By Rafael Muñoz de Bustillo Llorente

1. INDUSTRIAL RELATIONS AND INEQUALITY
IN THE SPANISH LABOUR MARKET.
RESILIENCE AND CHANGE
Rafael Muñoz de Bustillo
University of Salamanca
Inequalities and the world of work: what contribution of
industrial relations and social dialogue?
Session 1: Trends in Industrial relations and inequalities:
How do they influence each other?
Brussels,23-24February2017

2. Highlights of the system
• Social partners play a Major institutional role: “Trade unions and employers
associations contribute to the defence and promotion of the economic and social
interests which they represent” (art. 7, Spanish Constitution).
• Long tradition of social dialogue since de Democratic Transition (1977) of different
types (bi-partite, tri-partite, national, regional, local).
• Comparatively low (17%) but stable affiliation rate but high participation in Trade
Union elections (67 %).
• Large share of very small firms: 83% of firms with employees < 5 employees. Of
those with more than 5 employees 27% belong to a business association.
• The system of automatic extension of Collective Agreements allows for a large
coverage of employees

3. Coverage of Collective Agreements in Spain
1999-2014 (% of all employees covered)
77.9
69.3
72.1
0
10
20
30
40
50
60
70
80
90
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

4. This large coverage of Collective Agreements contributes to a
lower level of inequality in working conditions
Australia
Austria
Belgium
Canada
Czech R.
Denmark
Estonia
Finland
FranceGermany
Greece
Hungary
Iceland
Ireland
Israel
Italy
Japan
Korea
Luxembourg
Mexico
NetherlandsNew Zealand
Norway
Poland Portugal
Slovak R.
Slovenia
Spain
Sweden
Switzerland
UK
USA
y = -0,677ln(x) + 6,015
R² = 0,3406
0,0
1,0
2,0
3,0
4,0
5,0
6,0
0 10 20 30 40 50 60 70 80 90 100
Wageinequality(D9/D1)
CA Coverage rate (%)
Source: Author´s analysis from OECD Labour Database and Visser (2015)
Wage inequality and CA coverage rate before the crisis (2008).

5. • The equalizing effect is explained by the
homogenization impact of CA most of which
are of higher than firm level: 91 % of
employees.
• Analysis with 2014 Structure of Earnings
Survey microdata show that firms with
collective agreement at the level of the firm
have higher wage inequality within the firm
(compared to regional) .

6. …………. change
• The major (non-negotiated) labour reforms
approved during the crisis (2010/11/12)
affected the system of industrial relation by:
– Facilitating the non application of collective
agreements under certain circumstances.
– Giving priority to firm level collective agreement
over the rest.
– Reducing the automatic time extension of expired
collective agreements to 1 year.

7. Was it needed?
Firms quite satisfied or very satisfied with their Collective Agreements*
82,0 78,3
82,7 82,1 82,0 79,9 83,8 83,4
0
10
20
30
40
50
60
70
80
90
Total Firm CA Higher than
firm CA
From 5 to 9
employees
From 10 to
49
employees
From 50 to
249
employees
From 250 to
499
employees
More than
499
Firms(%)
2014
2013
* Only firms with 5 or more employees
Source: Author´s analysis from Encuesta Anual Laboral, Ministry of Employment and Social Security

8. • No major change in coverage rate
• Relatively low use of the possibility of
implementation of CA (3,75 of firms with
sectoral CA in 2014)
• Social agreement to maintain the extension of
expired CA
• No major change of use of firm level CA
…….and resilience

9. …………….. but
• There has been a change in the power
leverage between firms and Trade Unions
(now on the defensive)
• The elimination of many of the existing check
and balances has led to the emptying of CAs
(Cruces et al., 2016), especially regarding
wages; to a position of defensive bargaining
by TUs aiming at maintaining CAs themselves.

10. T h a n k s