Employee Welfare and Collective Bargaining in Exposed and Protected Sectors: Evidence from Poland and Serbia

Collective bargaining is closely related to social policy making to the extent that the outcomes of the former inform and influence social policy agenda. It is widely held, however, that trade unions in Central Eastern Europe (CEE) do not have a strong bargaining position and thus exert little impact on policy decisions. This paper challenges the view of CEE labour as a uniformly weak actor. It argues that CEE unions’ ability to shape the bargaining agenda and social policies depends largely on the degree of privatization, which overlaps with sectoral divisions. We find that unions in exposed sectors are unable to oppose greater flexibility even when there are no considerable wage gains, whereas workers in protected sectors manage to maintain their status and at times even enhance their welfare, both in terms of higher wages and better working conditions.