Down but not out: Union strategies and power resources in response to liberalization and changes in national postal services – The cases of Spain and Belgium

Socio-economic and institutional context

The Sociedad Estatal Correos y Telégrafos (Correos), created in 1716, is the oldest public company in Spain. With more than 50,000 employees, it is currently one of the largest companies in the country. After successive transformations of its legal status, it adopted the corporate form of a 100 percent state-owned limited liability company in 2001. This means that Correos must operate under the same conditions as private companies in the sector but, at the same time, that all its decisions are subject to government priorities, guidelines and regulations.

Ever since the process of liberalization of the postal market begun, the stance of the various governments towards Correos has ranged from apathy towards the company’s future to a failure to fully comprehend its specific situation. This lack of government support, lasting almost two decades, largely explains the inability of Correos to adapt to changes in the postal market. Its current market position is very fragile due to its lack of internationalization and its high dependence on letter delivery in a context of drastic and steady decline of this activity (European Commission, 2018). Generally, the financial results of Correos have been negative in recent years. This situation has led the company to seek viability by trying to position itself in the parcel delivery segment – in a rather feeble and poorly planned way, according to the unions – and, above all, by reducing labour costs: downsizing and cutting wages and labour rights. To this end, the company has adopted an aggressive human resources policy that has not only had repercussions on employment and working conditions but has also ended up straining labour relations. As a result of this downsizing strategy, the workforce has decreased and the quality of employment worsened considerably. Management justifies changes with the need to compete in the parcel delivery segment: ‘the change in going beyond the letter forces you to make adjustments [. . .] the aim is to adjust employment to the reality we need’ (HR Department Manager). Based on this argument, Correos is resorting to flexible working models, particularly part-time employment.

The employment status of postal employees and the activity of trade unions are covered by regular labour legislation. Workers are represented by a unitary body, the Bargaining Committee, made up of a total of 12 representatives, who are allocated according to the degree of representativeness among the unions that attain at least 10 percent of the votes cast. This unitary representative body is of great importance in the functioning of labour relations at Correos: the trade union organizations that make up this body are granted recognition as interlocutors by the company for purposes of collective bargaining. Collective bargaining plays a central role as a mechanism through which unions are able not only to negotiate working conditions and employment management by the company but also, and above all, to monitor compliance with the agreed upon terms and conditions. There are no other institutionalized channels for social dialogue; any other types of negotiations or agreements are the result of the pressure exerted by trade unions.

Union strategies of conflict and negotiation

Trade union organizations have a high degree of implantation in Correos. This strong presence translates into a very high rate of union affiliation (around 75 percent, compared with a national average of 17 percent) and a generally positive and massive response of workers to their calls for union mobilization. These are factors which give unions a significant leverage potential. The four ‘most representative’ unions at the national level in Correos are the following: Comisiones Obreras (CCOO), Unión General de Trabajadores (UGT), Central Sindical Independiente y de Funcionarios (CSIF) and Sindicato Libre (SL). CCOO is the union with the highest degree of representation (40.2 percent), and, together with UGT (19 percent), they represent almost 60 percent.

All the trade unions agree that Correos’ future viability depends, first and foremost, on the Government’s willingness and commitment. The strict subordination of the company to the political and budgetary priorities of the government of turn makes political decision-makers the preferential interlocutors of the unions and leads these organizations to take action in the political sphere to achieve their goal. Therefore, trade union strategies in this field aim, first and foremost, ‘to put the postal operator on the Government’s agenda’ (CCOO, 2017). Aside from exposing the government’s neglect of Correos, so far, unions’ intense activity of dialogue and political pressure has yielded few relevant results. Only recently, with the arrival of the Socialist Party to office in 2018, has a more favourable ‘political contingency’ (Batstone et al., 1990: 24) emerged in the process of political exchange (Pizzorno, 1991) between the government and the unions, increasing the capacity of the latter to exert pressure.

