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46

4.1. IntroductionThis chapter will analyse such characteristic of

labour such as employment and unemployment, labour remuneration issues, labour relations and the social dialogue, as well as labour safety and health protection in the workplace.

The Law on Support to Unemployed Persons and Job Seekers came into force on 1 July 2002. The purpose of Law is to establish a support system for unemployed persons and job seekers. The Law prescribes the active employment policy measures and preventive measures for the reduction of unemployment provided for unemployed persons and job seekers, the competence of the state and local governments in the implementation of these measures, as well as the status, rights and duties of unemployed persons and job seekers.

The purpose of active employment policy measures (vocational training, re-qualification and qualification improvement, paid temporary community work, measures to increase competitiveness, measures for specific groups of persons) is to realise labour market policy in order to reduce unemployment, particularly, in order to engage unemployed persons and job seekers in them, to motivate them to actively look for work, to promote the development of an able and trained labour force equipped to meet the requirements of the labour market and to promote an improvement in the competitiveness of unemployed persons and job seekers as they seek to enter the labour market.

Preventive measures for the reduction of unemployment include professional orientation and consulting services and are provided for persons who would like to acquire an education or who are working or would like to work in a paid job. The purpose of this measure is to promote the competitiveness of people in the labour market and to provide them with assistance in the choice of their career.

In accordance with Clause 59 of the Labour Law, labour remuneration is a payment regularly paid out to employees for work that includes the labour salary and the additional payments prescribed in regulatory enactments, in the joint employment agreement or employment agreement, as well as bonuses and any other type of payment related to work. The definition referred to is all-embracing, because it precisely indicates all the elements of labour remuneration. The notion of labour remuneration incorporates another type of compensation related to work, accordingly expanding the understanding of the notion of labour remuneration in comparison to the generally accepted practice of recent years. For example, if an employer pays for an employee’s travel card so that he or she can arrive at work, this is considered to be an element of labour

remuneration. However, in regard to this last comment, it should be pointed out that this alternate type of compensation has a meaning, determining equal labour remuneration for men and women for the same work or that of equivalent value. However, it is meaningless if the discussion turns to the calculation of average earnings.

Nationally, labour remuneration is regulated by the minimum labour salary, which is the lowest labour salary that all employers must pay their employees on a compulsory basis for labour performed within the parameters of normal working hours (40 hours a week). Several Cabinet of Ministers’ Regulations prescribe the labour remuneration for employees employed by institutions funded from the state budget.

During the reference period, the minimum labour salary was raised twice, increasing it from 50 LVL in 2001 up to 60 LVL in 2003. The increase in employment remuneration of 10,9% in Latvia during 2003 was one of the largest among EU member states and candidate countries.

Employment rights are a set of regulatory enactments that regulate relations between employers and employees, which are to be founded on the basis of an employment agreement.

The social dialogue is a long-term co-operation process in which social-economic partner relations are established. It is a type of co-operation between employers (organisations representing employers), employees (organisations representing employees) and also the State, the purpose of which is to harmonise the interests of these various interest groups both in social and economic issues and to guarantee social stability and peace.

Labour relations and the social dialogue are currently regulated by the Latvian Republic’s Constitution, international legislation binding on Latvia, the Labour Law and other regulatory enactments, as well as the joint employment agreements concluded within companies and the regulations governing working procedures.

The main changes during the reference period in the area of labour relations are related to improvements in labour legislation, through the formulation of several regulatory enactments that prescribe the requirements for the labour protection of young people, as well as the cases, when the opportunity exists to enter into employment agreements for a set period of time. In order to promote public understanding regarding the social dialogue, several booklets have been published during the reference period regarding the meaning and achievements related to the social dialogue.

The main task of labour protection is to ensure the safety and protection of health of employed in the workplace, by setting the working safety system within the company and by improving the working

IV. Labour

environment itself. An effective labour protection system at both State and company level provides employees with safe working conditions that are harmless to health, accordingly reducing the number of occupational accidents and occupational diseases and thereby improving the feeling of comfort and welfare among employees that in turn has a favourable impact on the quality of working life and working effectiveness.

Labour protection norms are prescribed in the Law on Labour Protection that came into force on 1 January 2002. In order to ensure the conformity of the legal platform related to labour protection to the requirements of the Law on Labour Protection, during the reference period, several Cabinet of Ministers’ Regulations were revised and augmented. To ensure the flow of information and access to information regarding labour protection, the contact point for the European Agency for Safety and Health at Work in Latvia and its internet home page (http://osha.lv) were established at the end of 2003, in which it is possible to learn more about labour protection legislation and also to find practical and explanatory information regarding issues related to labour protection.

4.2. Employment and unemployment

The economic development of the state and the active employment policy implemented are having a positive impact on the situation in the Latvian labour market. During the reference period, the indicators for employment and unemployment continued to improve. Compared to 2001, the economic activity of population or participation in the labour market of the 15-64 years

age group has increased – in 2002 it was 68,8%, but 2003 – it had risen to 69,2%. During 2003, the economic activity of women in Latvia reached 64,7%, whereas the participation of men in the labour market rose to 74%. Likewise, the participation of older people (55-64 years) in the labour market continued to grow. However, it is comparatively low, particularly among women – 41,7%. The participation level of young people in the labour market has fallen, particularly in the age group aged 15-19 years. This is explained by the increasing importance of education in society in recent years and awareness among young people of the role played by qualified education as a factor that promotes competitiveness in the labour market. There are still considerable regional differences in regard to the economic activity of population: the greatest activity during 2003 was observed in the Rīga region – 73,7%, whereas in Latgale it was as much as 11,9% lower.

