Kooperationen
High level of organisation
The Danish labour market is characterised by strong labour market organisations and a high level of organisation amongst employees and employers. This allows for a system where pay and working conditions are typically negotiated and imposed through collective agreements concluded between trade unions and employers' organisations. This system of labour market regulation is characterised by the fact that it is the social partners themselves that negotiate the majority of the rules on the labour market and this is referred to as the Danish model.
The origins of the present collective bargaining and agreement system is the September Agreement of 1899. As the conclusion of a long and hard dispute, employers and employees agreed that it was a matter of mutual interest to establish more formalised ways of cooperation and to mutually recognise each other.
The Danish labour market is not regulated by many government imposed laws as it is generally acknowledged that the social partners are in the best position to know what the problems on the labour market might be. There is thus a strong emphasis on the social partners' self-regulation and government imposed labour market laws are typically introduced in relation to employees who are not covered by collective agreements, special groups of employees or the laws apply to special situations. Examples of such laws are the Civil Servants Act, the Holiday Act, the Equal Treatment Act, the Equal Pay Act, the Working Environment Act and legislation regarding maternity leave. Some of these laws are also a result of Denmark's obligation as a member of the European Union.
General agreements
Collective bargaining rights rest on the general agreements concluded between representatives of the employers and employees. The general agreements between the main trade unions and employers' organisations are known as the constitution for the organised labour market. The general agreements set out the framework and regulations for collective bargaining, regulations regarding dismissals, the procedures to be followed in the case of disputes and violations of the collective agreements, the rights of shop stewards and establish the employer's right to manage and lead the workforce.
The general agreement between Kooperationen and LO, The Danish Confederation of Trade Unions, sets out the framework for a fixed procedure which must be followed in the case of labour disputes and violations of collective agreements. Unlike other general agreements, the general agreement between Kooperationen and LO does not allow the social partners to take industrial action if they fail to reach an agreement during labour disputes. If a dispute arises, the general agreement obligates the social partners to follow the agreed procedure which involves a number of negotiations between the directly involved parties and the social partners. The first meeting takes place between the management of the company and representatives from the local branch of the employee's union. They attempt to solve the matter and a summary of their meeting is signed by both sides. If they fail to solve the dispute, either party can request a dispute settlement which must be requested in writing and be put forward to the opposition's union. A conciliation council consisting of two members, each party appoints a member to represent their side of the collective agreement and thus Kooperationen represents the employer's side, comes together within 5 or 10 work days. If the conciliation council fails to negotiate a solution, one of the parties can request a special industrial arbitration called faglig voldgift. The special industrial arbitration is a central negotiation and it involves representatives from Kooperationen and LO, and the arbitration tribunal is set up for the purpose of hearing just the existing case. Each party appoints two members to the tribunal and they must agree on a fifth member, an impartial arbitrator. If an agreement cannot be reached with regard to the impartial arbitrator, then the Labour Court will appoint one. The parties each present their case and if the members of the tribunal cannot agree on a ruling, the impartial arbitrator will have the final say.
The general agreement also contains a fixed procedure for how to solve disagreements in connection with renewal of collective agreements. When the parties fail to reach an agreement, one party can request a joint meeting where representatives from Kooperationen and LO participate. The next step is to form a collective agreement committee consisting of 4 members, whereof Kooperationen and LO each appoint one member and the involved parties one each. The committee will try to reach an agreement through negotiation with the parties involved and if an agreement cannot be reached an impartial arbitrator will be appointed to lead the negotiations and to help the parties solve the dispute.
The general agreement between Kooperationen and LO specifies that in the case of dismissal, a person employed for a minimum of 9 months have a right to ask to be informed of the reason for the dismissal. If the employee's side does not find the dismissal rightful, they have the right to request a meeting between representatives of the management and of the employees. If the meeting does not resolve the disagreement, the employee's union can request a meeting with Kooperationen.
