After enlargement: preconditions and prospects for bargaining coordination

EU enlargement, by extending the boundaries of Europe's single market, calls for a reconsideration of the preconditions and prospects for transnational coordination of collective bargaining. Collective bargaining still remains nationally-based, but after enlargement two features are prominent. First, there is the extent of the gap in labour costs between the old and new Member States. This is providing powerful incentives both for the movement of capital eastwards (relocation of production sites) and for movement of self-employed workers westwards (displacing local labour). Secondly, there is now a group of countries with single-employer bargaining systems: multi-employer bargaining is no longer the EU norm. The resulting pressures are reinforcing developments in sectoral agreements, such as ‘hardship clauses’, which themselves undermine the vertical coordination on which successful cross-border coordination must rest. This paper analyses the implications of these developments and concludes that sector-based cross-border bargaining coordination remains trade unions' best available response to pan-European market integration; that differentiated approaches are required as between sectors; that unions need to develop effective means of coordination across companies within sectors; and that, under single-employer bargaining regimes, boosting union organisation and hence the coverage of collective bargaining is paramount.