Effect given to the recommendations of the committee and the Governing Body - Report No 350, June 2008

Case No 2502 (Greece) - Complaint date: 20-MAY-06 - Closed

Effect given to the recommendations of the Committee and the Governing Body

1. 82. The Committee last examined this case, which concerns Act No. 3371/2005 which enables employers/banks to unilaterally denounce collective agreements concerning the supplementary pension funds of bank employees, and then provides that the funds in question will be obligatorily integrated into a single public fund, at its November 2007 meeting [348th Report, paras 90–95]. On that occasion, the Committee requested the Government: (i) to resume full and frank consultations with the complainant Greek Federation of Bank Employee Unions (OTOE) and banks as soon as possible, in order to ensure that the future of the supplementary pension funds of bank employees and of their assets is determined by mutual agreement of the parties to the collective agreements by which the supplementary pension funds were set up, and to which only they contributed, and to amend Act No. 3371/2005 to reflect the agreement of the parties; (ii) noting that the Government had not provided any information in respect of the Committee’s recommendation to amend section 2, paragraph 3, of Act No. 1876/1990 so as to ensure that supplementary pension schemes may be the subject of collective bargaining, the Committee requested the Government to keep it informed of any steps taken in this regard.
2. 83. In a communication dated 30 October 2007, the complainant (OTOE) indicates that it called upon the Government to organize and ensure a reliable and sincere dialogue at high governmental level with the presence of the Minister and the parties concerned (OTOE, banks), starting at point zero, with the aim to conclude agreements which would lead to the reform of the legal framework. During the second meeting, which took place on 18 October 2007 at the Ministry of Employment, OTOE was found for a second time facing the following situation: the Government was represented by the General Secretary of the Ministry of Employment, whereas the banks were represented by minor executives, who, after handing over to the Government letters on behalf of their management, declared that they did not participate in any dialogue procedure and that they would remain at the meeting only as observers. In commencing the dialogue procedure, the representative of the Government informed OTOE that (i) according to the content of the letters by the banks, they “are not willing to participate in any consultation or negotiation procedure in the framework of the ILO decision, considering that they are fully satisfied with Acts Nos 3371/2005 and 3455/2006 which they already apply”. (ii) The Government will in any case defend the legal framework (Acts Nos 3371/2005 and 3455/2006) but is willing to receive proposals from OTOE and will eventually proceed to amendments in the existing legal framework, if considered necessary. OTOE strongly reacted to this and pointed out to the Government representative that the procedure does not follow the ILO recommendations; it asked the Government to guarantee a new procedure of genuine consultations between OTOE and the banks during which OTOE could submit its proposals and which would lead to new agreements (in the framework of the ILO decisions) and necessary changes to the legal framework, according to the new agreements that will be concluded. The Government’s response was negative, which confirms that the consultations organized by the Government are merely perfunctory.
3. 84. The complainant adds that instead of adopting the recommendations and taking the necessary initiatives to ensure sincere and constructive dialogue, the Government once again proceeded hastily to unacceptable legislative intervention in the supplementary pension fund of the Agricultural Bank of Greece. Despite the strong protests of the Agricultural Bank Employees’ Association, the Government has transferred since 1 January 2007, their supplementary fund to a public fund, namely, the Single Fund for the Social Insurance of Bank Employees (ETAT). It has also proceeded to a new phenomenal legislative regulation (section 9, Act No. 3554/2007) by which in reality it abolishes the supplementary special account “Pension Fund LAK”) created by joint agreement between Attica Bank and the Employees’ Association of Attica Bank (SYTA) which was implemented by agreement No. 147 of 5 June 1989 between Attica Bank and an insurance company.
