Unions warn of new labour ‘underclass’

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As Norway’s unemployment rate rises, labour union leaders are warning that the arrival of thousands of refugees who also need jobs can create a new “underclass” in the Norwegian workforce. They worry employers will exploit a sudden supply of potentially cheap labour, but the unions themselves have a long way to go in appealing to foreign workers in Norway, and integrating them into the Norwegian labour movement.

Gerd Kristiansen, leader of trade union federation LO, is among those fearing the rise of an "underclass" in the Norwegian labour market, and she opposes any introduction of a miniumum wage. PHOTO: Arbeiderpartiet

Gerd Kristiansen, leader of trade union federation LO, is among those fearing the rise of an “underclass” in the Norwegian labour market, made up of immigrants and asylum seekers. The labour movement itself, however, often has a hard time appealing to newcomers in Norway, because of confusing regulations and terminology. PHOTO: Arbeiderpartiet

A recent study by labour research organization Fafo found that the labour movement has a hard time recruiting immigrants. Norwegians grow up in a system unfamiliar to most foreigners, where not only rank and file workers but also professionals are widely represented by labour organizations. That has nurtured the so-called “Norwegian model” in which entire sectors negotiate pay and benefits, not necessarily individual companies. In the hotel sector, for example, organizations representing hotel employers will bargain with unions representing hotel workers, and government authorities are always standing by in the background. In the case of a strike, the unions select which workers at which hotels are taken out and put on the picket line. It’s all rooted in a system of unusually civil cooperation involving third parties and both the private and public sectors.

Now tens of thousands of people unfamiliar with this system will be competing with Norwegians for all kinds of jobs, and few of them are likely to be members of unions. The Fafo study found that 15 percent of the Norwegian workforce is already comprised of immigrants but the labour movement remains almost entirely ethnic Norwegian.

Put off by ‘tribal language expressions’
“We know that some immigrants do become members of unions, but they seldom are elected as employee representatives (tillitsvalgte),” Inger Marie Hagen of Fafo told newspaper Dagsavisen last month. Immigrants also rarely advance into the union hierarchy, much less at the labour federation level. Fafo found two clear indications for the lack of immigrants active in the Norwegian labour movement: language barriers and a lack of knowledge about the “Norwegian model.” Even immigrants with a good grasp of written and spoken Norwegian can be bewildered by all the “tribal language and expressions,” as Fafo put it, that are used within the labour movement and its tariff-system terminology.

Norwegians themselves can also be confused by the terms bandied about in the labour movement, while the jargon can utterly baffle newcomers. That’s why new immigrants, especially asylum seekers, may be unlikely to join unions, and accept pay that would be considered low by union standards. That in turn raises the concerns of employer exploitation.

Minimum wage proposal meets opposition
A new proposal by three employer organizations (NHO, Virke and Spekter) to explore the possibility of establishing a minimum wage in Norway has also alarmed the labour movement. The employers think a minimum wage could ward off development of a “grey or black” market among employers “who aren’t so concerned about labour agreements and legalities,” Anne-Karin Bratten of Spekter told Norwegian Broadcasting (NRK) on Wednesday. She said a minimum wage could be an effective tool in hindering labour market exploitation, and she has support from Virke, which represents many employers in the travel and retailing business.

The labour organzations contend a minimum wage will usher in even lower pay offers in already-low paid sectors. They don’t want to institutionalize a relatively low rate of pay, as is common in other countries like the US. Gerd Kristiansen, leader of Norway’s largest trade union federation LO, flatly rejects a minimum wage, claiming it will “put downward pressure on the groups that already earn the least. That means that in the long term, we will get an underclass in the Norwegian workforce.”

On Thursday came news that the Parliament is unlikely to take up the issue of a minimum wage in Norway, with politicians on both the left and right arguing that it would not work given the “Norwegian model” of labour negotiations.

‘C’ and ‘D’ teams
Labour Party leader Jonas Gahr Støre shares Kristiansen’s concerns about the potential for an emerging “underclass” in Norway. He recently warned, along with LO, of the creation of not just “A” and “B” teams in the work force but also “C” and “D” teams. Newspaper Aftenposten reported that at a recent conference in Gol, Støre and Labour’s party secretary Kjersti Stenseng expressed concern that the refugee influx can threaten the model that relies on cooperation among government authorities, employers and labour unions.

Meanwhile, in a country where there already are hundreds of applicants for jobs as grocery store clerks, rising unemployment will only make the job market tougher. Some economists warned this week that Norway’s unemployment rate, now officially at 4.6 percent, may surpass the rates in Germany and the US for the first time in years. Figures released this week also showed that around 127,000 people are now registered as fully without work in Norway, the highest level in more than 20 years. With oil prices low, the prospects for economic growth are weak.

newsinenglish.no/Nina Berglund