Special Report - Is there power in Europe's unions?

OVIEDO, Spain/MODENA, Italy (Reuters) - Union power runs deep in the northern Spanish province of Asturias. A series of strikes against right-wing dictator General Francisco Franco in the 1960s made the area a symbol of courage and defiance against the regime. Today, though, Asturians are less sure what unions stand for.

"Unions pretend to defend young people but their actions give them away," says Yasmina Fernandez Fernandez, a 26-year-old lawyer passing by the General Union of Workers' (UGT) building in the provincial capital Oviedo one day last month. Fernandez is a member of the UGT, signed up by her father who first joined clandestine workers' groups during the Franco era when free unions were banned. "Back then they really did defend workers' rights, something they don't really do any more," she says. "My father is disappointed by what's happened to them."

As economic crisis has gripped Spain over the past two years, Fernandez has waited for her generation's call to the barricades. The economy is barely growing after the worst recession in more than 50 years. The financial crisis and the end of the housing bubble have pushed unemployment in Spain above 20 percent. Youth unemployment is double that.

But when the call for action came in June, it lacked a sense of urgency. Workers would strike in three months, union bosses said, after the summer holidays. Fernandez was perplexed. "The unions shouldn't have waited so long before calling the strike: there's a lot of discontent with the government," she says, standing in front of the granite union building with its large red poster calling workers to act. "They do run some very good free courses for members on languages for instance. I did one once, but they're almost impossible to get on."

Spain's workers finally strike later this week, joining comrades across Europe in a day of protest against the continent's budget cuts. Workers in Britain, France and Greece plan protests or strikes over the coming weeks. As Europe struggles to grow again after the worst downturn in 70 years, others will surely join them.

So far, though, the most remarkable thing in this age of austerity is just how few strikes there have been and how weak and ineffective unions have proved. In many ways, Europe's workers are among the best protected in the world. When the temples of capitalism fell two years ago, some pundits dug out old copies of Marx and predicted the return of unions and worker power. But the crisis has laid bare a truth partially hidden during the boom years: Europe's unions are less powerful, less influential, and less relevant than they have been for decades.

"In Europe generally there is a feeling that unions are facing a crisis," says Charles Powell, history professor at the CEU-San Pablo University in Madrid. "It's a question of identity as well. What sort of movement should they be? Should they be exclusively geared to obtaining improvements for their members? Should they have a say in broader issues like the environment?"

NUMBER CRUNCH

That confusion may be one reason why support for this week's general strike in Spain -- the first since 2002 -- is so underwhelming. Though a growing number of Spaniards consider the strike justified, only 9 percent say they will definitely support it, while 73 percent say they definitely or probably won't, according to a poll in the left-leaning newspaper El Pais. Even many union members are expected to work as usual, sapping the potential of the protest to change policy.

It's a similar story in Greece, where even in a year of financial woes, protests have paled in comparison with the past. Barely 12,000 people rallied outside parliament on July 8 as lawmakers passed a sweeping and controversial overhaul of Greece's ailing pension system. Compare that to the more than 100,000 people who turned out against a similar pension plan in 2001, or the student protests that helped topple a right-wing military junta in 1974.

Perhaps the deaths of three people during a May rally in Athens was such a shock it deterred people. Or maybe the gravity of Greece's position has convinced people protest won't work. "Greeks realise that the system needs reform and that there will be victims during this transitional period," says Costas Ifantis, a political scientist at the University of Athens. "They don't accept austerity, they just put up with it. And this comes with a condition: that the government will fix things."

In France, between one and two million people marched through the streets earlier this month to protest government plans to raise the retirement age by two years. In Britain, workers on London's underground rail system unhappy with staff cuts held the first of a series of one-day strikes. But in both countries, action has remained limited compared with the rolling strikes of the 1970s and early '80s. It's a pattern repeated across Europe, and perhaps especially in the south: workers are disgruntled and angry, but seem unsure what to do about it and nervous that a tough stance might hit their wallets.

One of the reasons for the drop in militancy is obvious: fewer people belong to unions now than two or three decades ago. Figures on membership are hard to find, but the statistics that do exist clearly show a downward trend. A 2006 study in the respected journal "Monthly Labour Review" found that Europe's union density -- membership as a proportion of the total workforce -- fell between 1970 and 2002 to 26.3 percent from 37.8 percent. In France the fall was to 8.3 percent from 21.7 percent; in Britain to 29.3 percent from 44.8 percent; in Germany to 22.6 percent from 32 percent.

In former eastern bloc countries, where union membership was compulsory until the end of communism, rates have plummeted in the past two decades -- by more than 90 percent in some cases. The decline is continuing. A report by the European Foundation for the Improvement of Living and Working Conditions found that union density rates fell in 22 out of 24 countries in the five-year period to 2008. But the numbers don't explain unions' loss of popularity, or why it's occurred.

