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Aleksandar Lojpur, Lawyer, Belgrade: Overview on the Development of Labor Law in Times of Neo-Liberalism

Speech at Conference: "
Human Rights and Democracy in the Context of EU Enlargement  – Western Balkan Perspectives", organized on June 6, 2014 in organization of European Association of Lawyers for Democracy and Human Rights (ELDH) and Lawyers for Democracy (LawDem), Belgrade in cooperation with Lawyers Committee for Human Rights (YUCOM), Belgrade 

 

Workers’ rights, or, if we use terminology of so called neo-liberalism – employees’ rights, make very important part of human rights recognized and respected in democracy. No wonder, therefore, why organizers of this conference devoted important part of the conference to this issue.

Can a community, or a state, in which workers have no rights, or their rights are not respected and/or protected, call itself democracy.  Answer, of course, is negative.

Unfortunately, in Serbia, this important part of human rights, workers’ rights, for more than 50% of  labor active population is neither respected nor protected. Hence, although on paper we have all laws and institutions in place  needed for workers’ rights to be granted and guaranteed, respected and protected,  Serbia is not yet a democracy.

Document called Labor Law is a very well written document, as we do have indeed another nicely written document called Constitution. But the problem is, that our Government does not enforce the labor legislation,  or, to be more precise, does so little in enforcement of the law that we can freely say that that it does not do anything.

When a law is not applied in practice, in our Serbo Croat language we say that it is “mrtvo slovo na papiru” – literal translation of this expression into English would be “dead word on the paper.” That is exactly what it is, Serbian Labor Law, for majority of those who are supposed to relay on it.

And here my contribution to this conference might come to its end. However, to end with this bitter conclusion would not be constructive at all. Let us, therefore, see what does this dead word on paper say, how come we say it is dead and let us try to make some analysis why it is dead.

Before we go into details, let us see who are participants in Serbian labor market.

Transition in Serbia failed. We did not succeed in transforming the economy and the country as whole  into a democracy. The best analysis of this failure I read was given by Goran Musić in his book recently published by Serbian office of Rosa Luxemburg Foundation in 2013 under title “Serbia’s Working Class in Transition 1998-2013, available at the web site  www.rosalux.rs.http://www.rosalux.rs/userfiles/files/Goran_Music_Working_Class_Serbia.pdf

 

I strongly recommend this book to anybody interested in socio economic developments in post Yugoslav sphere.

 

Here is what Musić’s analysis says about working force in Serbia:

The first thing that catches one's attention is the relatively high percentage of economically non-active citizens. In 2009, the share of active citizens stood at 49 per¬cent of the total working age population. In comparison, the average share of economically active citizens in the EU countries that same year was 71,3 percent.33 At the same time, more than 16 percent of the Serbian population, still registered as economically active, was officially unemployed.

This leaves the country of 6,5 million inhabitants above 15 years of age, with merely 2, 9 million officially economically active citizens, among which more than half a million were officially unemployed and only around 1,7 million were wage workers.34 Keeping in mind that the number of pensioners reached 1,6 million people by the end of 2009, one can conclude that Serbia has almost 2 million citizens, between the age of 15 and 65, who either slipped into the informal the informal sector or remain long term unemployed with no personal income.

 

 

Now, let us see shortly what does the dead word on paper say

1. The Law

Serbia is signatory of all relevant international conventions.

“The country has ratified 72 ILO International Labour Standards (Conventions), including the eight fundamental Conventions.” Quote from web site of International Labor Organization.

 

Serbia, as candidate member for the EU since 2012 ratified in 2009 also European Social Charter.

 

Serbian Constitution in its Art 16 section 2 says: Generally accepted rules of international law and ratified international treaties shall be an integral part of the legal system in the Republic of Serbia and applied directly. 

 

This provision of the Constitution means that above mentioned treaties, that is 72 ILO Conventions and European Social Charter have the same force as any law adopted by the Serbian Parliament. Therefore, these documents are also part of the Serbian labor legislation.

 

Finally, the most important part of the labor legislation of Serbia is Law on Labor.

 

The Labor Law in force today has been adopted in the Parliament on 2005, and it has been amended in 2009 and 2013. Very soon this law will be changed, most probably in the next two to three weeks. Some of the rights granted to workers by the law in force today will be decreased.

 

Part of Serbian Labor law are also collective agreements concluded on the basis of the Law on Labor between representative organizations of employers and representative workers associations, in Serbia known as “sindikati” or in English- trade unions.