The employment level in 2003, in the 15-64 year age group was 61,8% (in 2002 – 60,5%). The employment level among women was comparatively high – 57,8% (in 2002 – 57%).The employment level among men rose to 66% in the year 2003. It should be noted that the employment level among women in Latvia has already exceeded the Stockholm interim target for 2005 – 57% (see Picture 4.1.). Analysing the structure of persons employed in basic work according to activity type, there still remains a comparatively pronounced segregation in the labour market between “jobs for men and jobs for women”. A marked proportion of women are employed in areas such as education (81%), health and social care (86,5%), hotels and restaurants (79,9%), as well as in wholesaling and retailing (62,1%)6.

In Latvia, the educational level of employed

Picture 4.1.

Source: data of Eurostat

6Central Bureau of Statistics “Labour Force Survey”, 2003

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Labour

48

population is comparatively high. At the end of 2003, 20,3 % of those people employed in basic work had a higher education, 65,7 % had a secondary education, including vocational education. Nevertheless, a section of employees lack increasingly necessary in the contemporary labour market – ICT and communication skills, knowledge of foreign languages and mastery of the basics of entrepreneurial activity.

As with the indicators of economic activity, significant regional differences were observed in regard to the unemployment level. For example, during 2003 the level of employment in the 15-64 years age group in Riga region was 66 %, whereas in Latgale region, it was only 52,1 %.

The unemployment level in Latvia continues to decline gradually – from 13,1 % during 2001 to 10,6 % during 2003. This indicator is 2,6 % higher than the EU-15 average indicator. In line with Eurostat data, at the end of the reference period, Latvia had the fourth highest unemployment level among EU candidate countries behind Poland, Slovakia and Lithuania.

Differences between the level of unemployment level registered by the State Employment Agency (SEA) and the indicator attained as a result of the labour force survey performed by the Central Bureau of Statistics point to insufficient motivation on the part of job seekers to register with the SEA. The survey carried out by the LU Institute of Philosophy and Sociology on “Social exclusion for groups endagered by unemployment; incidence of risk and it’s causes” during 2003 revealed that 78,9 % of respondents know where to register in the event of unemployment. Moreover, women are better informed regarding issues that are related to registering with the SEA. The most poorly informed group of respondents were young people with an incomplete basic education – only 43,3% of respondents from this group. Registration by unemployed persons with the

SEA is directly linked to their level of education – people with a higher level of education register much more actively as unemployed persons. Experts interviewed as part of the survey refer to the following as the main reasons why some unemployed persons fail to register with the SEA:

1) persons who discover that they are not entitled to social benefits;

2) persons who have encountered age discrimination, do not register because they think that they have no chance of finding a job.

The existing difference is also partially explained by differences among age groups, in the calculation of the corresponding indicator (CBS – 15 to 74 years; SEA – 15 to the attainment of the retirement age determined by the State). The annual reduction of this difference is good news (see Picture 4.2.).

In 2003, the unemployment for men in Latvia was 10,7% (a reduction of 2,6% compared to 2002), whereas the unemployment for women was10,5% (0,5 % less than in 2002). On average, 67,5 % of unemployed persons in Latvia at the end of 2003 had a secondary or secondary vocational education, 7,2 % had a higher education, but 25,3 % possessed a basic or rudimentary education. According CBS data, during 2003 the average unemployment level in the Latgale region was 15,5%, whereas in the other regions of Latvia it ranged from 10,3 % to 8,8 %.

During 2003, 43,8% of all job-seekers had been unable to find a job for more than a year. Even though an improvement had been noted in the situation regarding long-term unemployment during the preceding years (for example, during 2002 46,4% of all unemployed persons were long-term job seekers), nevertheless, compared to average EU indicators, the long-term unemployment level in Latvia is to be assessed as being high.

According to CBS LFS data, the unemployment

Picture 4.2.

Source: data of State Employment Agency and Central Bureau of Statistics

Groups of unemployed persons Number of registered unemployed persons

Persons listed as being unemployed %

long-term unemployed (more than 1 year) 23 617 26,1

unemployed youth (15-24 years) 12 011 13,3

unemployed disabled persons 3 165 3,5persons released from placesof imprisonment 608 0,7

persons returning from maternity leave 9 101 10,1

unemployed women of pre-retirement age8 4 836 5,3

unemployed men of pre-retirement age 3 219 3,6

7 - one unemployed person could be included in several problem groups, an unemployed person could be unemployed long-term, or a young person aged from 15 to 25 years.8 - no more than five years remain until the attainment of the age necessary for the granting of the state old age pension.

Division of registered unemployed persons by risk group7 at the end of 2003

Table 4.1.

Source: data of State Employment Agency

level among young people (in the 15-24 year age group) has fallen to 18,5% (in 2002 – 20,8%). However, it is still significantly higher than in other age groups and also exceeds average EU indicators. This points to the necessity for special measures to promote youth employment.

At the end of 2003, the SEA list contained 90551 unemployed persons (816 more than at the end of 2002) and the unemployment level registered by the SEA had reached 8,6%. The increase in the registered unemployment level can be partly explained by the changes introduced by the CBS in regard to its methodology for determining the number of economically active inhabitants.

