Stalemate in Polish social dialogue hinders recovery from the crisis

Poland appears to be a model pupil for CEE countries when it comes to going through the worldwide economic crisis. But one should interpret the overall admiration with caution, because a deeper look into the statistics reveals that the social situation in the country is not always as comfortable as the economic development might indicate. Especially the social dialogue is under pressure and faces several threats, also by the Polish government.

Poland has been going through the global crisis in a relatively mild way if economic indicators only are taken into consideration. Since 2008 the Polish economy didn’t note any decrease in GDP growth unlike other EU countries. In the most critical year for Europe – 2009 – Poland was the only country with – significantly lower than in previous years but still – a positive GDP growth rate at the level of 1,6%. The growth was noted in almost all industrial sectors with some exceptions (i.e. construction sector). This exceptional immunity to the biggest economic crisis since the Great Depression (1929-1933) aroused some admiration or at least some interest in Europe. Polish PM Donald Tusk (Civic Platform) built up a PR strategy for his government on the vision of “green island of growth in the middle of the red sea of Europe plunged in the crisis”.  Moreover, a few years later in June 2014 the Economist dedicated one of its editions – especially the opening article: ‘The Second Jagiellonian age’[1] – to Polish economic prosperity after 1989 highlighting also successful coping with the Global Crisis.

However, the image of “the green island” was based on a selection of indicators and presented only a part of the whole story. Since 2008 together with a positive GDP growth also negative tendencies – especially in the social domain – have been observed: a significant rise of unemployment by 3,2 pp (from 7,1% in 2008 to 10,3% in 2013; unemployment in the group under 25 years of age by 10,1 pp: from 17,2% in 2008 to 27,3% in 2013[2]), raise of extreme poverty by 1,8 pp (from 5,6% of households in 2008 to 7,4% in 2013[3]), stop in increase of real wages (especially in 2011 and 2012) and decrease of labour force by 240 thousands (from 15,80 mln in 2008 to 15,56 mln in 2013[4]). Moreover, public finances have been experiencing significant difficulties even despite some improvements in 2011. In parallel to the declining social conditions enterprises have been noting each year a constant growth of net profitability: 4,1,% in 2009, 4,4% in 2010, 3,9% in 2011, 3,6% in 2012, 3,7% in 2013[5]. In May 2014 Central Statistical Office reported on growing economic inequalities between first and fifth quintile of Poles: the proportion of spending to income in the former group rose from 119,6% in 2010 to 133,8% in 2013, while in the latter group the proportion decreased from 73,2% in 2010 to 71% in 2013[6]. It might be concluded that it is the society – especially the employees and disadvantaged groups – that has taken the hit of the crisis in Poland[7].

Together with the social crisis also a severe crisis in an institutional social dialogue between trade unions, employers’ organizations and the government at central level has been observed. The essence of the crisis has been diagnosed as reluctance to social dialog from the side of the government[8]. Despite some accelerations and agreements in the Tripartite Commission at the very beginning of the new coalition of Civic Platform and Polish People’s Party’s office period that has started in 2007, dynamics of the dialogue were in a significant decline under the ruling of Waldemar Pawlak (Chairman of the Tripartite Commission, vice-PM and Minister of Economy) and under Władysław Kosiniak-Kamysz (Minister of Labour and Social Policy), replacing him in the Tripartite Commission.

A trigger to the crisis was that the government intended to introduce flexible working time into the Labour Code as a general regulation at the end of 2011 as a continuation of temporal regulations from the anti-crisis legislative Act (operating in 2009-2011). Regardless the disapproval of trade unions, the Ministry of Labour prepared a draft amendment to the Labour Code which has been adopted by the Parliament (majority of the coalition votes) and the President. In the years 2011 and 2012, the reform of retirement age has been also insufficiently consulted with social partners and other civic bodies. Finally, it has been adopted in Spring 2012 by the parliament and the President and came into force in 2013. The reform rose the common retirement age for both men and women up to 67 years of age (from previous 65 for men and 60 for women). During the whole period ignorance of a social dialogue continued from the side of the government. In June 2013, all representative trade unions suspended their participation in the Tripartite Commission and other consultative bodies, and demanded withdrawal of the amendment to the Labour Code on flexible working time and dismissal of the Minister of Labour.  In reaction to the negative response of the government, trade unions announced an Inter-union Protest Committee and the organization of a ‘National Days of Protest’ in Autumn 2013.

