Collective labor agreements

Insight and advice on collective labor agreement applicability

For many employers, one or more collective labor agreements (CAOs) have an impact on the employment conditions within their organization. However, determining the applicability of a CAO is not always straightforward. CAO law has complex rules regarding binding, scope, and possibilities for deviation. Legal advice is therefore not a luxury.

When is a CAO applicable?

A CAO can be applicable in different ways:

• The employer is a member of an employers' organization that has concluded the CAO;
• The CAO has been declared generally binding and thus automatically applies to the entire sector;
• The CAO has been contractually declared applicable in the employment contract.

In addition, the question of whether the employee is a member of a union that is a party to the CAO also plays a role. All these forms of binding can coexist, with different legal consequences.

What are the implications for you as an employer?

If a CAO (whether or not through after-effect) is applicable, you must adhere to the employment conditions established therein. Failure to comply with CAO provisions can lead to legal claims or additional assessments. Therefore, it is crucial to know:

• Whether your business falls under the scope of a CAO;
• What the exact meaning of specific CAO provisions is;
• Whether and to what extent you may deviate from CAO agreements (for example, for certain positions or above-CAO employees);
• What your options are for exiting a CAO or establishing your own arrangement.

Our support with CAO issues

We advise employers on:

• The applicability and interpretation of CAOs;
• Negotiations on new CAOs or deviating arrangements;
• The (im)possibilities regarding CAO modification or termination;
• Drafting employment contracts in line with CAO agreements.

Do you want to know if a CAO is applicable to your organization and what that means for your employment conditions? Contact us for tailored legal advice.