During the reference period, the SEA implemented the following active employment policy measures:

• vocational training, re-qualification and qualification improvement for unemployed persons;

• measures to improve competitiveness; • paid temporary community work; • measures for specific groups of people. In total, the number of unemployed persons engaged

in active employment measures is increasing continually (see Picture 4.3. in page 50).

Vocational training, re-qualification and qualifi-cation improvement for unemployed persons is provided in order to increase the competitiveness of unemployed persons in the labour market. Educational programmes for the vocational training, re-qualification

and qualification improvement for unemployed persons are chosen in line with the available job vacancies registered with the SEA and the requirements of employers as determined from the results of a survey of employers, as well as the wishes expressed by unemployed persons to master a new speciality or to improve their qualifications and the actual human resources among unemployed persons for the mastery of an education programme (education, age, professional experience, gender, knowledge of the State language etc.). Of major importance in the selection of unemployed people is that a profession (speciality) in vocational training, re-qualification and qualification improvement for unemployed persons should be mastered by those unemployed persons, whose predicted return into the labour market could take place at the earliest point in time, accordingly increasing the effectiveness of the relevant measure and the funds expended.

In total, 1377951 LVL were spent on the vocational training, re-qualification and increasing qualifications of unemployed persons during 2003. 6978 unemployed people were engaged in training (2139 more than during 2002). During 2003, courses were completed by 5049 unemployed persons of whom 1563 were long-term unemployed persons, 1153 were young people aged from 18 to 25 years, 342 were disabled people, 22 were persons who had been released from imprisonment, 170 were unemployed persons of pre-retirement age and 489 were persons wishing to re-enter the labour

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market after caring for a child. Of those persons who completed vocational training, re-qualification and qualification improvement courses for the unemployed, 2616 or 51,9 % of those who participated succeeded in finding employment.

Measures for improving competitiveness (MCI) include psychological support and activities aimed at helping people to master the basic skills and know how required within the labour market – seminars, lectures, discussions, consultations, as well as other activities that promote the re-entry of unemployed persons and job seekers into the labour market.

During 2003, 303258 LVL was spent on MCI and 29180 (396 more than in 2002) unemployed persons were engaged in the referred to measures, of whom 4320 were long-term unemployed persons, 7626 were young people aged from 15 – 25 years, 1054 were disabled people, 130 were persons who had been released from imprisonment, 2376 were unemployed persons of pre-retirement age and 3213 were person re-entering the labour market following maternity leave. After engaging in MCI activities 8989 unemployed persons have succeeded in finding employment and 3854 have begun studies for unemployed persons in vocational training, re-qualification and qualification improvement courses.

Unemployed persons are recruited for Paid Temporary Community Work (PTCW) who would like to work, but who for various reasons (for example, a lack of social mobility, difficulties in adapting to the requirements of the labour market etc.) are unable to find a suitable permanent job. The performance of PTCW does not require professional qualifications. During 2003, 2839953 LVL was spent on PTCW and they involved the recruitment of 17372 (563 more than in 2002) unemployed persons, of whom 8771 were long-term unemployed persons, 1173 were young people aged from 15 to 25 years, 322 were disabled people,

135 were persons released from imprisonment, 2122 were unemployed persons of pre-retirement age, 659 were persons re-entering the labour market following maternity leave.

The purpose of Measures for Specific Groups of People (MSGP) is to preserve and improve the job skills and know how of unemployed people, thus increasing their competitiveness in the labour market and boosting their chances of finding a permanent job.

During the reference period, the SEA implemented the following measures as part of MSGP:

• work practice of young unemployed persons with an employer;

• subsidised work places for unemployed persons of pre-retirement age;

• subsidised work places for unemployed disabled people (pilot project commenced in 2001);

• subsidised employment measures for unemployed disabled people;

• measures aimed at promoting the mobility of unemployed disabled people;

• social companies in the labour market for the employment of less competitive unemployed persons.

During 2002, the 1st stage of a pilot project “Work practice for young unemployed persons with employers” was completed, as a result of which 93 young unemployed people acquired vocational training. Of these 69 succeeded in finding jobs. Following the successful implementation of the 1st stage of this project, during 2002 – 264 young unemployed people took part in the 2nd stage of the project. In 2002, the largest number of work practices was created in the regions of Zemgale and Latgale – 80 and 67 respectively. Of the young unemployed persons involved in the 2nd stage - 106 completed their practice in 2002, whereas the rest continued their work during 2003. The implemented project can be considered to be an affective employment

Picture 4.3.

Source: data of State Employment Agency

Table 4.2.

Source: data of Central Bureau of Statistics

measure, because since the completion of the 2nd stage practice, 75 % of those who took part have found jobs. During 2003, 351 young unemployed people received work practice.

During the reference period, one measure that proved very popular with both employers and disabled people was the MSGP measure “Subsidised work places for unemployed - disabled persons”. As a result of this measure, the number of disabled persons listed as being unemployed rose from 27 people during 2002 to 635 people during 2003. The highest number of subsidised work places for disabled people during the reference period were created in Riga region.

During 2002, 133 jobs were created for unemployed persons of pre-retirement age. During 2003, the number of persons engaged in this measure reached the figure of 249 people. During the reference period, the number of unemployed person employed in social companies rose from 11 people at the beginning of 2001 to 169 people at the end of 2003.

797187 LVL was spent on MSGP during 2003. During the year, 1199 unemployed persons were engaged in such measures, of whom 293 were long-term unemployed persons, 292 were young people aged from 18 to 25 years, 755 were disabled people, 2 were persons released from imprisonment, 211 were unemployed persons of pre-retirement age and 42 were persons re-entering the labour market following maternity leave.

