Workers’ unions across Europe have launched a campaign for the EU to only give public contracts to companies that have collective bargaining agreements with their workers.
Suppressing workers’ collective bargaining rights has a cost to both workers and to society. Within the services sectors, our new research shows that workers who are excluded from collective bargaining agreements in the EU are missing out on €25 billion per year in lost wages and public revenue is down a combined €28 billion per year in lost tax and social security contributions.
Collective bargaining coverage is decreasing in Europe: in 2010, 72% of workers were covered by agreements on pay, in 2018 it was down to 66% of workers covered. Increasingly companies are pulling out of sectoral collective bargaining agreements, particularly on pay.
The EU can play an important role in changing that. One important lever is public procurement. This accounts for 14% of the EU’s GDP or €2 trillion. Currently, the EU’s public procurement rules are skewed to favour price over all other considerations. Under these circumstances, corporations consistently turn to undercutting working conditions by suppressing their workers’ fundamental collective bargaining rights.