FES BRIEFING CROATIA Trade Union Monitor May 2022 POLITICAL, ECONOMIC AND SOCIAL ­DEVELOPMENTS AND FACTS POLITICAL DEVELOPMENT The centre-right Government led by the Croatian Democrat­ic Union(HDZ) remained stable in spite of its narrow parlia­mentary majority and turnover in ministerial posts unseen in any previous Croatian Government – since assuming the post of the Prime Minister in 2016. Andrej Plenkovi ć has replaced 15 of his ministers, due to charges of corruption, conflict of interest or allegations of incompetence. Local elections, held in May 2021 brought fresh political forces to power in the capital city of Zagreb. The green-left political platform Možemo!(We can!), formed by a group of civil society activ­ists, swept the elections for the city council with 41 per cent of the vote. Its leader Tomislav Tomaševi ć convincingly won direct elections for mayor, scoring 64 per cent of the vote in the second round. Elsewhere, HDZ kept the position of the strongest party with the largest number of mayors and local councillors, while the Social-democrats(SDP) continued their decline. The fate of SDP remains unclear, as the party under­goes a massive restructuring in terms of personnel and pro­grammatic renewal. In terms of personnel, a high number of party officials was removed from SDP due to charges of nep­otism or corruption – even the parliamentary group was split in half. The programmatic renewal of the SDP might be a window of opportunity to strengthen cooperation with the Trade Unions again, as a part of the new party leadership shows high interest in labour laws and labour relations. Political developments of relevance for the trade unions were dominated by continuing talks on the new Labour Act, amendments to the Minimum Wage Act and the measures related to the pandemic. Trade unions also closely moni­tored and voiced their opinions on the Government’s reac­tion to the growing prices of energy and consumer goods. The process of drafting the new Labour Act, initiated in au­tumn of 2020 and followed by months of intensive talks be­tween the Government and social partners, has by March 2022 failed to produce any concrete results. In October 2021 the Ministry of Labour, Pension System, Family and Social Policy has presented the first draft of the new law to social partners, but subsequent discussions made it uncer­tain how much it would be changed in the process. At the moment of writing, due to prolonged consultations and possible resignation of the Labour Minister who is facing charges for corruption on his previous post as head of the Pension Insurance Institute, it seems likely that Govern­ment’s plan to adopt the new law by June 2022 would be abandoned and that the process will be prolonged at least until the end of the year. In December 2021, amendments to the Minimum Wage Act entered into force. The definition of the minimum wage was extended to include not only the minimum wage set annu­ally by the Government, but also lowest wages for different categories of jobs set by sectoral collective agreements with extended application. The later refers to the Labour Act pro­vision which allows the Labour Minister to extend applica­tion of sectoral collective agreements to all employers and workers in the sector, if this is assessed to be in the public in­terest. Corollary of this legislative change is that wage provi­sions of sectoral collective agreements(although only those with extended application) for the first time fell under com­petences of the labour and tax inspection. While the legally obligatory wage additions for overtime work, night work and work on Sundays and public holidays have already been excluded from the calculation of the minimum wage, addi­tions for hard working conditions were now also added to this list(although they are not legally obligatory). In spite of calls from some trade unions to do this, the Government has refrained from legally prescribing the amount of mentioned wage additions, which are traditionally set by the collective agreements, but has expressed intention to reassess this po­sition in two years. This was intended as an incentive for sec­toral collective bargaining, allowing a time for the social partners to conclude more such agreements which would cover a much larger share of workers than is currently the case, if they want to keep negotiations on these additions in their domain. 1