Within the parameters of professional orientation, inhabitants receive consultations in regard to the selection of an optimal career direction and choice of profession, in issues related to professional suitability, in psychological issues related to job seeking and informative consultations regarding academic institutions or information regarding individual professions. Compared to the year before, during 2003 the total number of people who received consultations in issues related to a choice of profession increased by 19% reaching a figure of 36,406. Of these 25587 were

students from senior classes, 4410 were unemployed persons, 952 were students at vocational training institutions, 455 were students at higher education institutions, 1276 were unemployed job seekers who had not registered with the SEA, 2258 were employees and 1468 were the parents of school children.

The survey conducted by the LU Institute of Philosophy and Sociology revealed that the level of knowledge regarding various active employment services varies between various groups of unemployed persons. Best informed are women with small children who utilise training, re-qualification and qualification improvement services provided for unemployed persons most actively.

4.3. Labour remuneration

4.3.1. Minimum labour salary determined nationally

The regulation of labour remuneration and minimum labour salaries in Latvia is prescribed in several regulatory enactments. Clause 107 of the Constitution of the Republic of Latvia provides for the right for any person to receive an appropriate payment for work performed that is not less than the State determined minimum. In accordance with Clause 61 of the Labour Law, the minimum labour salary is prescribed by the Cabinet of Ministers. International regulatory enactment also provide for the regulation of a minimum employment salary.

In addition to the regulation of the national minimum labour salary, regulation also exists in regard to the local minimum labour salary, that is, social partners (organisations representing employers and organisations representing employees) determine the minimum labour salary within the company or sector within joint labour agreements applicable within the company or sector. Observing the principle of labour

Year

Average minimum

labour salary,LVL

Average monthly gross labour

salary of those employed,

LVL

Minimum labour salary % average

monthly gross labour salary of those

employed

Minimum labour salary % average monthly

gross labour salary of those employed for the

previous year

1999 50,00 140,99 35,5 37,52000 50,00 149,53 33,4 35,52001 55,00 159,30 34,5 36,82002 60,00 172,78 34,7 37,72003 70,00 192,49 36,4 40,5

Minimum labour salary and labour remuneration

51

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Labour

52

rights, whereby, the terms and conditions of a joint agreement may not have a detrimental impact on the condition of an employee in comparison with regulatory enactments, joint agreements may only provide for a higher minimum labour salary.

During the reference period, the minimum labour salary was raised twice: to 55 LVL in 2002 and up to 60 LVL during 2003 (see Table 4.2. in page 51).

During 2003, the increase in the minimum labour salary mainly occurred due to political will and the means available from the State budget, on which the increase in minimum labour salary of employees employed by institutions funded from the state budget depends. A failure to forecast increases in minimum labour salary and the impact thereof on the economic development of the State has resulted in a situation, whereby, the increases in minimum labour salary have fallen behind increases in the consumer price index for several years running.

The increase in the amount of the minimum labour salary has a positive effect on the macroeconomic situation in the country as a whole, because the relative labour salary fund increases and accordingly so do revenues from taxation on residents and social insurance contributions. So, for example, during 2003, following the increase in the minimum labour salary, for three months tax revenues were 9.65%

higher than during the corresponding three months from the previous year. Moreover, the increase in the minimum labour salary improves competitiveness for those undertakings (companies), which pay taxes from their entire labour salary, compared to those who pay taxes on the minimum labour salary and distribute the remaining salary in „envelopes”.

During 2002, several labour market surveys were carried out in Latvia such as, for example, “Working life barometer”. Its results indicated that a fixed monthly salary system is the most widely used in the three Baltic States, even though only just over half of Latvian and Lithuanian and less than half of Estonian respondents have signed up to this traditional agreement regarding the method for salary payment. Additional alternative agreements regarding salary are also quite frequently encountered. Among the Baltic States, illegal work is most widely prevalent in Latvia. In Latvia, more than a fifth of people in work receive their salary “in an envelope”. Moreover, there has been an increase in the number of those receiving their salary “in an envelope” on a monthly basis (see Picture 4.4.).

In line with the various surveys, it is possible to conclude that illegal employment is also caused by such factors as high taxation rates (social insurance contributions, residents’ income tax, company income tax), a complicated taxation system, as well

Source: data of survey “Working life barometer”, 2002

Illegal incomes (salaries “in envelopes”) in 1998 and 2002

Picture 4.4.

as the fact that these change frequently and the existence of complicated customs procedures and high customs payments. In line the survey carried out by the World Bank in 2002 regarding the impact of administrative procedures on the environment for entrepreneurial activity, entrepreneurs believe that tax rates, unforeseen changes in legislation and in Cabinet of Ministers regulations are the most important obstacles to entrepreneurial activity in Latvia along with the administration and legislation related to taxation. As a result of low incomes (low labour salaries), a part of employees voluntarily choose to their along with their taxes “in an envelope”. Accordingly, it is possible to conclude that the level of knowledge possessed by the public regarding the consequences of the non-payment of taxation on society as a whole is unsatisfactory.

Taking the aforementioned information into account, a range of measures need to be implemented in order to reduce the payment of salaries “in envelopes”. The main task involved is the raising of the minimum labour salary and informing the public regarding the expenditure of taxation revenues, as well the improvement of tax collection. Accordingly, the issue regarding the determination of a minimum labour salary in Latvia needs to be brought to fruition, i.e., the Cabinet of Ministers must prescribe and systematically implement criteria for the determination of the minimum labour salary that would be geared towards that the increase of the minimum labour salary with the purpose on ensuring that employees enjoy adequate living conditions.