4. 85. According to the complainant, the above legislative acts have created strong upheaval among pensioners. Petitions for annulment and lawsuits were brought jointly by OTOE and the employees’ associations of the various banks to the Court of Cassation and the civil courts (Athens Court of First Instance) respectively: (i) petition by OTOE, the Alpha Bankl Employees Association, the Emporiki Bank Employees Association, and the Attica Bank Employees’ Association before the Court of Cassation; (ii) the lawsuits of Emporiki Bank Employees Association against the Emporiki Bank before the single-member Court of First Instance of Athens on the invalidity of the unilateral termination of the agreement and the transfer of the supplementation pension fund to ETAT and the Special Supplementary Fund for Employees’ Insurance (ETEAM); (iii) lawsuits of the Mutual Assistance Fund of the personnel of the Geniki Bank and the Employees’ Association for the non-insurance of the newly recruited staff in the Mutual Assistance Fund and its transfer to ETEAM; and (iv) OTOE brought the issue to the human rights ombudsperson in a letter Ref. No. 11452/25.2.2007.
5. 86. In a communication dated 3 March 2008, the complainant indicates that the decision No. 116/2008 of the Single-Member Court of First Instance of Athens recognized as invalid the termination by Emporiki Bank on 12 September 2005 of the collective agreement of 25 October 1948 and all amending acts of this agreement between Emporiki Bank and the employees’ union, which concerned the establishment and operation of a Mutual Assistance Fund for Supplementary Pensions. The complainant attaches the decision, adding that it fully justifies OTOE on all issues.
6. 87. In a communication dated 2 November 2007, the Government indicates that respecting its commitments to the ILO, it has already initiated and intends to continue a series of meetings with OTOE representatives and the banks concerned. Following a first meeting on 2 August 2007, a new invitation was made by the Government for a second meeting which took place on 18 October 2007, after the general elections. As in the first meeting, the bank representatives attended the meeting, but stated that they were there only as observers. Nevertheless, they presented the General Secretary of the Ministry of Employment and Social Protection with their views in writing, which he accepted as an indication of participation and presentation of opinions. The representatives of the Government stressed once again the firm decision to continue the series of meetings, even if the employers’ side insists on not participating actively. Hence, the Government awaits the suggestions from the OTOE on the improvement of the institutional framework in the field of the supplementary insurance of bank employees.
7. 88. In a communication dated 19 December 2007, the Government emphasizes that (i) the Government representative has repeatedly attempted to defuse the situation, so that a meaningful dialogue between the two parties can develop; however, the Government has no jurisdiction under the law to oblige employers to participate actively in negotiations, which of course, does not mean that it lacks a regulatory role in such cases, weighing the views of each side and the realities; (ii) the Government never attempted to mislead the ILO by holding perfunctory consultations; on the contrary, it insists on its intention and repeatedly invites employers and workers to submit their proposals; the employers did so in writing during the second meeting; the Government once again stressed during that meeting its position that the contacts must continue even if the employers insist on not actively participating and awaits for the proposals of the OTOE to be submitted; and (iii) the Government never replied negatively to the request made by OTOE that the necessary changes in the existing legislative framework be made; on the contrary, it repeatedly assured the bank employees that it is disposed to proceed to the amendments, which after the negotiations, will be considered to be necessary for the improvement of the existing institutional framework. Concerning this crucial issue, however, the OTOE filed a complaint to the Court of Cassation on 1 November 2007 and the hearing by the plenary of the Court is set for 14 March 2008. The decision is anticipated with great interest by the Greek Government.
8. 89. With regard to its recommendation for the Government to bring the parties to full and frank consultations in order to ensure that the future of the supplementary pension funds of bank employees and of their assets is determined by mutual agreement and to amend Act No. 3371/2005 to reflect the agreement of the parties, the Committee notes that according to the complainant: (i) a second meeting was organized by the Government on 18 October 2007 but the complainant came to the conclusion that the consultations were perfunctory as the Government had taken no measures to ensure that the employers genuinely participate in the process; (ii) instead of implementing the Committee’s recommendations, in 2007 the Government once again proceeded hastily to unacceptable legislative intervention in the supplementary pension funds of the Agricultural Bank of Greece and Attica Bank, despite strong protests; (iii) petitions for annulment and lawsuits were brought jointly by OTOE and the employees’ associations of various banks to the Court of Cassation and the civil courts (Athens Court of First Instance), respectively, where they are pending; (iv) pursuant to one of these lawsuits, the Single-Member Court of First Instance of Athens handed down decision No. 116/2008, which fully justified OTOE on all issues.
