Trade-Unions After the Political Changeover in Serbia and Their Role in Transition

May 2001

Six months after the political changeover in Serbia, it is increasingly evident that key changes shall come about with some difficulty and gradually. This is best proved by situation in the trade-union movement, which is one of the prime movers of any transition. Paradoxically enough the broadest strata of population, those who had survived the past decade by moonlighting or engaging in black market activities, shall mount stiffest resistance to changes. Radical political changes have increased expectations, without objective insight into the overall situation. As the government does not seem to be able can persuade citizens of benefits of the market economy, by all appearances it shall be impelled to return to the old, egalitarian model, in order to evade massive strikes and social unrest. Although a vast majority of citizens of Serbia backed replacement of old and installation of new authorities and the reform course, it is obvious that the most important part of electorate, the labour-fit population had hardly any knowledge of the process of reforms. Hence their reluctance to pay the price of transition.

First three months of work of the newly-established government of Serbia (February-April) are a too brief period for sizing up its concrete results, but a long enough period for assessments of intentions and resolve of the government, on the one hand, and of the public responses, on the other hand. According to the official data average net pay in the Republic increased, and it currently stands at DM 130. Inflation in January was 3.2%, February 3.3%, and in March 0.9%, which denotes efforts of the republican authorities to keep inflation in check, at projected, annual 30%. However after announced changes of the fiscal policy, there are doubts that the government shall be able to additionally reduce inflation within the projected growth. The two, most important indicators of standard of living shall primarily depend on revival of production and resolve to government not to bow to pressures to approve unrealistic pay increases. The biggest problem shall however be the surplus of workforce, the inevitable by-product of privatisation. According to estimates of the Economic Science Institute, in the course of 2001 150,000-200,000 workers shall become redundant. At the same time the republican Labour Institute disclosed some negative facts and figures: of 1.9 million officially employed, 400,000-450,000 are on forced leaves, and between 750,000-850,000 people are employed in grey economy. This Institute estimates that of a total number of officially employed people, between 600,000-800,000 represent the surplus workforce.

As even lesser reforms in a society entail certain political consequences it is clear that the overhaul of the whole system is a high-risk political challenge for new Serbian authorities. It is evident that the Serbian government shall firstly face economic-social problems, and secondly problems on psychological plane. Current situation is very unfavourable. It is compounded by intra-DOS rifts and disagreements, unstable political situation in the country and region, ambiguous position on some organisations and foreign institutions, etc. In view of all the aforementioned the desired transition becomes an almost unattainable goal, and announced reforms are from the start weighted down by damaging and dangerous compromises.

Strikes have been continually staged from 5 October 2000, although their number was visibly smaller in the period between republican elections and constituting of government of Serbia. In a large number of cases strikers made demands that the old leadership be replaced. Such strikes were accompanied by various charges of wrongdoing, financial plunder and embezzlement. Although political changes dispelled fear of many citizens, and boosted their motivation to replace the old company leadership steeped in corruption, the newly-elected ruling coalition from its first days in power imposed a strict personnel policy, that is, appointed DOS-party members to top positions. Despite pre-election promises of non-interference in personnel policy and non-budgetary activities, the focus was on gaining major political influence in all companies. While the top political leadership appointed directors of major companies, managers of smaller companies and institutions were appointed by local branches of DOS members after certification by the DOS Presidency, made by 18 leaders of DOS member parties.

In addition to large and damaging political influence of authorities, of some concern is conduct of trade-unions, which frequently render "logistical backing" to parties for promotion of certain personnel choices. Choice of directors in many cases was not a result of professional and expert assessment by certain company bodies, but rather a result of the trade-union lobbying (under political influence of some parties) for certain candidates. Both sides shall be indubitably affected by negative consequences of such human resources policy.

The DOS pretension to control all segments of society is a far cry from principles of liberal economy and creation of a responsible, democratic society. Added to that there is much intra-coalition jockeying for power in many Serbian institutions and companies which is related to conquest of poll positions for some future elections. This strategy is only apparently politically useful: if DOS fails to deliver on promised reforms, the extreme right-wing forces or a new coalition could get the upper hand in the political life. By and large the conclusion is that political future belongs to those who make a visible progress in economic and social field. This aspect makes any lesser political calculation superfluous.