 

The law in force today gives to workers all rights as provided for in ILO conventions and European Social Charter, I shall mention here some of them:

-      Limited working hours (40 hours a week)

-      Increased payment for work after hours

-      Increased payment for work during night, weekends and holidays

-      Collective bargaining

-      Right to paid daily break, right to aid weekly break and paid yearly vacations (minimum 20 days)

-      Remuneration for meal during the working day

-      Remuneration for expense for transportation from home to work

-      Minimal wage

-      Protection from discrimination

-      Protection from discriminatory termination of contract

-      Right to organize in trade unions

-      Right to compensation (otpremnina) in the case of unprovoked termination of employment contract for every year of work experience,

 

The law in force today says that employment contract may be permanent, for a unlimited term, and under specified conditions defined by the law (seasonal works, work on a project for limited time, business of employer is expected to be more work force demanding for certain period of time)   temporary or for limited period of time. If the contract is concluded for limited period of time, maximum time is one year. If the employee continues to work after one year of limited time contract for five working days limited time contract will be transformed into permanent employment contract.

 

As we speak today there is a vivid debate about changes of the Labor Law. Government adopted the policy of “flexible labor market”, in hope that decreasing or lightening the financial  burden for employers by decreasing rights of employees, will have as a result raise of employment rate. Few days ago, on Monday this week (June 2, 2014), government announced that text of the new law has been agreed with two major trade unions and representative employers association. Employers requested that limited term employment contract may be for three years, trade unions requested that it remains as it is, one year, and compromise has been achieved that it will be two years. Employers requested that minimal wage be erased from the law, this has not been adopted. Compensation for unprovoked termination of contract is to be paid only for the time of work with the last employer. Very important change, about which trade unions say that there was no consent is the obligatory application of collective agreements. According to draft law submitted this week to the parliament, application of collective agreements concluded between representative associations of employers and workers’ unions is not mandatory. Two major workers associations issued joint statement that this has not been agreed in the three months negotiation process and that government  misinformed the public when it announced that agreement has been achieved.

 

The Reality

 

Now, after we saw what is written on the paper, what labor legislation says, we came to the point when I have to give more clarification why I said at the beginning that these words, written in legislation, are, as we say in our Serbo Croat language “dead words on paper” or “mrtvo slovo na papiru”, at least for majority of workers.

 

The state simply does not have enough resources to implement these laws. On the web site of Democratic Center “Politickiforum.org” I found protocols of a conference “Work with dignity in Serbia, Standards and Practice” (“Dostojanstven rad u Srbiji, standardi i praksa”) that took place in 2012. Representatives of government, trade unions and organizations of employers analyzed labor laws standards and practice in Serbia. According to Deputy Labor Minister at that time, Radmila Bukumirić — Katić, there are only 260 labor inspectors in the whole of the country. The Ministry estimates that there are about 650.000 informally employed workers. Labor inspectors made in first six months some 15.000 inspections and discovered some 3000 unregistered workers. At the same conference, former chief of  labor inspectors Radovan Ristanovic said that breach of legal provision that labor contract for a limited period of time may last only one year, became so massive that labor inspectors could not even initiate procedure of inspection and subsequent punishment for these breaches.

 

We had here in Serbia very specific way of transition (from unique socialist self-management system which was more free market oriented than today’s unique system of state controlled capitalism we have now). It had three phases, I am not going to analyze them, I will just enumerate them: From 1988 – 1991 (so called Ante Markovic reforms), From 1992 – 2000 and from 2001- until today (that Musić defined as period of colapse of neo-liberal model). I suggest to members of audience at our conference today to read very good analysis of Mr. Musić presented in his above mentioned study “Serbia’s Working Class in Transition 1998-2013”.

 

The analysis of self-management system is presented in my paper “Kardelj – Tvorac utopije ili alternative ‘Liberalnoj demokratiji’” (“Kardelj – Creator of utopia od alternative to ‘Liberal Democracy’”) available in Serbo-Croat language at www.lojpur.eu.

 

Recommendations

 

In conclusion, allow me to present my views on further development of labor law.

 

Firstly, the government should cease the policy of attracting new investments by lowering the cost of labor. No serious investor will come because of low wages for his workers. Rights of workers should remain the same, if not increased. Instead of trying to decrease work conditions and workers’ rights in public sector the government should enforce the labor law in private sector and secure that labor rights and social benefits given to employers in  public sector be granted to workers in private sector.  

Secondly, the government should encourage establishing of workers shareholding companies with presently unemployed workers, and in cooperation with trade unions. Sectors which government sees as priority for development should be developed by governmental subsidies, cheap loans from development bank, given to interested unemployed workers.

Thirdly, there are presently 153 big enterprises “under restructuring” employing 52000 workers and some 900 enterprises which are not yet privatized or that were unsuccessfully privatized. Instead of spending estimated billion euros yearly on keeping these companies alive, the government should offer these companies to employees free of charge in the case there is interest on the side of employees that these enterprises continue to work. The amount of billion euros yearly instead should be used for state guarantees for loans to those companies that do have profit making possibility.Type the content of your page here