Social unrest looms as wage agreement appears impossible

Social turmoil seems on the horizon as talks between unions and employers on wages appear to have reached an impasse before they even started. The socialist trade union warns, one day before the start of the talks, that it will not sign an agreement which mentions a 0 per cent wage increase.

Starting tomorrow, unions and employers will convene again to discuss wages and working conditions for the next two years. The biennial consultation has never been known to go smoothly, but the water between the social partners seems very deep this time.

This extra difficulty is due to historically high inflation and the Belgian system of automatic wage indexation - by Belgian law, salaries are indexed automatically to adjust for the increased cost of living. As a result, companies see the so-called 'wage cost handicap' rising compared to neighbouring countries. The current wage standard law says that when this is the case, wages cannot rise. The trade unions, however, have dubbed this arrangement a 'sham law' and insist that wages can increase, especially in sectors that are doing well.

The starting point of the wage talks is the so-called wage increase margin determined by the Central Business Council (CRB). The wage increase margin determines the maximum increase in salary costs over a two-year period based on the rise in salary costs in Germany, France and the Netherlands. Limiting the growth of salary costs is meant to ensure that the Belgian economy does not suffer a competitive disadvantage vis-à-vis its neighbours.

The CRB will officially hand over its report to unions and employers tomorrow. However, it is already clear that according to current calculations, the wage margin will be 0 per cent.

Tomorrow, the social partners will meet for the first time within the Group of Ten, the top consultative body of unions and employers. But socialist trade union FGTB made it clear today that it will not sign an interprofessional agreement that mentions a 0 per cent wage increase margin. "There is a good chance the government will have to decide," said Miranda Ulens, general secretary of the socialist union.

(BRV)

^{ABVV/FGTB socialist union general secretary Miranda Ulens delivers a speech at a national demonstration of socialist, christian and liberal unions in Brussels earlier this year © BELGA PHOTO JONAS ROOSENS}