HAS SUCCESS BRED COMPLACENCY?

It's a short walk from the imposing UGT building in Oviedo's central square to lawyer Fernandez's workplace, an ecological hotel fitted with energy-saving light bulbs, solar panels and a wind turbine. Fernandez's 39-year-old boss, Lisardo Hernandez Cabeza, is exactly the kind of innovative entrepreneur the local authorities want, to judge by a regional economic slogan: "Del carbon al raton", ("From coal to the computer mouse").

Hernandez won't be creating any new jobs for the moment, though. In fact, he's scared of hiring.

In the hotel restaurant, tables are beautifully laid out with glasses and white linen, but the kitchen is closed. Hernandez sacked the chefs for not following orders, he says. A court ruled the dismissals were unfair and Hernandez could face a hefty bill of over 9,000 euros per worker.

"Something has to be wrong when 90 percent of labour disputes go in favour of the worker," Hernandez says as he shows a visiting reporter around the hotel. "What frightens employers here is that when a worker is on a temporary contract he's very good, and when you put him on a fixed contract and he has all the rights, that's when he starts not coming in today or tomorrow, saying he's got a headache."

Bosses may grumble, but millions of Europe's workers love the rights they enjoy -- and with good reason: the continent has some of the most generous protections in the world.

Paradoxically, as rights and benefits have improved, and as the European Union has pushed the idea that protections should apply to all workers, Europeans may see less reason to organise.

In Spain, where just 17 percent of workers are unionised, the majority of full-time employees have their terms and conditions of employment determined through collective negotiations. In places such as Norway, Sweden and the Netherlands, rights often now extend to part-time workers. Across the continent, rights that workers once had to fight for have become standard.

Historian Powell argues that "a new kind of social contract" exists -- one in which unemployment benefits, equal pay for equal work, security and health in the workplace, holidays, the right to onsite training are "more or less things that are universally accepted."

The European Union, he says, "has been quite ambitious in this area. To some extent it's deprived trade unionism of some of its traditional concerns and struggles... That's part of this question of a new identity for the unions - hence their difficulty in finding a new role for themselves."

Union bosses question that assessment. In June, the Spanish government forced through reform to make it cheaper for companies to reduce severance pay to workers with permanent contracts -- if the company can prove its business is affected by a downturn. Employer groups have complained that the new law does not go far enough. The law does not precisely define what constitutes a crisis-affected business, meaning many redundancies will still end up in the courts.

Unions, though, view the reform as carte blanche for employers to sack good staff. "We are facing the greatest aggression against workers' rights in the history of democracy of this country -- and that's not just a catchphrase," says Antonio Pino, general secretary of the Asturias branch of Spain's largest union, the Union Confederation of Workers' Commissions (CCOO).

That's why miner Jose Carlos Pazos Fernandez, 40, will join the general strike this week. "What's one more day in lost pay in all the days I've lost in strikes in 20 years?" he says, his teeth white against his coal-blacked face as he smokes a cigarette at the end of his morning shift at the Santiago mine in Caborana, Asturias.

THE WORLD-WEARY YOUNG

Spain is a lot richer now than it was 30 years ago, and a lot more focussed on individuals, according to Benjamin Gutierrez Huerta. He runs a foundation that the CCOO in Oviedo set up to explain the history of unionism in Asturias, and his career reflects that change.

Gutierrez, 37, comes from a mining family but studied history instead. As a child, he remembers a spirit of solidarity in the mining community, where unionists were respected figures. "When I was small, the first thing I wanted to be was a carpenter and the second was a union rep. I listened to my father speaking and the most important thing you could be, not in terms of money, but in terms of importance, was a union rep."

As Spain's economy boomed, though, respect for union organisers slipped. Gutierrez uses a variant of the "man walks into a bar" joke to show the changing image of unions. "In the 1970s when a union rep walked into a bar, everyone bought him a drink. In the '80s, the union rep bought the drinks. In the '90s, when he walks to the bar he looks the other way as if he doesn't know anyone, and the people look away as if they don't recognise him. What will happen in the 2000s? That has still to be seen."

If young Spaniards are anything to go by, the answer may not make union leaders happy. A person turning 20 in Spain today may be part of a generation that ends up worse off than the one before it, reversing the long-term trend. Twenty- and thirtysomething Spaniards resent the fact that the only jobs they can get are on temporary contracts -- which offer fewer rights than permanent positions.

Rather than looking to the unions as the answer, though, Spain's young see them as part of the problem: one piece in a sclerotic system that protects older workers and shuts the young out.

