Sweden pushes to protect collective agreements

(AFP)Sweden's government wants to make it illegal to hand out public contracts to companies that have not signed collective agreements, amid fears of an influx of cheaper labour from other EU countries, an official said on Thursday.

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"We (in Sweden) have a different tradition than what is usual further south in Europe ... It is extremely important that we show that we can enforce the collective agreement in Sweden also in the future," Swedish Minister for Local Government and Financial Markets Sven-Erik Österberg told Swedish public radio.

His comments follow a more than three-month-long union blockade of a Latvian construction company that had refused to sign a Swedish collective agreement.

Swedish unions accused the Latvian company Laval un Partneri Ltd of paying its workers far lower wages than permissible in Sweden and blockaded its building sites in the Scandinavian country starting last November in an attempt to pressure the company into signing a Swedish collective agreement.

In February, the company abandoned one of its building sites, a public school in Vaxholm, near Stockholm, and earlier this week Laval subsidiary L and P Baltic Bygg, which had been working on that project, filed for bankruptcy.

"In light of among other things what happened in Vaxholm, this (issue) has become very pressing," Österberg said.

The rift between the Latvian company and the local unions has been followed closely in Sweden, where it was seen as a direct consequence of European Union enlargement and amid fears of an influx of cheaper labor from eastern European countries, including Latvia, that joined the bloc last May.

If the government gets its way, companies like Laval that refuse to sign collective agreements will not even get to bid for public and state contracts, public radio news program Ekot reported.

But it may not be clear sailing getting the rule passed, since it could clash with existing European legislation.

"If (we) run into problems we will of course have to get involved in pushing the question in the EU and say that we will not accept that we can not make this (rule) work in Sweden," Österberg said.