Talks between the Norwegian Confederation of Trade Unions (LO) and the Confederation of Norwegian Enterprise (NHO) over the annual wage settlement ended last week without an agreement being struck.
“It wasn’t possible to make any progress in the negotiations”, Peggy Hessen Følsvik, leader of LO, said of the breakdown.
With talks breaking down, the two parties will enter mediation with the state mediator.
Over the past eight years, wage growth has only been marginally higher than inflation. This year, LO has committed to ensuring workers get a wage rise that outpaces inflation.
According to a government estimate, inflation is forecast to be 4.9 percent in Norway in 2023. This means LO is after a wage rise in the region of five percent.
LO has argued that high wage rises for managers and executives and large profit margins for firms mean that businesses can afford the requested increases.
Meanwhile, employers say that using inflation as a basis for wage negotiations isn’t suitable, as it doesn’t offer an indicator of firms’ profitability for 2023.
Mediation talks will begin on April 14th, with a deadline of April 15th. The deadline can be extended at the will of both parties. However, LO has said it is willing to call strikes from the 16th.
How likely is a strike?
Essentially, a strike is entirely possible if the two parties fail to agree to a deal during mediation. Both parties have held their cards quite close to their chest, so how far apart they are is unclear.
This year’s negotiations are for an interim settlement.
The industries and sectors that could strike will be announced before the mediation talks. When the sectors or workers who may strike are revealed, a rough idea of how disruptive the industrial action will begin to form.
If the proposed strikes threaten mass disruption, then the bargaining position of LO will be stronger in mediation. LO can take out around 185,000 workers on strike if it wishes to do so.
Should the two parties in Norway be close to an agreement, they may find a solution in mediation or choose to extend the deadline to push through a deal.
Strikes in Norway are pretty common. Over the past year, workers in the aviation, oil and gas, the private kindergarten sector, and teachers have all gone on strike.
Furthermore, they tend to strike in waves – meaning that the strike will gradually be ramped up rather than have all the workers taken out at once.
Norway’s government can choose to end strikes and force two parties to mediation if they feel the industrial actions threaten the health and safety of the general public. Although, it has also ended strikes when the risk to public health isn’t always straightforward.
Once a strike is broken up by the government, the two parties are forced to a national mediation board.