In 2002, in order to resolve the issue regarding the determination and review of the minimum labour salary, the Ministry of Welfare drafted the following concept: „Concept regarding minimum labour salary” (hereinafter – concept). The basic principles for the determination and review of the minimum labour salary are determined

in this document, that is, a system was established for the determination of minimum labour salary. The Concept provides for a seven year period of transition during which the minimum labour salary will be increased to 50 % of the gross monthly labour salary of an employed person during the previous year. The Concept was accepted at a Cabinet of Ministers meeting held on 27 May 2003. The basic principles for the determination and review of the minimum labour salary determined in the Concept have been worked into a regulatory enactment – Cabinet of Ministers, 22 July 2003, regulations no.413 “Procedures by which Minimum Monthly Labour Salary shall be Determined and Overseen”.

During 2003, compared to other European Union candidate countries and member states, except Bulgaria and Romania, Latvia had the lowest minimum labour salary, according to data from the EU statistics bureau “Eurostat”. In line with data from the Central Bureau of Statistics, in Latvia the minimum labour salary is the lowest of all three Baltic States. In February 2004, the minimum labour salary in Latvia was 119 euros (80 LVL), in Lithuania it was 130 euros (87,5 LVL) and in Estonia it was159 euros (107 LVL). By setting a goal – to set the minimum labour salary in the amount of 50% of the average gross monthly labour salary of an employed person during the previous year, the ampunt of the minimum labour salary will approach the norm determined in the European Social Charter’s Chapter 4: “Entitlement to a Just Salary” that in accordance with the recommendations of the Organisation for Economic Co-operation and Development provides that the minimum level of income for people in work must be 66% of the national income per capita or 68% of the average national salary.

In line with statistical data, the number of employees in October 2003, was remuneration was up to and at

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Number of those employed, whose average gross monthly salary is up toand the same amount as the minimum labour salary

Picture 4.5.

Source: data of Central Bureau of Statistics

Labour

54

the same amount as the minimum labour salary was 83,4 thousand people or those 13,6 % of employed population, including: 72,2 thousand people in the private sector and 11,2 thousand people in the public sector (see Picture 4.5. in page 53). Accordingly, the raising of the minimum labour salary ought to have an impact on those employees in the private sector, because labour force expenditures will rise. However, taking into account that those employed in the private sector receive illegal incomes, in practice labour force expenditures will not rise by so great an amount as the minimum labour salary. This means that the increase of the minimum labour salary will not be significantly affected by changes in the unemployment level.

According to a survey carried out by the “Dienas bizness” newspaper in March 2003 (a survey of 300 company managers and officials), the majority (38%) of entrepreneurs that have raised the salaries of their employees during 2003, admitted that they have not gone up by more than 5% and the majority attributed this to the increase in the minimum labour salary. Almost one third (31%) of respondents said that they had not increased the salaries of their employees.

4.3.2. Labour remuneration in the public and private sector

According to statistical data for 2003, compared to the previous year, the average gross monthly salary of those employed has risen by 11,4%, including by 10,9% in the private sector and by 12,0% in the public sector.

Over many years, a trend has been observed whereby any increase in labour remuneration in the private sector is lower than that in the public sectors (see Picture 4.6.). Taking inflation into account, the real incomes of employed population (actual labour remuneration index % for those employed compared to the previous year) have increased by 7,8 % during this period.

The average gross monthly labour salary in the public sector during 2003 was 224 LVL, whereas in the private sector it was 172 LVL. Within the private sector, a situation prevails, whereby, employers pay taxes from the minimum labour salary and distribute their remaining income to employees “in an envelope”. Accordingly, statistical data from the private sector does not officially reflect the current situation. A survey published by the Federation of European Employers at the start of 2004 regarding salaries in 46 European countries shows that the labour remuneration level for people working in Latvia is one of the lowest in Europe. It is also the lowest when compared to both the other Baltic States – Latvia occupies 38th position, Lithuania is in 36th position and Estonia is in 32nd position. However, the increase in labour remuneration during 2003 in Latvia was one of the largest among European countries.

In previous years, an important issue was that of the insolvency of undertakings and companies and the consequences arising from this. On a positive note, it should be noted that every year there is a fall in the volume of salaries not paid out. According to statistical data, the amount of salaries not paid out to those employed in the economy has fallen during the period from 2002 to 2003 by 0,1 million LVL and that

Distribution of employees % by monthly average gross salary amountin the public and private sector in October 2003

Picture 4.6.

Source: data of Central Bureau of Statistics

9 Cabinet of Ministers, 8 January 2002, regulations no.10 “Regulations regarding Work in which Employment of Children from the Age of 13 is permitted”; Cabinet of Ministers, 28 May 2002, regulations no.205 “Procedures for Issuing Permits for Employment of Children as Performers in Cultural, Artistic, Sporting and Advertising Activities, and Restrictions to be included in Permits”; Cabinet of Ministers, 28 May 2002, regulations no.206 “Regulations regarding Work in which Employment of Adolescents is prohibited and Exceptions when Employment in such Work is Permitted in Connection with Vocational Training of the Adolescent”;

in December 2003, it amounted to 1,79 million LVL, including 1,72 million LVL in the private sector. Since the Law “On Protection of Employees in case of the Insolvency of an Employer” has come into force from 1 January 2003, then in future the issue of the non-paid labour salaries will be regulated and a guarantee fund to satisfy the demands of workers will be set up.