In any case, for the unions, the results obtained through social dialogue and political pressure do not make sense in and of themselves; they are merely the necessary conditions for the achievement of their main goal, the improvement of working and, above all, employment conditions for postal employees through the signing of good collective agreements (Responsible of Union Action CCOO). Since the total liberalization of the sector, unions have had difficulties in securing negotiations and signing collective agreements. It could be argued that the company has carried out a deliberate policy of blocking the collective bargaining process. Correos has reached three collective agreements since it became a public limited company in 2001. The third one was signed in 2011. It formally expired in 2013, but it is still in force today because the company is reluctant to unblock the negotiation process. In accordance with Spanish labour legislation, if a collective agreement signed before 2012 included the ultra-activity clause, it would remain valid indefinitely until a next agreement is signed. This is causing serious problems for the unions since, due to the rapid changes in postal activity, the content of the current agreement regarding working hours and contract modalities has become obsolete. The company is profiting from this situation to make employment and working hours more flexible by a fait accompli approach. For example, it is using part-time and shift work that is not included in the Third Agreement and has not been negotiated with the unions:

. . . it can’t be like the company is doing now, because it is not sufficiently tied up in the Collective Bargaining Agreement, it does it as it pleases, through the back way, a little bit like this now and another little bit like that and in the end you find that there are certain shifts in place [. . .] ‘Can you explain to me where this came from? Because you were supposed to run them through the Negotiating Committee, but we didn’t even see this’ ‘Man, of course, but if we don’t want to lose customers . . .’ (Responsible of Union Action CCOO)

As a result, the mobilizations that have taken place over the last 10 years have focused mainly on forcing the negotiation process to begin or on pressing for it to be unblocked. Although unions prioritize negotiation over conflict, they by no means exclude it. The strategic option of the unions in this domain is what they call the ‘pressure-negotiation binomial’ in which, as they emphasize, ‘neither mobilization nor strike are considered ends in themselves, but rather the gathering of the necessary strength to face negotiations and agreements in better conditions (CCOO, 2017). A fundamental component of this strategy is the unity of action of the main union forces, a unity that has been respected and practised since 2010 in all relevant conflicts.

Since the complete liberalization of the postal market in 2010, the unions have organized four national-level strikes in 2011, 2014, 2015 and 2018, preceded by partial strikes and demonstrations at the local level that lasted several months. A detailed analysis of the evolution of these protests shows that, just like in political exchange actions, trade union conflict strategies in this area have had limited success, at least in the short term. The strike in 2011 served to unblock corporate resistance to the signing of the Third Collective Bargaining Agreement – finally signed in April of the same year – but did not succeed in modifying the contents of the Postal Law that liberalized the sector that year. Whereas the mobilizations of 2014 contributed to maintaining the ultra-activity of the III Collective Agreement despite the company intention to terminate it (the issue was only closed via an appeal to the High Court), they did not manage to reopen the negotiations of the IV Collective Agreement. In fact, as we have pointed out, despite three national-level strikes, the negotiation process of the IV Agreement remains open to this day with no precise estimate of when an agreement between the parties may be reached. Finally, after the 2018 mobilizations, unions managed to close the ‘Pluriannual’ Agreement that includes improvements in some of the issues that usually form part of the regulatory content of collective agreements in Spain (wage increases, an increase and stabilization of employment, and the re-instatement of some rights). However, we should not overlook the fact that it is an agreement of limited scope (it does not include all the contents, nor does it have the rank of Law of Collective Bargaining Agreements).

However, if instead of evaluating the short-term success of the unions’ strategies we adopt, as Molina and Barranco (2016) propose, a long-term approach based on the interaction between these strategies and the mobilization of union power resources, the outcome can be evaluated differently. From this perspective, the mobilizations called for by trade unions should not be considered solely as actions aimed at revoking or forcing a particular decision made by the enterprise (or government), and also – and above all – as elements of a broader trade union strategy aimed at building and mobilizing its power resources in the interest of achieving its long-term objectives.

Thus, first, the national-level strikes and the strategy of unity of action have served as mechanisms to strengthen the main power resource at the disposal of the postal unions, their extraordinary capacity for mobilization (organizational power). All strikes are preceded by assemblies in the workplaces to explain the issues to workers and invite their participation in the demonstrations and strikes. In doing so, unions have not only sought to obtain – and have succeeded in securing – the massive support of workers in each of the mobilizations they have called for, but they have also conveyed their vision of the challenges faced and proposed solutions (framing) with the aim of obtaining long-term worker involvement. Second, trade unions have made use of mobilizations to raise social awareness of the repercussions of the political abandonment of Correos and thus gain public understanding and support. To this end, they mobilize their discursive power by framing the conflicts as defensive actions against the erosion of the quality and coverage of public services rather than as mechanisms to preserve workers’ labour interests. The combined effect of the mobilization of these two resources – the organizational and the discursive power – strengthens the unions’ negotiating position in the political exchange, that is, their political power.

