No strike: Government gives in to union demands

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A major strike by thousands of public sector workers was averted during the night after Norway’s left-center coalition government caved in to union demands to maintain current pension benefits.

As many as 30,000 state and municipal workers had threatened to refuse to report for work Thursday, if the government persisted in its demands for pension reform.

Instead, Norwegian Broadcasting (NRK) reports that government negotiators agreed to continue its current public pension program indefinitely.

That means workers with 30 years on the job will continue to receive two-thirds of their pay when they retire at age 65. At a time when most private sector workers in Norway are seeing pension benefits cut, both from their own employers and through reform of the Norwegian equivalent of US Social Security, government workers will keep their benefits in return for generally lower pay than in the private sector.

National elections will be held in September, and commentators immediately noted that the Labour Party and its government partners were keen to avoid a strike as the election campaign gets underway.

Negotiations had continued after a midnight strike deadline passed late Wednesday. At that point, it had still appeared that the two sides were far apart and that no settlement was in sight.

The government has been trying to impose pension reform efforts begun in earlier administrations several years ago, claiming that the current system is too expensive. It has wanted to extend the earning period to 38 years and pay higher benefits if workers stay on the job, lower if they retire at 65 or earlier. The official retirement age in Norway is 67.

A major strike loomed last week when the deadline for negotiations ran out with no settlement in sight. Instead, both sides agreed to a highly unusual one-week extension and returned to the bargaining table on Tuesday after the three-day pinse holiday weekend.

A strike would have disrupted everything from day care to schools to the court system, and also would have been embarrassing for a Labour-led government.

Negotiations were continuing over pay issues, but it was the pension reform that was the biggest stumbling block.