During 2003, of all the transgressions uncovered by the State Labour Inspection (SLI) in the area of labour relations, the most frequent were transgressions in labour remuneration issues (non-payment for overtime labour, transgressions related to the regulations related to payment of labour performed during the working week outside working hours, tardy labour remuneration) and amounted to 20,4 % of all transgressions. This indicator was 1,8% higher than in 2002. During the reference period, the increased number of submissions from employees to the SLI testifies to increased activity on the part of employees in defending their social rights and guarantees. During 2002, 1262 submissions received regarding labour remuneration issues and 1754 such submissions were received during 2003. Besides which, there has been an increase in the recognition of the SLI thanks to its work with the press and other mass media channels.

4.4. Labour relations and social dialogue 4.4.1. Labour relations

The field of labour relation and social dialogue has evolved very rapidly and improved during recent years. New regulatory enactment have been developed that adopt the requirements of International Labour Organisations that Latvia is a member country of, conventions and those found in European Union directives. A lot of work has also been carried out informing and consulting the social partners – employers and employees. The social partners – the Association of Latvian Free Trade Unions and the Confederation of Latvian Employers have actively engaged in the work of the National triumvirate co-operation council.

During the reference period, the development of work on labour relations, particularly in the European Union determined the necessity to improve the legislative platform governing labour relations, including the Labour Law. During both 2002 and in 2003, work continued on working the requirements of directives into the Labour Law. Several regulations from the Cabinet of Ministers were worked out in order to regulate and safeguard the employment of young people, observing

the European Council’s Directive, dated 22 June 1994, 94/33/EP, regarding requirements for the labour protection of young people9. The regulations precisely list those activities, in which children may be employed, accordingly also offering relief to the professional activities of employers.

A survey was carried out during 2002, in order to find out what the situation was like in the country in regard to the observance of labour relations and the opinion of employers in this regard, “The Opinion of Employers regarding the Labour Law”. 69 Latvian companies were surveyed, of which almost half employ more than 51 employees, and the same number of companies whose number of employees ranges from 6 up to 50.

According to the data from the survey, half of employers believe that quality information was not provided regarding the purpose of the Labour Law and the changes that occur as a result of it. Those shortcomings which afflict many state administrative bodies in the area of public relations were precisely reflected, that is, a lack of a uniform information campaign. In future, particular attention ought to be paid to various informative measures to promote the level of public knowledge regarding the latest developments in the field of labour relations. Employers are most poorly informed about issues related to the organisation of remuneration, the cessation of labour relations and the organisation of leisure time.

According to information provided by the SLI, employers pay insufficient attention to the observance of the requirements of the Labour Law. 18,4% of transgressions that were ascertained during 2003 fall precisely in the area of labour relations. The main transgressions of the requirements prescribed by the regulatory enactments regulating labour relations are as follows:

• non-concluding of employment agreements with employees, incomplete or inaccurate formulation thereof – 31,4% of all transgressions in the area of labour relations;

• transgressions in labour remuneration issues (non-payment for overtime labour, transgressions related to the regulations related to payment of labour performed during the working week outside working hours, tardy labour remuneration) – 20,4% of all transgressions in the area of labour relations.

During 2002, 2227 submissions were reviewed regarding complaints about transgressions of the Labour Law and during 2003 – 2604 such submissions were received. The most relevant issues featuring in the submissions relate to compensation regarding the non-payment of annual paid vacation time, tardy payment of

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salaries, the non-performance of additional payments prescribed in the Law, as well as the termination of labour relations. More often than not, the transgressions are related to a lack of knowledge regarding the Labour Law.

4.4.2. Social dialogue

The tri-lateral social dialogue has a sufficiently long history in Latvia. In 1992, a Trilateral Consultative Council was established by an order of the Republic of Latvia’s Cabinet of Ministers as a mechanism that would ensure stability in society. Later this council was reborn as the National Trilateral Co-operation Council consisting of the Cabinet of Ministers, the Latvian Confederation of Employers and representatives of the Association of Latvian Free Trade Unions. Thanks to the activity of the National Trilateral Co-operation Council, the tri-lateral social dialogue is sufficiently well developed.

At present, it is vital that the bi-lateral social dialogue should be developed at company level – to expand the knowledge of employers and employees regarding the concluding of joint employment agreements, the peaceful arbitration or solution of labour disputes, to increase the administrative and organisational potential of the parties involved and to improve the negotiation process. Therefore, in October 2002, the Ministry of Welfare commenced the PHARE Twinning project “Promotion of a bi-lateral social dialogue”. Particular attention was paid within this project to the development and improvement of bi-lateral social dialogue and the strengthening of the capacity of social partners. A home page: www.socialaisdialogs.lv has also been created in which information is collated both regarding the social dialogue in Latvia and the social dialogue in the European Union and globally. Upon registering with this home page, employers and employees can insert information regarding their companies and joint agreements they have entered into etc.

Labour disputes occupy a particular place in contemporary society and are an integral element within any labour relations system. Disputes in the field of labour relations affect both employees and employers, as well as organisations representing employees and employers. On 26 September 2002, the Saeima enacted the Law on Labour Disputes that came into force on 1 January 2003. The Law conforms to the general international principles regarding labour and social rights, as well as the relevant International Labour Organisation conventions and recommendations, as the requirements of the 1969 European Social Charter. With the enactment of this Law, there is a slight change in the approach to labour disputes.

