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1 August, 2011  ▪  Vasyl Karpinsky

The Twilight Of Trade Unions

Why Ukrainian workers are unable to defend their rights

The lower standard of living caused by the recent crisis and the Cabinet of Ministers’ cuts in social spending should, it would seem, fuel society’s demand that trade unions and NGOs defend the rights of hired workers. The issue became even more urgent after the Verkhovna Rada passed a government-sponsored pension reform bill which further complicates life for average Ukrainians. However, Ukrainian trade unions, unlike those in Egypt, Tunisia or Libya, are unable to spearhead, or even generate, resistance to the pressure exercised by the government which has teamed up with big business to put the trade union movement under its control.

United, they are many

The Unified State Register of NGOs lists over 500 trade unions, a quarter of which have national status. Nearly 90% of their members belong to the biggest and oldest body – the Federation of Trade Unions of Ukraine (FPU). In a recent interview its chair, Party of Regions MP Vasyl Khara, said that it has a membership of about 8 million. Unions under this federation's umbrella are often called “official.”

“The structure of the FPU does not even come close to a trade union in the universally accepted sense,” says Oleh Vernyk, head of the central committee of Labor Protection, one of the independent trade unions. “The FPU’s primary organizations are set up almost without exception to meet the needs of administrations, i.e., employers. Membership is usually a mere formality. The accounting office often deducts membership fees even without a personal application for membership. The public at large still perceives the ‘official’ trade union as a structure that occupies itself exclusively with distributing holiday packages on preferential conditions and providing financial aid.”

The Confederation of the Free Trade Unions of Ukraine (KVPU), headed by BYuT MP Mykhailo Volynets, is much smaller. It emerged on the wave of perestroika and the first years of Ukraine’s independence. At the time, it seemed that workers ' unions would no longer be the “school of communism” which they were in the USSR, and would turn into the classic European model of protecting members against employers rather than ruling over them together with management.

KVPU members believe their organization is a free trade union, while their opponents in the FPU claim that this and other independent trade unions exist on foreign donations. “They are not concerned with collecting membership fees, because they have grants or rent from their property,” explains Hryhoriy Kabanchenko, deputy head of the National Forum of Trade Unions of Ukraine, another structure that positions itself as independent. “There used to be a third source of financing – the reserves of the social security system. Independent trade unions began to manage funds more efficiently; they had less staff and they did not steal, or at least not with abandon. The FPU refused to perform management of social security altogether in order to keep independent trade unions from emerging.” But not all trade unions have financial problems. There is recently a growing number of “yellow,” or puppet, trade unions. This is what they call organizations of workers set up on the initiative of employers. These differ from official trade unions in that they are under the employers' complete control and act exclusively in the interest of management.

For example, under President Leonid Kuchma, one central Ukrainian TV channel  — with the support of management — set up a trade union which was meant to protect the rights and interests of journalists. It engaged in collective bargaining, had a proper labor relations agreement with the owners and in general did not differ in any significant respect from its European counterparts. The only exception was that it closed its eyes to censorship and secret instructions within the TV channel.

Corporate unions of workers within one large enterprise have a function of their own. These are set up by banking, insurance and other private financial institutions, as well as by oil companies, retail networks and telecommunications companies. “Large business is perfectly aware why it needs puppet corporate pseudo-trade unions,” Vernyk explains. “They mean advantageous financial transactions via non-taxable trade union accounts, a firm grasp on the personnel in the case of outbreaks of employees’ resistance, and so on.”

Another task faced by corporate or “yellow” trade unions is to prevent information leaks about the enterprise’s internal affairs, the system of wages, tax evasion and many other things the owners prefer to keep away from the public and the law enforcement agencies.

The smallest organizations are often most radical and aggressive in protecting their members. A case in point is Protection of Labor. According to open sources, it numbers a mere 1,500 members, but it is a member of the UNI international association of trade unions. It is hard to categorize, so organizations of this kind are often called alternative, while opponents in larger unions disdainfully refer to them as “marginal.”

Soviet heritage

According to Simon Pirani, one-time editor of The Miner, a trade union newspaper in Great Britain, most Ukrainians still believe that a trade union is some kind of organized management as was the case in Soviet times. In contrast, British trade unions are organizations set up by workers themselves to protect their rights against encroachments on the part of employees. Pirani studied the trade union movement in the USSR and later in Ukraine. He believes that 20 years of independence is too short a historical period to significantly change the situation.

Volynets has his own explanation of factors which he believes keep independent unions from developing. “Government bodies, organizations of employers and the FPU are engaged in systematic activities aimed at destroying the independent trade union movement,” he explains. “In these conditions it is impossible to freely develop such unions or efficiently represent and protect the interests of hired workers before employers and government bodies or to build social dialog.” Volynets cites numerous examples of pressure and illegal firing of KVPU activists, threats against them and beatings. According to him, neither the current government, nor international organizations are reacting to violations against trade union members.