If they fail to reach an agreement, the employee's union can take the dispute to a special court of arbitration, the permanent industrial arbitration tribunal, where the fairness of the dismissal will be tried. This special court of arbitration has 5 members whereof Kooperationen has appointed two members and another two has been appointed by LO. They are all appointed for a period of 3 years. The umpire is appointed by Kooperationen and LO in agreement and he or she is appointed for a period of two years. In the arbitration proceedings the parties present their point of view verbally and the arbitrators will thereafter decide on the matter by simple majority vote. If there is no agreement between the arbitrators, the umpire will have the final say in the matter and a detailed award may be arranged if the dismissal is found to be unfair.
The general agreement between Kooperationen and LO is characterised by mutual respect. The trade union movement acknowledges that the members of Kooperationen need stabile work conditions to be able to succeed and in order to maintain their ability to compete and therefore the trade union movement will not demand higher pay or better working conditions than what is expected from similar private companies. On the other hand, Kooperationen acknowledges that the aim of the trade union movement is to gain the best possible working conditions for employees and Kooperationen is committed to do their best in ensuring employees safe and proper working conditions. The general agreement between Kooperationen and LO commits the organisations to work for orderly and stabile working conditions through the implementation of cooperation committees.
Cooperation agreements
Cooperation agreements are also an integral part of the relations between the social partners on the Danish labour market. The aim of the cooperation agreements, drawn up by the social partners in the private, cooperative and public sectors, is to ensure a systematic cooperation between management and employees. The cooperation agreements specify that employers must exercise the right to manage in cooperation and via interaction with employees and their shop stewards, with the goal of improving competitiveness, employment, the working environment and job satisfaction.
This task is carried out in large companies by joint consultation committees comprising representatives elected by management and employees in equal proportion and the employees' elected union representatives are natural members. The cooperation agreement between Kooperationen and LO obligates the companies to form a cooperation committee when they employ more than 20 people. Other cooperation agreements have a minimum number of 35 employees. In companies with several work addresses, the company is obligated to form subcommittees. The committees receive information on the company's financial situation and prospects, employment, major changes, including restructuring and the introduction of new technology. The employees' representatives are obligated to keep the cooperation committee informed about the employees' view on working conditions and other aspects which have an impact on the company's working climate.
The cooperation committee lays down the guiding principles for local working conditions and welfare, including personnel policy, training and continuing training in respect of new technology and the use of personnel data. If the introduction of new technology results in redundancies, the company is obligated through the cooperation agreement to seek to transfer or retrain the individual employee for other work in the company. The cooperation agreement between Kooperationen and LO also obligates the employer to inform the respective shop steward 14 days in advance in the case the management intends to dismiss a member of staff who has been employed for more than 12 months.
The cooperation committee holds 6 general meetings annually, unless a different number has been agreed locally. The cooperation committee is obligated to keep all employees informed about the work performed by the cooperation committee. In special cases, the members of the committee might be bound to secrecy in respect of information shared in the meetings.
Each cooperation agreement has a Cooperation Board attached to it which is charged with counselling and development work to further cooperation in companies. The Cooperation Board established by Kooperationen and LO is composed of 8 members, 4 representatives from each side. In order to assist the Cooperation Board, a secretariat has been set up to which both Kooperationen and LO has appointed consultants. The consultants handle the board's day-to-day business and plan the work of the board. The secretariat assists both management and union representatives in all matters concerning their work on the local cooperation committees. Disagreements concerning the interpretation of cooperation agreements are settled through local discussions; if necessary the members of the committee can consult the Cooperation Board. If the parties fail to solve the dispute, either party may bring the matter before the Cooperation Board. The Cooperation Board will attempt to resolve the dispute through talks with the parties involved and possibly with their trade unions and employers' union. As a final solution, an arbitrator will be appointed and the dispute will be dealt with by the board according to the general guidelines governing arbitration in industrial disputes. A penalty may be imposed, if the matter is found to breach the main cooperation agreement.
