been analysing the state of play of social policy in the European Union during the preceding year, the better to forecast developments in the new one. Co-produced by the European Social Observatory (OSE) and the European Trade Union Institute (ETUI), the new edition is no exception. In the context of multiple crises, the authors find that social policies gained in ambition in 2022. At the same time, the new EU economic framework, expected for 2023, should be made compatible with achieving the EU’s social and ‘green’ objectives. Finally, they raise the question whether the EU Social Imbalances Procedure and Open Strategic Autonomy paradigm could provide windows of opportunity to sustain the EU’s social ambition in the long run.


DOWNLOAD HERE

Eurofound advertisement

Eurofound webinar: Making telework work for everyone

Since 2020 more European workers and managers have enjoyed greater flexibility and autonomy in work and are reporting their preference for hybrid working. Also driven by technological developments and structural changes in employment, organisations are now integrating telework more permanently into their workplace.

To reflect on these shifts, on 6 December Eurofound researchers Oscar Vargas and John Hurley explored the challenges and opportunities of the surge in telework, as well as the overall growth of telework and teleworkable jobs in the EU and what this means for workers, managers, companies and policymakers.


WATCH THE WEBINAR HERE

Foundation for European Progressive Studies Advertisement

Discover the new FEPS Progressive Yearbook and what 2023 has in store for us!

The Progressive Yearbook focuses on transversal European issues that have left a mark on 2022, delivering insightful future-oriented analysis for the new year. It counts on renowned authors' contributions, including academics, politicians and analysts. This fourth edition is published in a time of war and, therefore, it mostly looks at the conflict itself, the actors involved and the implications for Europe.


DOWNLOAD HERE

About Social Europe

Our Mission

Article Submission

Membership

Advertisements

Legal Disclosure

Privacy Policy

Copyright

Social Europe ISSN 2628-7641

Social Europe Archives

Search Social Europe

Themes Archive

Politics Archive

Economy Archive

Society Archive

Ecology Archive

Follow us

RSS Feed

Follow us on Facebook

Follow us on Twitter

Follow us on LinkedIn

Follow us on YouTube