The “Patto di Fabbrica” (Factory Agreement) of 9 March 2018: the new industrial relations

Last 9 March, Italian Trade Unions Confindustria, Cgil, Cisl and Uil, after years of unsuccessful attempts, have signed the so-called “Patto di Fabbrica”, which sets out a framework of shared rules on bargaining, industrial relations, representativeness, welfare and corporate security. The main objective of the Agreement is to modernize and newly define the industrial relations and the organization of collective bargaining with a view to ensuring growth of the national economic system as a whole. Within the agreements reached by the social partners, certainly worth of notice is the reaffirmation of the centrality and important function of the national collective bargaining agreements, the source of governance of employment contracts and guarantee of financial and regulatory conditions, as well as an instrument to stimulate an “upright development” of second-tier collective bargaining negotiations where pay increases will be closely connected to productivity, quality, efficiency, profitability and corporate innovation. Emphasis has also been placed on the enhancement of digitalization processes and on the forms of workers’ participation. The representation measurement of employers’ associations has also been introduced as an anti-dumping measure in order to avert the proliferation of “pirate” collective agreements, stipulated by unions with no representation power and setting out financial and regulatory conditions that can harm competition. In this context, the certifying and monitoring function of CNEL (National Council for Economy and Labour) is strengthened. The “Patto di Fabbrica” is certainly an important milestone in the industrial relations even if presently it is an economic policy platform made of good intentions which must be followed by concrete actions to ensure the desired growth.