Unions: no revival anytime soon

In a speech to the Irish employers’ group IBEC, our own Tom Hayes said that the EU’s Adequate Minimum Wage Directive (AMWD) is unlikely to boost union membership across Europe.

Why it matters: As union membership declines, the directive’s focus on collective bargaining, rather than membership growth, poses challenges for unions. This could impact how labor rights are negotiated and both employers and employees may face new dynamics in labor discussions.

The big picture: Despite high collective bargaining coverage in countries like France and Germany, actual union membership remains low.

• In France, 98% coverage contrasts with just 8% union membership.
• The public sector holds most of the union membership.

What’s next: Employers must prepare for extensive new EU Directives, such as Pay Transparency and Platform Workers. Training for both management and employee representatives is essential. New information and consultation structures need to be set up effectively.

ADDITIONAL INFORMATION:

Our European Academy training program in Sitges, Barcelona next April will focus on how management in undertakings - impacted by the issues discussed above - can put a plan in place to deal with them. The full program details will be circulated in early January. To register your interest now, email [email protected]

Extracts from Tom Hayes prepared remarks at the IBEC HR Conference on October 23, in Dublin, Ireland.

I do not think the EU’s Adequate Minimum Wage Directive (AMWD) would shift the dial on declining union membership in Ireland or elsewhere in Europe, despite what unions might believe. 

Article 4 of the AMWD is no magic bullet. Article 4 requires Member State governments to take measures to promote collective bargaining when collective bargaining coverage falls below 80% of the workforce. Hayes pointed out that the requirement in Article 4 is the promotion of collective bargaining coverage, not union membership. 

In countries such as France, Germany, and Spain that was a very big gap between bargaining coverage and union membership, most noticeable in France where coverage was 98% while union membership was about 8%, and most of that was in the public sector, with private sector membership somewhere between 4 and 5%. Density in Germany was down to 16%, again concentrated in more mature industries and the public and quasi-public sector.  Boosting collective bargaining coverage would not necessarily result in increased union membership. Why pay a union subscription if you are going to get the benefits anyway?

For the past twenty years, union membership was in decline across Europe and there was no evidence that this was going to change anytime in the future. Workers were simply not interested in joining unions. There was a multiplicity of reasons why this was the case, but one thing could be discounted. Union avoidance, was not a feature of the landscape in Europe. 

Of course, there was the odd incident, but such incidents were few and far between. Unions had not figured out how to make an attractive offer to day’s workforce. Consistent, negative, hostile comments about transnational undertakings did not help either. Why would any management want to do business with an organisation which says: “We want access to your premises so we can recruit your workers, push up your labour costs, make your decision-making more difficult and bad-mouth you at the same time?”

I think the bigger challenge for management in the years ahead, again not just in Ireland but across Europe, would be dealing with the extensive information and consultation obligations imposed by the suite of new EU Directives, including Pay Transparency, the two Due Diligence Directives (CSRD, CSDDD), and Platform Workers. Others were also coming such as The Right to Disconnect and, very probably, AI in the Workplace. Not to mention the rewriting of the European Works Council Directive. 

Dealing with these extensive new entitlements for workers would not just be a challenge for management. It would also be a challenger for unions. How will unions deal with information and consultation forums, based on the law, and with access to courts and tribunals in the event of disputes? What role will they see for themselves in engaging with non-union employees’ representatives. Will they see such forums as allies or adversaries?  

Management needed to start putting plans in place now to allow them to meet these challenges. He suggested that Directive 2002/14, establishing a general framework for informing and consulting employees, as transposed into national law, might be worth looking at as it provided a workable basis for what needed to be done.

A key issue that will need to be addressed is how to provide new information and consultation representatives with appropriate training to allow them to engage meaningfully with management because when you look at the new Directives there will be significant and substantive issues on the table. The same will also be true for management, especially in undertakings that have no tradition of dealing with employees’ representatives. They will need training on how to negotiate the establishment of information and consultations structures, and then how to work with them constructively. 

In conclusion, while I do not see a surge in union membership coming anytime soon, the employee relations challenges that the new Directives would bring should not be underestimated. 

**N.B. Correction: the extracts text was edited on Oct 25th to omit a line that was not delivered at the event.