{"id":862,"date":"2024-04-17T13:45:32","date_gmt":"2024-04-17T11:45:32","guid":{"rendered":"https:\/\/www.rivistaeco.com\/?p=862"},"modified":"2024-05-27T19:47:39","modified_gmt":"2024-05-27T17:47:39","slug":"fair-prices-for-farmers-it-also-depends-on-us-2","status":"publish","type":"post","link":"https:\/\/www.rivistaeco.com\/en\/2024\/04\/17\/fair-prices-for-farmers-it-also-depends-on-us-2\/","title":{"rendered":"The Rise of Pirate Contracts"},"content":{"rendered":"

In Italy, the number of collective labor agreements has skyrocketed over the last twenty years. This surge has led to the proliferation of so-called “pirate contracts” and a deterioration of working conditions, especially in terms of wages.<\/span><\/p>\n

In 2005, approximately 300 national collective labor agreements were registered with the CNEL \u2013 the National Council for Economics and Labor. By 2012, this number had risen to 550, and by 2023 it reached 977: an increase of 225% in less than twenty years.<\/span><\/p>\n

Why such a such rapid and intense growth of collective agreements? A combination of factors has become chronic over time: the increasing fragmentation of social parties, the erosion of trade union and employer representation, and the entry of new actors in the field of industrial relations. However, the proliferation of collective agreements also stems from a legislative void regarding the criteria for defining the representativeness of social parties, which, despite various attempts, remains difficult to measure and certify.<\/span><\/p>\n

Why the Number of Contracts is Growing<\/b><\/h3>\n

The increase in the number of collective contracts has weakened the industrial relations system in our country, either because of the uncertainty associated with choosing the contract (which of the many?) and the minimum wages to be applied, and or because it has triggered a race to the bottom, based on economic convenience rather than the representativeness of the signing organizations. Of the nearly a thousand collective contracts deposited with the CNEL, only a portion are signed by worker and employer organizations historically considered as “comparatively more representative on a national level,” the majority are instead signed by little-known or outright unknown organizations, where often the differences between the employer and union side are unclear. The emergence of new employer and union associations seems motivated by various factors, starting from divisions within employers\u2019 associations, the search for niche bargaining, and a highly fragmented Italian production system. Moreover, signing a national contract provides significant benefits, including access to training funds and the management of social welfare and support institutions. While some barriers have long protected and strengthened the historic representative organizations, today the legitimation for collective bargaining is self-proclaimed simply by signing a contract and submitting the agreement to the CNEL as required by law, precisely because there is no shared criteria for identifying the most representative organizations.<\/span><\/p>\n

What are ‘Pirate’ Contracts?<\/b><\/h3>\n

These contracts are thus called “pirate” because they are signed by little-known or non-representative employer and union organizations, and they often stipulate economic conditions and labor protections that are worse for workers. Such contracts then lead to unfair competition with companies that adopt agreements signed by more representative organizations that better protect workers. But what\u2019s in non-representative or “pirate” contracts? Who does signs them, and in which sectors? Who does declare \u00a0a contract “pirate” and possibly sanctioning it? What are the consequences or possible solutions?<\/span><\/p>\n

From the retail and hospitality sectors to security services, tourism, and transport, the examples of pirate contracts are many. In the retail sector, besides the reference contract of “Tertiary, Distribution and Services” signed by the confederal unions (CGIL, CISL, UIL) and Confcommercio, representing more than 2.3 million workers and 381,000 companies, there are more than thirty national contracts. In the transport sector, alongside the contract for “Logistics, Freight Transport, and Forwarding” signed by confederal unions and the main transport confederations, there are dozens of others. In all cases, the “national” pirate contracts cover only a few thousand workers, sometimes just a few hundred. In all cases above, the working conditions defined there are worse than those stipulated in “standard” contracts: sometimes they include one less monthly payment, sometimes lower minimum wages, and almost always do not provide any wage increases\u00a0 during the agreement’s validity. In short, working conditions are certainly worse.<\/span><\/p>\n

Do We Count Collective Agreements or Weigh Them?<\/b><\/h3>\n

According to an inspection conducted in 2023, collective agreements signed by the main confederal unions represent about 21% of the total registered\u00a0 in CNEL and INPS. About 53% are signed by unions represented at\u00a0 CNEL, while 36% concern other union organizations. To know the number of workers actually covered by the various collective agreements signed by different organizations, it is necessary to simplify and look at the data on the application of each contract in the relevant sector – keeping in mind that INPS archives only contain information on 80% of the private sector employees, so something might be missing. Now,out of the total employed workers whose contract is known (about 5% of employers do not declare the applied contract), the percentage of those covered by a contract signed by confederal unions is about 97% (13 million and 400 thousand) of the total, while 0.4% (just over 54 thousand people) work under a contract signed by minor non-representative unions.<\/span><\/p>\n