Viacheslav Roi, chairman of the Federation of Small and Medium Business Trade Unions, offers a different explanation: “The very existence of the property which belonged to Soviet trade unions is one of the main reasons – if not the foremost one – for the decline of this movement in our country.”

The property he is referring to was nationalized and transferred to the FPU after the breakup of the USSR. Leaders of most independent trade unions believe that government officials purposefully tried to ensure the loyalty of the FPU when they passed unpopular economic decisions and during privatization.

According to Roi’s estimates, the property transferred to the FPU is worth nearly USD 2 billion. The federation also receives all returns from it, which creates unfair conditions for other trade unions. “Now they declare they have USD 140 million worth of this property. Where has the rest gone?” Volynets wonders, “The FPU is in illegal possession of this property and collects profits from it. Leaders of trade unions are exploiting it and they have long been watched by law enforcement agencies and the Prosecutor General’s Office.”

Several months ago, The Ukrainian Week contacted the FPU with a request to present its view on the problems of the trade union movement in Ukraine and react to criticism leveled against it. There has been no reply.

Pulled by the strings

On numerous occasions, FPU leaders threatened the government with radical action if it refused to change its stance on pension reform. However, they did nothing more than voice declarations and organize small rallies.

Volynets and Kabanchenko point out that the government has no shortage of means with which to pressure the federation in order to nip any serious protest in the bud. “Even if any of the trade union members or activists were courageous enough to speak up against the situation on the labor market or in the context of social dialog, the law enforcement agencies tell the old trade unions: ‘You have embezzled property! Another protest, and you will have to speak to the Prosecutor General’s Office,” Volynets says.

That this is no empty talk is evidenced by a conflict which erupted after the Prosecutor General’s Office opened an investigation into the FPU’s attempts to rent out health resorts belonging to Ukrprofozdorovnytsia, a company it controls. The Prosecutor General’s Office also said it intended to return to the state the properties the FPU had previously sold. Khara countered that the Prosecutor General was acting on orders and denied any wrongdoing. At the same time, he maintains that a trade union has the right to sell its own property and the Prosecutor General’s Office should not interfere.

Despite this conflict and public rhetoric surrounding it, it appears that the FPU cannot a priori become more radical under its current leadership or in its present conditions. Khara is still an influential Party of Regions MP and counts on the support of the president. He openly tries to find favor with him: “It is my firm conviction that Mr. Yanukovych is not aware of all these details and has absolutely nothing to do with it (pressure from the Prosecutor General’s Office and the government’s bid to nationalize the FPU’s assets. – Ed.). I believe that our first meeting will put things in the proper perspective. I do not conceal that I share his views and am his supporter.”

Pirani recommends paying attention to corruption in post-Soviet trade unions but not only to the financial aspect, i.e., when their leaders clearly accept bribes: “There is another type of corruption – political and ideological. […] This is when trade union leaders persuade themselves that ‘social harmony’, ‘the good of the economy’ or other such principles are more important than workers’ interests.”

If you look at the FPU’s most recent actions, some of them fit the definition of political corruption. For example, thanks to the support of its leaders the Law “On Social Dialog in Ukraine” was passed and went into effect. All independent unions say that it unfairly splits trade unions as “representative” and “non-representative” and gives preferences to the FPU only. Independent trade unions will thus be denied access to negotiations in their respective sectors and to the management of social funds. In this way, hundreds of thousands of hired workers who are members of their unions will be unable to fully defend their interests.

The final passage of the new Labor Code, also supported by the FPU, will bring about even worse consequences. Roi believes that this body of laws legalizes unfair relationships between workers and employers which have taken shape in Ukraine in the past 20 years. These include, for example, a complete lack of any real responsibility for a failure to pay wages, hired labor without proper registration or the right not to count hours of “waiting” toward working time. Irregular working hours without any compensation will in essence be legalized. According to many experts, these and other clauses of the Labor Code create conditions for the destruction of any trade union that would be independent of employers.

Changes are still ahead

Today the government has enough leverage to influence the FPU and prevent it from becoming radical. But experts say time will take a toll on the status quo. “Ukraine is becoming increasingly integrated into world capitalism, and the problems of trade unions are becoming more and more like those experienced by other countries,” Pirani explains. “With the support of the IMF, the government is now tackling the reform of pensions and other social payments. The price of this reform will be paid, above all, by Ukrainian workers.”

Volynets believes that the current processes in Ukraine will spur citizens into more active resistance in the near future: “In the fall, the struggle will intensify everywhere. In the spring people just want to plant their kitchen gardens and they are happy that the cold winter is over. When fall comes, they speak up more actively and are inclined to struggle. Negative factors also make their contribution — higher prices, frozen wages and a lack of rights and hope — all this will push them to struggle.”

“It will be the task of trade unions to encourage workers’ collectives and individual workers to take things into their own hands when it comes to resisting harassment by the government,” Pirani says, adding, “It is a real challenge for trade unions.”

However, the problem is that Ukrainians still perceive trade unions as administrative organizations created after the Soviet pattern. Neither their leaders, nor rank-and-file members have experience in actively fighting for their rights.


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