Estonia, Labour Unions, Markets and Companies

The aim is that wage and working time conditions can be extended to the whole sector only if agreed by employers who offer work to at least one-fifth of the sector's workers.

According to the draft, trade unions and employers' associations or unions, whose members offer jobs to at least 20 percent of employees in the field, can further agree on the extension of wage and working time conditions. Before concluding an agreement, there is an obligation to publicly inform and involve all employees and employers to whom the conditions are to be extended.

The reason for amending the law is the decision of the Supreme Court of June 15, which gave an interpretation that a collective agreement cannot be extended without the consent of all employers. The purpose of the draft is to alleviate the bottlenecks identified by the Supreme Court and again to enable the extension of collective agreements.

"Of course, the protection of workers must be ensured, in which collective agreements play an increasing role. At the same time, it is important that an agreement to extend the agreement is reached with employers who employ a significant part of the sector. It is important that all employees and employers who may be affected by the change be publicly informed of the intention to extend the collective agreement and of the negotiations," Minister of Social Affairs Tanel Kiik said.

Under the current law, employers and employees' representative organizations can extend the terms of wages and working hours concluded between them to all other employers and employees who are not otherwise parties to the collective agreement. In practice, however, this poses problems, as it is possible that a small number of workers and employers will agree on rules that will apply to everyone else. In the opinion of the justice chancellor and the Supreme Court, this is not in accordance with the principle of freedom of enterprise, as companies have to meet conditions that they have not agreed upon themselves.

In Estonia, the extension of the collective agreement is in use in the medical and transport sectors. The Estonian Employers' Confederation and the Estonian Trade Union Confederation also agree annually on a minimum wage, which is extended to all Estonian employees.

The bill also increases the protection of employees' representatives and increases the compensation for unlawful termination in cases where the employment contract is terminated either with a pregnant employee, employee with pregnancy or maternity leave right or with an employee serving as representative of other employees.

The bill amends the Trade Unions Act and the Employees' Trustee Act and obliges an employer whose company has several trustees to give free time to all trustees. In addition, the Employment Contracts Act will be amended and the rate of compensation will be increased if it is established that the termination of the employment contract with a pregnant employee, employee entitled to pregnancy or maternity leave or an employee serving as representative of other employees was illegal. The benefit will be increased from six months to 12 months.

The bill can be viewed in the Draft Information System (EIS) and feedback can be given until November 2.