9. 90. The Committee notes that the Government stresses once again its firm decision to continue the series of meetings, even if the employers’ side insists on not participating actively and adds that the employers furnished their views in writing, even though they refused to participate in direct dialogue with the union; the Government took this as a form of participation and awaited the written proposals of the complainant OTOE. However, the filing of a complaint to the Court of Cassation on 1 November 2007 appears to have interrupted the negotiations. The Government awaits the decision of the Court of Cassation while the hearing by the plenary of the Court was set for 14 March 2008.
10. 91. The Committee takes note of the decision of the Single-Member Court of First Instance of Athens in the lawsuit filed against Emporiki Bank. It notes, among other things, that the Court found the unilateral denunciation of the collective agreement of 25 October 1948 (as amended on several occasions, most recently in 1996) by which a supplementary pension fund had been established for the employees of the bank, to be invalid because the serious grounds invoked by the bank for the denunciation were found to be unsubstantiated. Moreover, the Court found that the obligatory transfer of assets from the supplementary pension fund to the public funds (ETEAM and ETAT) on the basis of section 26 of Act No. 3455/2006 is contrary to articles 4(1) and (2) and 5(1) of the Constitution, which guarantee economic freedom, including the freedom to conclude contracts freely. The Court also ruled that even though article 22(5) of the Constitution, which provides that the State will oversee the social security of workers according to the laws of the land, gives the legislature the principal role in regulating social security, it does not prevent the conclusion of supplementary (private) insurance agreements between employers and workers, especially when such supplementary schemes provide additional protection and higher pensions. Furthermore, the Court found that the legislative intervention into this matter was not justified by reasons of general public or social interest or the need to protect the economy as a whole, since the issue in question concerns only one specific category of workers and the private interests of particular banks.
11. 92. The Committee requests the Government to indicate the measures taken pursuant to the decision of the Single-Member Court of First Instance of Athens in the lawsuit filed against Emporiki Bank, and to keep it informed of the outcome of the other lawsuits (filed by the Mutual Assistance Fund of the personnel of Geniki Bank and this bank’s Employees’ Association) and to communicate the decision of the Court of Cassation as soon as it is handed down; it also requests to be kept informed of any steps taken by the human rights ombudsperson.
12. 93. The Committee, regretting that the Government took further legislative measures to transfer additional supplementary pension funds – created through collective agreements – to public funds without the agreement of both parties, requests the Government to refrain from any further legislative interference so as to allow for the issue of the future of the supplementary pension funds of bank employees and their assets to be determined by mutual agreement of the parties. It once again invites the Government to host full and frank consultations on this matter with the full participation of both parties, and to amend Act No. 3371/2005 to reflect their eventual agreement.
13. 94. On the issue of section 2, paragraph 3, of Act No. 1876/1990 which prevents, according to the Government, supplementary pension schemes from being the subject of collective bargaining, the Committee notes that according to the abovementioned court decision, the prohibition of regulating through collective agreements issues related to pensions does not apply to the collective contracts reached in this case, which are not typical collective agreements under the scope of Act No. 1902/1990; this is all the more so, according to the Court, in the light of the constitutional provisions which underpin the whole issue. According to the court, the legislature has implicitly confirmed that the parties have the right to conclude collective agreements on this issue by passing into law a 1994 collective agreement between the banks and OTOE, according to which the banks had the obligation to compensate any deficit in the supplementary pension schemes (section 56, Act No. 2224/1994). The Committee takes note of this information. The Committee requests the Government to take all measures, including legislative if necessary, to clarify this issue, so that supplementary pension schemes may be the subject of collective bargaining and brings this aspect of the case to the attention of the Committee of Experts.