Socio-economic and institutional context

The Belgian post became a state service in 1830, changing its legal status to an autonomous public enterprise in 1991 and then transforming into a public limited liability company in 2000. As is the case with Correos in Spain, bpost is among the five largest employers in Belgium, totalling more than 34,000 employees. However, its position with regard to the state differs from the Spanish case, as bpost maintains a high degree of management autonomy. This does not mean that the state, which remains the majority shareholder with 50.1 percent of the capital, does not intervene in strategic decision-making. On the contrary, it has been supporting the process of ‘modernisation’, aimed not only at adapting the company to changing market conditions, but also at transforming it into a leading postal operator.

The modernization process, initiated at the turn of the year 2000, coincided with the onset of the liberalization process of the postal sector in Europe. The company signed a strategic industrial plan coupled with the signing of a social agreement with trade unions for the period 2001–2004. At that stage, trade unions still managed to make the social management of ‘modernization’ prevail. However, the situation changed from 2004 onwards. First, the company’s financial and economic situation was deteriorating, primarily due to the decrease in mail volume; and second, the political authorities became increasingly inclined to safeguard market forces and private sector management practices, thus withdrawing their essential support of trade unions. The change was substantial for unions:

It is true that things have changed [. . .] all those years back, we were negotiating directly with the ministers [. . .] I would say that today we are dealing with a company, it is the boss, what, it is really a business owner, it is no longer a director. (CGSP General Secretary)

From that point on, the general context became increasingly unfavourable for trade unions, now unable to make their own solutions prevail, while management became increasingly uncompromising in bringing forth what they deemed to be necessary changes.

The bpost has now evolved into a diversified postal group, in terms of both activities and internationalization, and as a result became profitable once again after a loss-making period in the early 2000s. However, despite positive commercial results, bpost’s employment volume steadily decreased from 2005 onwards.

Unlike at Correos, labour relations at bpost are governed by a company-specific arrangement – the Trade Union Statute – and maintain the characteristics of a co-management logic. The main negotiating body, the central joint committee, is composed of 18 members: the management and the trade unions have nine votes each. Relations between company and unions show a high degree of formalization. In addition to the central joint committee, there are several joint sub-committees and consultation committees. All these committees fit into each other like Russian dolls. Moreover, there are more informal channels of dialogue, consisting of monthly meetings between the company and trade union representatives, in which management presents its initiatives for preliminary discussions before they are officially submitted. Collective bargaining, systematically undertaken every 2 years, is exclusively reserved for joint committees at national level, and usually leads to the signing of Collective Labour Agreements (usually valid for 2 years) or framework agreements. Other corporate agreements that are subject to unscheduled negotiation are contingent on, and result from, overt conflict, in response to managerial restructuring, organizational changes and strategic plans.

Union strategies of conflict and negotiation

Union membership rates at bpost are particularly high, ranging from 70 to 80 percent, in comparison with a national unionization rate of about 55 percent. This high level of union membership, together with a strong trade union network in the workplace and a high level of legitimacy that postal workers and management give to trade unions, bears witness to a great mobilization potential and a strong institutionalization of labour relations. Three trade union organizations are present in the joint national committee of bpost: Centrale Générale des Services Publics (CGSP), CSC Transcom (CSC) and Syndicat Libre de la Fonction Publique (SLFP), all three belonging to their corresponding trade union confederations. Although CSC has always been one of the unions calling for mobilization, it has never been a signatory of the agreements reached to resolve these conflicts. In contrast, the CGSP and the SLFP are more inclined to accept compromises in the name of job maintenance. Union unity is seldom found at bpost.