Policy of party loyalists favouritism has already demonstrated its negative effects. Such effects could be lethal in the field of economy, notably in the process of company transformation. In view of a catastrophic economic situation and growing social tensions in the society, it is justifiable to pose the question how shall inexpert personnel, moreover unsupported by employees, cope with serious and delicate problems? It is indicative that the government and some of its competent ministries have not yet appointed top management in the judiciary, police, health, education, etc. As those are areas of major importance for population at large and functioning of the state, excessive calculating and party competing, along with disregard for stances of employees, led to discontent of employees in this state-funded institutions and citizenry at large.

On the other hand change of the regime brought about re-shuffle of the trade-union scene, but a rather negative one. Independent Trade-Union of Serbia, the most numerous and the strongest trade union, once under indirect control of Miloševic regime, just shifted its loyalty towards the new authorities. But as large part of its membership still adhere to former ideology, discord is rife within association. As changes were only of cosmetic nature, activities and intentions of this trade union are under suspicion. The principled struggle for protection of rights of its membership is overshadowed by internal strife and weighted down by negative legacy of this oldest association.

Large part of so-called "independent" or non-governmental " trade unions is trying to build their identity. After the victory of political option longed back by most of them, those trade-unions lost the necessary distance, and became dependant on the new authorities. But from a bevy of "independent" trade-unions, we can single out Trade Union "Nezavisnost," Association of Free and Independent Trade Unions (AFITU), and Union of Trade-Unions of Educational Workers of Yugoslavia. Namely they have a solid organisational structure and large memberships. In contrast to officials of "Nezavisnost" who backed political changes but in a cautious way and with some reservations, AFITU, was a member of DOS from its inception, and former president of the trade union is the incumbent Minister for Labour, War Veterans and Social Affairs. In actual fact the latter gained prominence, in parallel with the election-boosted rating of some parties, members of DOS. Judging by its registration problems and criticism levelled at it for spearheading some strikes, "Nezavisnost" is not popular among the political establishment.

Global problem of this and many other trade-unions are undertrained activists, who cannot properly articulate trade-unions demands and conduct the struggle for set objectives, but are graft-prone and also inclined towards striking shady political deals. This is particularly visible in small towns, namely trade-union fractions have the same goals, but different attack towards their achievement. General confusion in the trade-union scene is compounded by emergence of new trade-unions and associations. As there are no precise and validated facts and figures on memberships of some trade-unions, room for manipulation is large, and this fact is exploited by trade-unions, employers and the state.

Decade-long collapse of economy, isolation of the country and all-level criminalisation of the country, created an unlawful milieu tolerant of socially and legally proscribed conduct. Across-the-board pauperisation led to adoption of totally distorted set of values and high-level corruption. Citizens, who used to fend for themselves in the past decade, lost labour discipline and law-abiding habits. Lack of understanding for contemporary world, the European and international trends is rampant, and compounded by the communist era legacy, or 50 years of existence out of sync with the then international trends. Hence any reform intending to bring Serbia closer to the world shall be resisted by broad strata of population either because of misunderstanding or fear of consequences of fundamental changes. Citizens of Serbia are slow to embrace changes and face reality, and that is the backdrop against which numerous strikes and social protests are likely to be played out.

Most citizens earn very little, which in itself is a good enough motive for their discontent, manifested almost every day in companies across Serbia. But even a cursory analysis of conduct of trade-unions and citizens indicates two facts: first, the strikers' demands are most frequently unrealistic, and secondly, nobody wants to face the reality and accordingly make demands. Unrealistically defined demands undoubtedly stem from mental and physical fatigue, but also from unrealistic expectations. Namely in the wake of major political changeover many citizens hoped for instant progress and immediate rise in living standards. In fact they declined to see the reality.