Within the Law, labour conflicts are divided into conflicts regarding individual rights, into conflicts regarding collective rights and conflicts regarding collective interests. During the reference period, an

institution of conciliation has been established for the resolution of conflicts regarding collective interests. The Law provides that conciliators may be public and private. Public conciliators are persons that are included on a list that is ratified every two years by the National Trilateral Co-operation Council. This list was ratified at a meeting that took place on 20 December 2002. The list included Government parties and representatives nominated by trade unions and employers. Within the parameters of Phare Twinning Latvian - German project “Promotion of a Bi-lateral Social Dialogue”, special attention was paid to the review of industrial conflicts training of public conciliators that took place in the Autumn of 2003. This training was managed by representatives of the United Kingdom’s Advisory, Conciliation and Arbitration Service (ACAS). A handbook for conciliators was developed within the parameters of the project.

4.5. Labour protection In recent years, the improvement of the labour

protection system has been taking place rapidly, with the formulation of new regulatory enactments that conform to European Union requirements, by performing public (employer and employee) information measures, bringing about an improvement in the work of the SLI, as well by improving tri-lateral co-operation with social partners and co-operating with foreign experts within the parameters of various projects.

From 1 January 2002, the Law on Labour protection and Cabinet of Ministers, 23 August 2001, regulations no.379 “Procedures for the Performance of the Internal Supervision of the Work Environment” came into force. These two regulatory enactments prescribe the basic principles for labour protection and the work thereof. Therefore the information thereof in practice has been set out as a priority on the part of the Government. From the day that these labour protection regulatory enactments came into force, active work has taken place regarding the implementation thereof, explaining legislative requirements (seminars, lectures), publishing free explanatory materials and organising control and information campaigns.

In order to ensure the conformity of national legislative norms to EU requirements, work continued during 2002 and 2003 on the adoption of EU legislation and by the end of 2003, in practice all EU directives and the requirements thereof had actually been adopted in Latvian legislation. Over a period of two years, a total of 18 Cabinet of Ministers regulations were enacted that were formulated, based on Law on Labour Protection of 20 June 2001 and which adopt the requirements of EU directives in the area of labour protection. These regulation like all labour protection legislation as a whole will promote the establishment of safe working environments within companies that are harmless to

10 Cabinet of Ministers, 19 March 2002, regulations no.125 “Labour Protection Requirements in the Workplace”, Cabinet of Ministers, 9 July 2002, regulations no.293 “Procedures for Investigation and Registration of Accidents at Work”, Cabinet of Ministers, 6 August 2002, regulations no.343 “Labour Protection Requirements, when Working with a Display Screen”, Cabinet of Ministers, 6 August 2002, regulations no.344 “Labour Protection Requirements, when Moving Heavy Loads”, Cabinet of Ministers, 20 August 2002, regulations no.372 “Labour Protection Requirements When Using Personal Protective Equipment”, Cabinet of Ministers, 20 August 2002, regulations no.373 “Labour Protection Requirements in Work with Asbestos”, Cabinet of Ministers, 3 September 2002, regulations no.400 “Labour Protection Requirements When Using Safety Signs”, Cabinet of Ministers, 3 September 2002, regulations no.399 “Labour Protection Requirements When Coming into Contact with Chemical Substances in the Workplace”, Cabinet of Ministers, 9 December 2002, regulations no.526 “Labour Protection Requirements when using Work Equipment and Working at a Height”, Cabinet of Ministers, 25 February 2003, regulations no.92 “Labour Protection Requirements, when Performing Construction Work”;11 Council Directive 92/91/EEC of 3 November 1992 concerning the minimum requirements for improving the safety and health protection of workers in the mineral-extracting industries through drilling; Council Directive 92/104/EEC of 3 December 1992 on the minimum requirements for improving the safety and health protection of workers in surface and underground mineral-extracting industries;12 Council Directive of 2000/54/EC of 18 September2000 on the protection of workers from risks related to exposure to biological agents at work;13 Council Directive 86/188/EEC of 12 May 1986 on protection of employees against Risk Created By Noise in the Work Environment, 2003/10/EC on minimum requirements concerning labour safety and health protection against physical risk factors (noise);14 Council Directive 1999/92/EC of 16 December 1999 on minimum requirements for improving the safety and health protection of workers potentially at risk from explosive atmospheres;15 Council Directive 93/103/EC of 23 November 1993 concerning the minimum safety and health requirements for work on board fishing vessels, Council Directive 92/29/EC of 31 March 1992 the minimum safety and health protection requirements for improving medical assistance on ships.

human health.Ten Cabinet of Ministers regulations10 that were

enacted during the reference period replace existing regulations. They have been revised and published anew with the goal of the ensuring their conformity to the requirements of the Law on Labour Protection.

During the reference period, eight Cabinet of Ministers regulations have been adopted regarding labour protection issues that were not previously regulated by specific regulatory enactments. Accordingly, Cabinet of Ministers, 25 June 2002, regulations no.253 “Labour Protection Requirements for Investigation and Extraction of Mineral Resources” prescribe the labour protection requirements for the geological investigation, research and acquisition of mineral resources and in the extraction of mineral resources above and below ground, by drilling for such. These regulations have been formulated in accordance with the requirements of two EU directives11.