The comparison between the number of collective agreements and the number of covered workers indicates that the proliferation of pirate contracts has mainly affected sectors where micro-enterprises are more common (in sectors such as commerce, construction, logistics and transport, service ) and where employment relationships are fixed-term and short-duration. This is confirmed in an article published on the website <\/span>lavoce.info<\/span><\/i> by Andrea Garnero and Francesco Armillei. Using information \u00a0 about the goodwill to work within the Ministry of Labor (which includes agricultural workers and domestic workers excluded from the communication to INPS the two authors show how the share of workers hired under non-representative contracts is higher than 2.5% among domestic workers, in construction, in transport, and in business support services. Although these data also confirm that workers hired under contracts signed by the major unions are the majority, the share of workers covered by pirate contracts still reaches almost 13%. Among the Italian regions, non-representative contracts are more common in Abruzzo, Lombardy, Umbria, Sicily, Campania, Molise, Calabria, Friuli, and Sardinia.<\/span><\/p>\n

Who does Control Compliance with Minimum Wages?<\/b><\/h3>\n

A superficial reading of these data leads many commentators to conclude that the problem of pirate contracts does not exist or that, in any case, it concerns a limited number of employment relationships. This reading lacks the fact the presence of pirate contracts extends its influence on all contracts, ultimately worsening the conditions, especially the wages: the existence of such unfavorable conditions in the market can indeed trigger a race to the bottom and a system of blackmail against the weakest workers. Adding to this is the fact that the contract declared by the employer to INPS often does not coincide with the one actually applied or with the compliance with the economic and regulatory conditions provided in the reference contracts. Figure 2 shows some results of a study that analyzed, for Italy, compliance with the minimum wages indicated in the collective agreements signed by the confederal unions in the relevant sector.<\/span><\/p>\n

Estimates show that, on average, between 15 and 30% of workers (full-time and employed all year) receive a salary lower than the minimum wages defined by the sector’s collective agreement. Numbers that in some sectors – such as agriculture or commerce or categories of workers, such as fixed-term or young employees, affect almost 1 in 5 workers.\u00a0<\/span><\/p>\n

But how much do workers lose in terms of wages when a pirate contract is applied to them? In a recent article of ours,, we analyzed the minimum wage rates of contracts present in the CNEL-INPS archives, comparing those signed by confederal unions with pirate ones. The results show that the latter involve, on average, wages that are 10% lower, not to mention any lesser allowances or increases for overtime (table 1). However, the fact remains that the statistical sources available on collective agreements and wages are missing . The data are mostly taken from the administrative archives of declarations made by the employers themselves to INPS, or from surveys where the analysis sample is formed by companies with more than ten employees. Estimates of non-compliance with minimum wages, therefore, are likely to be\u00a0 discordant and\u00a0 lower than the reality. In other words, the race to the bottom is pursued by underpaying workers, with behaviors barely legal. . Without widespread and thorough union representation or vigilance,\u00a0 tackling these behaviors is very complex. The private nature of the contract indeed leaves a wide margin of discretion to employers, and choice is left to the\u00a0 worker to see the judge or not in order to request a fair and legal wage\u00a0 As established by the Supreme Court, it is up to the judge to decide whether a contract is “pirate” and whether the remuneration is fair, even in the case of contracts signed by the most representative organizations.\u00a0<\/span><\/p>\n

Finally, the debate on the minimum wage and, more generally, on poor work in Italy has, focused on the issue of the representativeness of national collective agreements, without addressing the bigger problem of low wages and why for decades tthe workers\u2019 purchasing power has stagnated. The European directive on adequate minimum wages\u00a0 is a unique opportunity to bring order to the jungle of contracts. Introducing a legal minimum wage, an issue shelved by CNEL, is one of the measures in the right direction.. Various bills on the minimum wage have been waiting for years to be discussed in Parliament. There is a need for a healthy debate that avoids opposing collective bargaining and legal minimum wage, providing instead provides an answer to the millions of poor workers. The government and social parties must give some answers.\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

In Italy, the number of collective labor agreements has skyrocketed over the last twenty years. 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