Added to the aforementioned trade-unions proved to be incompetent negotiators. This became particularly manifest during February and March massive protests of the three educational professionals trade-unions. Bolstered by their long-standing experience in strike-management, two "independent" trade unions and the Free Trade-Union began negotiations with the Serbian government with the old arguments and communication patterns. After long negotiations trade-unions had to accept a compromise solution, mostly because their prolonged strike turned the public opinion against them. Negotiators of the Serbian government were more deft and sly than rigid and much-disliked Miloševic's ministers. Added to that trade-unions disregarded the fact that the new authorities still enjoy high ratings and popular backing, both among population at large and the media.

Lack of solidarity is one of the features of current activities of trade-unions. Stern warnings and much-announced blockade of the republican parliament by the trade-union "Nezavisnost", provoked by the government's refusal to consult trade-unions on budgetary issues and package of fiscal laws, ended with a protest walk of several hundred activists in Belgrade and a larger rally in Niš. Several days later the Free Trade-Union threatened to stage a general strike, but the effect of threat was negligible.

Deep rifts and differences between trade unions emerged in discussions on announced repeal of the Act on Property Transformation. Namely the Serbian government made it public that the new Act shall include many amendments, and that employees shall be offered only 10% of stocks of companies undergoing privatisation. The latter provision met with negative reaction of the Free Trade-Union, which in turn, was criticised by other trade-unions and experts. It bears stressing that the Free Trade-Union is blamed for acting as a stooge of former regime. Moreover it is maintained that its close ties with the regime facilitated the latter to amply engage in crony privatisation and economic plunder.

Trade-unions have been discussing and responding to announced taxation of gross pays, introduction of "income brackets" (as an interim solution in the process of fine-tuning salaries according to educational level and work position), pay freeze in state bodies and public companies, state control over export of certain commodities. However the biggest challenge both for the government and employees shall be the process of privatisation.

Fear of job loss a priori is a big hurdle for a vast majority of employees to rationally see their future and benefits from this inevitable process. Lack of initiative and impossibility to adjust to new circumstances of employees could block the reform process from its very outset. Principles of market economy, unbridled competition and personal responsibility, are unacceptable for most workers. This became manifest during many strikes, notably during the April protest of several thousand workers of car plant "Zastava." Namely "Zastava" workers not only demanded to be paid their overdue salaries which they have not in actual fact earned, full-employment kick-start of the industrial production (full-employment ceased to exist in 1991!), but also stiffly opposed the government's intention to separate and make independent profitable parts of this bankrupt industrial giant, and any axing of jobs in case of foreign investments. Although an interim, compromise solution was found, and strikes were suspended for the next two months, it is clear that the government's reform or overhaul plan shall meet with the stiff resistance of workers of "Zastava" and other similar companies. Insistence on monopolistic, protected position, shall be also an obstacle to liberalisation of economy.

Although Serbia has only began the transition process, problems which political leadership and entire population face are serious and difficult, but they exact urgent tackling and many useful, albeit compromise solutions. Serbia's crisis is long-standing and deep, and it requires immediate kick-start of reform process, which must be preceded by a general social consensus. But absence of such consensus has became very manifest.

In the face of threatening social tensions, the Serbian Prime Minister was compelled to ask the strongest trade-unions (Free Trade Union, "Nezavisnost" and "AFITU") to jointly work on "social compact" between the government, trade-unions and employers. On the 21st April, the social dialogue began and concrete forms of co-operation were agreed. . Namely the government and trade-unions shall jointly elaborate programs and laws related to workers, peasants and retirees. If agreed mechanisms of co-operation start functioning, potential for social tensions and conflicts could be lessened or at least transferred to negotiating table. In that case trade-unions shall assume concrete responsibility which belongs to them and which they have declaratively demanded.

Are the government, trade-unions and employers ready to carry out the burden of reforms, remains to be seen. But success of the reforms depends primarily on citizens. Results of a survey conducted in mid-March speak of diminishing hopes and patience of citizens, and their increasing fear of the future.

Citizens of Serbia are yet to face their major test.

HCHRS