That's especially true when it comes to the public sector, which is the real stronghold of unionism in Europe today. Up to a quarter of Spain's two mainstream unions -- the CCOO, which was the union of the now defunct Spanish communist party, and the UGT, seen as close to Spain's Socialist party -- derive their membership from the state sector.

Unions in the public sector neglect workers on short contracts and focus exclusively on those who have secured "a job for life", complains Luis Gutierrez Fernandeztresguerres, 33, who as a librarian at Oviedo University enjoys a permanent contract himself. "They should defend the interests of the vulnerable."

Union leaders argue that they defend all workers -- and accuse critics of whipping up divisions between public and private-sector workers and between permanent and temporary workers. "There is a campaign in the newspapers at the moment to make us think it would be better to scrap unions," says Raul Monteavaro Garcia, 33, a gardener and a member of CCOO. "People on short contracts don't join a union because they're frightened if they do they'll lose their job. Unions are a necessary evil: we workers are in a bad state with them, even worse without."

ACROSS THE MEDITERRANEAN

If Spain's young are disillusioned, then Italy's pensioners are no better. Giancarlo Montagnani is a sprightly 65 year-old with bright blue eyes and memories of a life spent working in ceramics factories around Modena, an attractive Renaissance city in Italy's northern Po Valley.

Montagnani started work at 14, retired 12 years ago, and is still enrolled in Italy's largest trade union, the left-wing General Confederation of Italian Labour (CGIL). But even he can see times are different.

"They always defended my interests, and I still pay my dues from a kind of gratitude, but everything has changed now," he says, talking animatedly with friends in a park. "We were more united. If you went on strike for a payrise then you usually got one, but now people are afraid of losing their jobs and the unions themselves tell you not to strike."

Union membership in Italy remains relatively high at about 30 percent of active workers, though that's down from a peak of 43 percent in the 1970s. Among pensioners it is probably the highest in the world, thanks partly to a controversial system in which workers have to actively "opt out" of their union when they retire.

Montagnani and his pensioner friends agree the unions could never bring down a government now, not only because they are not united but because workers have become more individualistic, focussed only on bringing home a salary at the end of the month.

The 10 or so men in the group also agree that rising unemployment, immigrant labour and the shift to manufacturing plants abroad mean it's now the bosses who "have the whip hand."

When Montagnani began work in 1959, Italy was just embarking on an economic miracle that would see decades of growth at rates like those now seen in China. Over the past 15 years of stagnation and bouts of recession, the men say protest could well mean your job disappears to Eastern Europe.

"The power of Italian workers has fallen sharply due to globalisation and the availability of immigrant labour, and the workers know that," says Paolo Feltrin, a union expert and political science professor at Trieste University. Feltrin says the transformation of Italian industry in the last 30 years has curbed union influence, as large factories have been replaced by thousands of small businesses, where unions find it harder to gain a foothold. In the past decade or so, increased competition from Asia, especially in low-tech sectors such as textiles, has continued that shift.

"Companies can move production abroad and workers don't want to lose money in strikes when they know the battle is useless," says Feltrin. "It's no coincidence that strikes are still an effective tool largely in the public sector, where workers are more protected, because you can't move hospitals, schools or government ministries to China or India."

FEUDING UNIONS

You can see what the loss of production does to an industry in small towns like Fiorano, Sassuolo, Formigine, Spezzano and Serramazzoni, which ring Modena and which together boast around 200 factories producing tens of millions of tiles every year for the world's bathrooms and kitchens. The sector has been hard-hit by the recession of the last two years, and while local industry still directly employs more than 20,000 people, its dominance of 20 years ago is threatened by cut-price competition from China.

Locals say 5,000 lorries used to leave the factories every morning. Today, it's down to 1,500. Franco Sita, a 73 year-old with snow white hair and beard, began work at 14, and worked for 20 years at Iris Ceramica, one of the largest of Fiorano's factories. "I asked for a job on the Friday and the guy told me to start on Monday. I said 'Can I start on Wednesday'?, and he said 'No, we need someone on Monday.' It was so easy back then."

Sita is also still enrolled in a union despite not having worked for 15 years. But it's not the same one as Giancarlo, which is a significant detail. Deep divisions between Italy's main union confederations are another factor in the movement's loss of clout in recent years.

Sita shunned the CGIL in favour of the more moderate Italian Confederation of Workers' Unions (CISL) "because I've never been a leftist."

The CGIL has almost 6 million members, over half of whom are pensioners, compared with 4.5 million for the CISL. The smaller Italian Labour Union (UIL), which takes a similar, moderate line to the CISL, numbers around 2.2 million.

Back in 1994, when the three unions fought alongside each other, they brought down Prime Minister Silvio Berlusconi's first government with their mass protests over plans to raise the retirement age. As recently as 2002, in their last major show of unity, they forced Berlusconi to backtrack on policies to ease firing restrictions, though even then the CISL and the UIL declined to participate in a historic rally of some 2 million workers organized by the CGIL.