The protest proved to be a success gathering over one hundred thousand people dissatisfied with the role of social dialogue especially in regard to tackling current effects of the economic crisis (unemployment, poverty, etc. as mentioned above). Participants of the protest varied from right-wing to left-wing organizations, social movements and obviously trade unions. Political parties were not allowed to join in order to avoid any political affiliation and political campaigns. For the first time since 1989 trade unions were able to voice social attitudes and organize various circles around their actions. Nevertheless, the National Days of Protests did not have any effect on the governmental decisions nor recovery of social dialogue except the expression of discontent.

During the last year the social partners has been consulting autonomously proposals for the reform of the social dialogue institutions as an effect of the break down in the Tripartite Commission. Unfortunately, until now (November 2014) there is no agreement on the final shape of the system.

The lack of institutional social dialogue equals to the lack of the social partners’ impact on public policies mitigating effects of the economic slowdown and the social crisis. The breakdown of social dialogue now enables the government to make decisions without any institutional resistance and act unilaterally in the implementation of austerity measures, which takes place in fact. Limited impact of social partners on governmental and parliamentary decisions was a feature of central social dialogues also before the suspension of trade unions’ presence in the Tripartite Commission, but since 2011 the government arbitrariness has expanded strongly. The current and previous two governments led by PM Donald Tusk were supported by the majority in the Parliament, so governmental bills and other draft legislation proposals easily passed the votings. Furthermore, the decision making process has lost much on transparency while it is not observed and discussed with the social partners. The only form of pressure on the government – made mostly by trade unions – is organizing strikes, writing official letters presented to the public, or taking part in the public debate in the media. These actions, however, have almost no influence on the decisions taken by the government. The most effective way to influence the Polish government is to bypass it by filing complaints to international bodies i.e. ILO or the European Commission. This is a strategy pursued by trade unions nowadays. However, this solution might be adopted only in case of a violation of law (national or international), but it is not the appropriate instrument to consult provisions of current legislative acts and other public decisions.

In October 2014 a new coalition government has been formed by Ewa Kopacz – the new leader of the ruling Civic Platform, while the previous PM Donald Tusk was elected President of the European Council. In her exposé, which was very much awaited by the public including striking coal miners in Silesia region at that time, any reference to the necessity of a social dialogue reform didn’tappear. Under such circumstances the prospects of a strategy change towards social dialogue, which might be adopted by the coalition and the new government, look rather pessimistic. The stalemate in the social dialogue at central level and unchanged approach of the coalition towards social dialoguecalls into question thefull implementation ofthe European Social Modelin Poland – particularly in relation topolicy makingaimed atrecovering fromthe economic crisis,which in Polandtook mainlythe form ofa social crisis.

Fotocredit to Dawid Krawczyk via Flickr

Footnotes:

[1] The Second Jagiellonian age, The Economist, 28 June 2014, http://www.economist.com/news/special-report/21604684-first-time-half-millennium-poland-thriving-says-vendeline-von-bredow

[2] Eurostat database

[3] „Ubóstwo ekonomiczne w Polsce 2013” [Economic poverty in Poland 2013], Central Statistical Office, 2014

[4]Eurostat database

[5] Central Statistical Office database

[6] „Sytuacja gospodarstw domowych w 2013 r. w świetle wyników badania budżetów gospodarstw domowych” [Situation of households in 2013 froem the perspective of results of study on households’ budgets] Central Statistical Office, 2014, p. 8

[7] For more see: Czarzasty, J., Owczarek, D. (2012) The economic crisis and social dialogue in Poland / Kryzys gospodarczy i dialog społeczny w Polsce, Institute of Public Affairs, Warsaw http://www.isp.org.pl/site.php?id=1&pub=565&lang=2

[8] Gardawski, J. (2014) Polish social dialogue reaches critical juncture, Eurofound PL1402029I

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