None of the trade union organizations questions the need for modernization of the company; however, as it threatens employment in terms of quantity and quality, it has resulted in a high level of conflict over the last two decades, with strikes reaching their peak during major restructuring processes. There have been three major periods of conflict since the complete liberalization of the postal market: in 2010, in 2015 and, more recently, in 2018. The analysis of these conflicts and ensuing agreements allows us to assess the unions’ positions and their degree of success in moderating management’s proposals.

The first period of conflict started with the company’s proposal to create a new category of employee: the so-called ‘neighbourhood postal workers’, on a part-time basis, minimum wage salaries and whose job function would be exclusively the delivery of mail. When presenting the plan, management declared that it intended to force it through, on the ground that ‘it’s that or bankruptcy’. This management project became a major source of conflict and generated substantial negotiations that concluded in 2010 with the signing of a collective agreement regarding the re-organization of mail distribution. Neighbourhood postal workers ended up being ‘auxiliary postal workers’, a one-tier employment status with no increase in earnings for seniority. The agreement also stipulated the preferential use of full-time employment over part-time employment and an increase in the basic hourly wage originally proposed. Thus, the agreement served to soften the blow, not to eliminate it altogether. Even unions tended to downplay the extent of this ‘victory’. Of the negotiating unions, CSC did not subscribe to it. For this union, ‘it was a Pyrrhic victory, because what followed was the famous DA, an auxiliary postal worker, low-cost positions for some’ (CSC Federal Secretary).

In 2015, the proposition of the MSO work organization plan strained social relations significantly. For the management, the aims of this plan were to make the organization of bpost more ‘agile’, that is, flexible, in order to cope with the fall in traditional mail volume and the strong fluctuations in the volume of parcel flows. It was depicted as a ‘catalogue of horrors’ by the CGSP, while the SLFP saw it as ‘unbearable stuff’. Among its most drastic measures, the plan intended to equate work on Saturdays with work during weekdays. Eventually a social agreement was reached, once again with the disengagement of CSC. Finally, the conflict in 2018 was, in many respects, unprecedented in the scale and offensive nature of the strike. The union-led conflict consisted of a 5-day rotating strike, successively covering all sectors of the company, with nearly 90 percent% of postal workers following the strike, according to union sources. Again, the negotiations resulted in a collective agreement – not signed by CSC – which served to tone-down the management’s proposals.

In general, the analysed union responses to management projects reveal a disposition to what could be described as a unionism that moves between strategies of conflict and support of the modernization process. The company’s transformation is based on an intensive social dialogue that combines formal procedures with more informal practices, overlapping with periods of conflict that usually result in the signing of collective agreements. The institutional framework, which reflects historical dynamics of co-management, has favoured the development of trust-based relationships and a set of shared understandings (Hall and Soskice, 2001) between management and unions. There is a well-established culture of social dialogue that does not exclude conflict, but which aims to reach agreements by both parties.

This context of common expectations does not exclude the fact that management negotiates from a position of superiority, determines the content of negotiations and establishes timing and pace. These requirements often surpass what appear to be breaking points for unions; therefore, negotiations are difficult and, at times, very difficult. The unions’ position is largely defensive. Their aims are to limit, wherever possible, the impact of managerial decisions that affect working conditions and wages while striving to maintain employment levels. This often involves substantial concessions and compromises. Unions insist on the need to modify the employers’ projects through negotiation:

I take the MSO plan for example, on which we worked for more than a year . . . The CSC did not sign, and it caused a ruckus, but we introduced many things for the workers, especially for the DA’s who had no right to job mobility, security of employment . . . They [the management] know very well that we take our responsibilities seriously and that if we decide to get involved in a matter, we will go all the way. (CGSP, General Secretary)

In these processes, the strength of the union’s responses and the responses of the workers are decisive. Therefore, as is the case in Spain, the main power resource bpost unions turn to is their mobilization capacity. However, weakened they may be, unions and workers have proven their ability to bring bpost activity to a grinding halt in recent years. But, in contrast to what occurs in Correos, this resource is mobilized on the basis of a strong institutionalization of collective labour relations. The combination of both power resources would account for the fact that, although weakened by free-market logic and the intensification of reforms, the unions remain an important or even unavoidable player. To date, this implies that attempting to weaken or undermine trade unions is likely to compromise future projects for the company.