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Thursday, February 11, 2010

The Euro Crisis and the Greek bailout- all you wanted to know about the Greek public sector and unions.

1. The rate of worker participation in trade union organizations has been calculated at about 28%. More specifically, the level of trade union membership is substantially different between the private and public sectors.


2. In the private sector, union the density is not higher than 18% and stands at around 472,304 workers, as of 2007 data. The number of union members among public sector employees is calculated at 311,000 persons and represents about 60% of employment in the public sector. The latter number does not include unionized employees of the security forces who are not represented by the public sector trade union, nor does it include non-unionized military personnel. In certain areas of the public sector such as banks and enterprises under state control union density verges on 90%.

3. The Greek trade unions are represented at the highest level by two confederations the Greek General Confederation of Labor, founded in 1918, which includes all trade unions covering employees under private law labor relations in the private and broader public sector – that is, 70 union federations and 83 labor centers with a total of 472,304 voting members and the Confederation of Public Servants, established in 1947, which includes the trade unions of public administration, where public law labor relations apply. ADEDY is a three-level organization, encompassing 1,260 first-level trade unions organized in 46 federations and representing a total of 311,000 voting members.

4. The organizational structure of the trade union movement has the form of a pyramid, with three levels of representation: primary or first level (company, regional or craft unions), secondary (local labor centers, sector federations) and tertiary (national confederations such as GSEE and ADEDY).

5. Membership in employer organizations entails an obligation to take part in collective agreements with the unions.

6. In accordance with the Greek labor representation system within enterprises, three main forms of representation exist at workplace level: trade unions, works councils and safety and health committees.

7. The current system of collective bargaining has been in force without any changes or amendments since 1990. The EGSSE sets minimum wages and salaries for workers all over the country and is signed by GSEE on the trade union side and SEV, GSEBEE and ESEE on the employer side.

8. Sectoral collective agreements cover employees of many companies of similar or related industries or sectors, and are signed by sectoral federations of employers and employees.

9. Company or plant-level trade unions and company management sign company collective agreements, which cover the employees of a single company.

10. The minimum wage at the end of 2007 was €685; the respective daily wage was €29.39. At the end of 2008, the minimum wages were €710 and €31.32 respectively.

11. National occupational and local or regional occupational collective agreements, which cover employees engaged in a specific occupation or profession at national or local level, are signed by employer federations and occupational trade unions.

12. The Greek collective bargaining system is centralized, both at an intersectoral and sectoral level.



13. Collective agreements at specific companies and national or local occupational level cannot contain terms less favorable to workers than the terms and conditions of employment set out in the EGSSE. If more than one current SSE regulates an employment relationship, the one most favorable to workers applies. Furthermore, a collective agreement at industry or company level overrides an occupational collective agreement if both are concurrently in force.

14. All dependent salaried work is covered by the EGSSE. In addition, it is estimated that the various collective agreements cover 85% of workers.

15. In Greek law, the right to collective bargaining has been established as a right of constitutional order, is recognized as a social right and is set out within the framework of the Constitution, which states: “General working conditions shall be determined by law, supplemented by collective labor agreements concluded through free negotiations and, in case of the failure of such, by rules determined by arbitration.”

16. The Minister of Employment and Social Protection may decide to extend a collective agreement and declare it mandatory for all workers in a certain sector of economic activity if the agreement is already binding to employers employing 51% of the sector’s or profession’s workers. In practical terms, this means that, when an SSE is signed, all of the parties involved are bound by its terms and conditions irrespective of whether they are members of the representative organizations that took part in the bargaining on the SSE.

17. The principal mechanism used for settling labor disputes is OMED, which is primarily responsible for helping negotiating parties when negotiations come to a halt. However, strikes in Greece are mainly against government policy and the target of the relevant claims is the government, not employers in particular. In practice, this means that strikes do not end by filing an appeal with OMED, since the relevant claims are related to broader labor issues.

18. The All-Workers Militant Front is a coordination centre within the Greek trade union movement, founded on the initiative of Communist Party of Greece trade-unionists in April 1999. Amongst it membership are also cadres of Communist Renewal. PAME is critical of the official positions and leadership of the General Confederation of Greek Workers. The trade unions that are affiliated in PAME have 415,000 members in total as of 2005.

19. The shape of the Greek public sector was already established in the nineteenth century. From the inception of the Modern Greek state, provision of public-sector jobs was a preferred way for politicians to grant favors. Public sector jobs also provided opportunities for upward mobility in an economy whose development potential was unrealized until a very late stage.

20. Beginning about 1974, several factors have contributed to growth of the public sector. Greek governments responded to the economic crisis of the 1970s with a variety of policies that increased government spending in order to protect the public from the consequences of the economic downturn. This response was intensified by the need for democratic consolidation when the military dictatorship ended in 1974. It was enhanced further in 1981 when the first socialist government in Greek history brought with it a programmatic goal to modernize the Greek system of social protection.

21. After remaining at about 25 percent of GDP in the late 1960s and early 1970s, public expenditure began climbing after the mid-1970s; by 1980 it had reached 30 percent, then by 1985 it exceeded 40 percent. Since then the figure remained steady between 40 and 45 percent of GDP.

22. The basic components of this accelerating outlay are primary expenditures such as the purchase of goods and services, pensions, subsidies, and interest payments on the public debt.

23. The problem of enhancing public revenues is paramount for Greece's fiscal climate. Contrary to the practice in most European countries, Greek tax revenues come primarily from indirect taxation (sales, excise, and mainly, value-added taxes), and only secondarily from direct taxation (income, corporate profit, and property taxes).

24. The low yield of direct taxation in Greece is not the outcome of low tax rates. Rather, it is due to low income tax compliance. Tax enforcement is problematic in a country with a high percentage of self-employed workers and a large service sector. Greek tax collection is riddled with inefficiency, lax enforcement, and even corruption--factors that have survived numerous reform efforts.

25. Aside from the government and its agencies, the Greek public sector includes a variety of enterprises in various sectors of the economy. Some of these concerns enjoy monopoly status, such as the Public Power Corporation, the Greek Telecommunications, and Olympic Airways, which alone operates domestic air travel. Other public-sector enterprises, most notably national banks and manufacturing companies owned by them, coexist with private firms in their field of activity.

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