Weakening democracy at work fuels inequality in Europe

New research indicates that the weakening of collective bargaining is a key driver behind increasing income inequality in Europe. Collective bargaining is the main vehicle for workers to claim higher salaries. As such, policies that have weakened collective bargaining have overwhelmingly resulted in income being diverted away from working people and towards the top 10% highest incomes instead.

In a report entitled The planned obsolescence of Social Europe, the levels of inequality and collective bargaining are compared for all EU countries as well as the UK and Norway.

“This report shows that inequality is a deliberate policy choice. When policy-makers exclude working people from having a say at work, they are taking aim at shared prosperity. The tools for workers to claim a fair share of the wealth they create are dismantled. This money is redistributed upwards to be captured by shareholders instead,” explained Oliver Roethig, Regional Secretary of UNI Europa.

Policies that restrain people’s capacity to bargain collectively have proliferated in countries where inequality rates have grown most. This is the case in Bulgaria, Cyprus, Czechia, Germany after 1990, Greece after 2008, Hungary, Ireland, Malta, Poland and the UK.

Meanwhile, countries that have maintained collective bargaining coverage at a high level, have kept inequality at bay too. Examples are Austria, Belgium, Denmark, Netherlands, Sweden.

“This is a question of defending democracy. People will lose trust in a system that is rigged to favour the rich. The essence of democracy is not just the freedom to speak—it is the right to have a say. This principle must be embedded at every level of decision-making. Democracy is not just voting every few years but it is also people having a say over decisions that shape their everyday working lives,” said Oliver Roethig.

Read the report: The planned obsolescence of Social Europe