But in recent years acrimony between the unions has grown, with the CGIL accusing the other unions of betraying workers with their increasingly conciliatory, pro-government positions. In July, when Berlusconi announced a 25 billion euro austerity package that cut local government funding, froze public sector salaries and raised the retirement age, only the CGIL staged protests while the other unions said the measures were tough but necessary.

LAST LINE OF DEFENCE

As in Spain, a generation gap has opened up in Italy. While trade union loyalty remains high among many nostalgic pensioners, it is weakening among active workers. "At work you have to look out for yourself, you'll die of hunger if you follow the unions," says Giovanni Nuzi, a swarthy 47 year-old who has worked for 10 years at Florim Ceramica in Spezzano.

Nuzi left his home in the poor south-eastern Puglia region two decades ago to look for work but is considering going back, having spent much of the past three years at home on reduced pay due to the economic crisis.

He is enrolled in the CGIL but insists this is only for their help with tax returns and paperwork. He has never been to a protest rally or gone on strike. "If I strike I'm considered a trouble-maker and at the first excuse they chuck you out," he says. "Before, you could leave one factory and walk into the one next door, but it's not like that anymore. The companies have the power now."

Some 100 miles to the north-east in Padua, services and manufacturing are more diverse and political sympathies lean firmly to the right, but the economy has been similarly ravaged by recession -- and trade unions are struggling.

After the owners of iron foundry Fonderia Zen declared bankruptcy last December, the workers kept production going in a spectacular attempt to keep the company afloat. "We basically ran everything ourselves for three months to meet orders," says Aristide Trivellato, a 51 year-old assembly line worker. "We were here all hours and my marriage nearly collapsed, but it was also an enriching experience."

For the past 21 months, the foundry has run reduced shifts and workers have taken it in turns to spend time at home on lower pay. But they still have their jobs and they say there are signs that business is improving.

Aristide, like other colleagues who chat about their experience at the end of the morning shift, is a committed, left-wing CGIL member. Often speaking in thick Paduan dialect in a factory hut decked with a Cuban flag and other leftist icons, the workers are proud of what they have achieved, but also exasperated by the political apathy of their colleagues. Unions, they say, are now reduced to a rearguard action to save jobs. It's a last line of defence, rather than a first line of attack to secure wage rises or even change government policies.

"There will never be social revolt in Italy because there is no leadership on the left, no union unity and no social cohesion, it's each labour category for itself," says Ivan Maso, 41, who checks the chemical components of the iron ore every morning in factory temperatures of around 45 degrees Celsius.

MOVING THE GOAL POST

For many of these workers, European labour protections are a cruel joke. Fifty-six year-old Silena Trentin was earning 900 euros a month as a textile worker in Padua until June, when the clothes factory where she worked went bust.

Trentin doesn't want her job back, she says. She wants her money for several months of unpaid work. And she is desperate to retire. Successive governments have kept "moving the goal posts" by raising the years of pension contributions needed for retirement, from 35 to 37 to 39, just as she approached the previous target. But the company went bust when she was just a few months short of the current requirement of 40.

A longtime unionist, Trentin sees a bleak future for organised labour in Italy, as traditional industries are replaced by services and more and more jobs are offered on temporary contracts with few protections. "Years ago when the union reps said 'Everybody out!', everybody got up and walked out. Now, even when we weren't being paid, a lot would stay put and say: 'Why, what's happened?' It's incredible, now people are willing to even work for nothing."

COMPETITION AND YOUTUBE

Could that change? Will hard times in Europe lead to stronger unions, a rebirth of the labour activism? "Potentially, yes. They have nowhere to go but up," says historian Powell in Madrid. "If they do succeed in finding a voice which is relevant, the danger of course is that they move in a much more competitive environment now. You have NGOs, the green movement. It's a much more competitive world for them as organisations than it was in the '70s. People have other institutions to turn to.

" If this year's strikes are anything to go by, worker power in China and South Africa and other fast-growing economies is growing. In Europe, it's often harder to get workers on the street.

To drum up support for this week's strike in Spain, the general secretaries of the country's two largest unions embarked on a whirlwind national tour this month to explain their stance. In order to win over the young, one has launched a video competition on the strike, while the other is running a controversial series of Youtube videos starring a caricatured boss playing games in his office, behaving in a sexist fashion and patronising workers.

"When a union needs to call a general strike for three months down the line, it's because they need a lot of time to convince people to come out in support," says Ana Maria Villanueva, 50, a hotel worker having a glass of wine on the terrace of an Oviedo bar with a friend after work. "The unions are doing a lot to force an impact, but I don't know to what extent they'll manage it."

(Additional reporting by Renee A. Maltezou/Athens)