Every year, several employees are discovered to have contracted occupational diseases, which are caused by biological substances and, moreover, in recent years the number of such occupational substances has continued to grow. Cabinet of Ministers, 21 May 2002, regulations no.189 “Labour Protection Requirements when coming into Contact with Biological Substances” were formulated with the purpose of offering more labour protection to those employees that come into contact with biological substances at work. These regulations adopt the requirements of the relevant EU directive12.

The Law on Labour Protection prescribes that in a company or structural unit in which five or more people are employed, these employees or their representative, shall, taking into account the number of employees, the nature of the company’s operations and the risk posed by their working environment, select one or more trusted persons that represent the interests of the employees in matters pertaining to labour protection. In order to regulate the procedures for the selection and activity of these trusted persons, Cabinet of Ministers, 17 September 2002, regulations no.427 “Procedures

for the Election of Trusted Representatives and the Activities Thereof” were enacted.

On 17 June 2003, the Cabinet of Ministers enacted regulations no.323 “Regulations Regarding Training in Labour Protection Matters” that prescribe the working procedures for training labour protection specialists, trusted persons and the employed in labour protection. The introduction of these requirements will promote the entry of qualified specialists into the labour protection system and will increase the overall level of protection regarding labour protection matters.

To ensure the protection of employees against harm to their health that could arise from noise in the working environment, on 4 February 2003, the Cabinet of Ministers enacted regulations no.66 “Labour Protection Requirements for the Protection of Employees Against the Risk Created By Noise in the Work Environment”. These regulations adopt the requirements of EU directives13 and prescribe the procedures for the assessment of the risk caused by noise in the working environment, the permissible level of exposure to noise and other requirements.

Work in a potentially explosive environment is considered to be particularly hazardous, because explosions usually have serious consequences for the health or sometimes even life of employees. To prevent the occurrence of explosions and spreading thereof in companies, specific labour protection requirements must be observed that are prescribed in Cabinet of Ministers, regulations no.300, dated 10 June 2003, “Labour Protection Requirements for Work in a Potentially Explosive Atmosphere” that also adopt the requirements of the relevant EU directives14.

During 2003, the Ministry of Transport, adopting the requirements of EU directives15 has formulated and the Cabinet of Ministers has enacted two Cabinet of Ministers regulations that regulate labour protection requirements on ships – Cabinet of Ministers, regulations No.61, dated 4 February 2003, „Regulations regarding Safety and Health Protection Requirements for Work on Fishing Vessels” and Cabinet of Ministers regulations no.359,

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dated 1 July 2003, „Regulations regarding Safety and Health Protection Requirements and Medical Treatment On Board Vessels”.

The setting in order of labour protection legislation and the harmonisation thereof with the requirements of EU legislation is an important step, however, by itself it is not enough to ensure the successful operation of the labour protection system both at state and company level. It is important to achieve the introduction of this legislation and practical activity at company level. To facilitate the introduction of labour protection regulatory enactments and to promote understanding regarding such matters, the notification of employers and employees as well as that of society at large regarding labour protection issues is of particular importance.

A very important step in ensuring the flow of information and access to information regarding labour protection is considered to be the establishment at the contact point for the European Agency for Safety and Health at Work in Latvia and its internet home page (http://osha.lv) were established at the end of 2002, in which it is possible to learn more about labour protection legislation and also to find practical and explanatory information regarding issues related to labour protection. The activity of the Contact Point is ensured by the State Labour Inspection, whilst the flow of information is organised by the Information council, which is comprised of active representatives from the State Labour Inspection, the Ministry of Welfare, the Latvian Confederation of Employers, the Latvian Association of Free Trade Unions and the RSU Work and Environmental Health Institute. The purpose of the activity of the Information board is ensure an appropriate flow of information in Latvia that is in the public interest regarding European Union and Latvian labour strategies and health protection strategies for employees.

In October 2003 for the first time in Latvia, the European Agency for Safety and Health at Work’s Latvian national contact point organised a European week aimed at labour protection and health at work: „Hazardous substances – work carefully!” that is taking place simultaneously in EU member states and candidate countries. Its goal was promote the safety and health of those employees that come into contact with hazardous substances in the workplace. Various information materials were distributed as part of European Week, a conference was organised along with other informative activities including a best practice award competition in labour protection that was dedicated to work with hazardous substances. As a result of this competition, example of good practice were collected and an award was issued to the most successful company – Public JSC „Grindeks”, demonstrating opportunities how to eradicate risks caused by hazardous substances in the workplace to both employers and employees, by arranging the working environment in line with labour protection requirements.

Besides, the aforementioned contact point, the

State Social Insurance Agency operates as a permanent provider of information regarding labour protection that organises preventive measures funded from the special budget for social insurance against occupational accidents and occupational diseases, by publishing various explanatory materials (including reminders for employees) regarding various sectors and labour protection issues.

The greatest contribution in terms of contributing informative and educational material regarding labour protection was provided by the EU Phare Latvian – Spanish bi-lateral co-operation project „Support for the future harmonisation of legislation and strengthening of institutions in the field of labour protection and health” within the parameters of which: 24 guidelines, 16 brochures, 8 video films, 7 handbooks and other explanatory information materials regarding various issues related to labour protection were released during 2003. All these materials are accessible at the Internet home page of the European Agency for Safety and Health at Work in Latvia: (http://osha.lv). Special mention must be made regarding the handbook series regarding labour protection which is the first such sizeable educational material published in Latvian and Russian regarding labour protection issues and which will provide knowledge that is required for the improvement of the working environment, as well as for the training of labour protection specialists.

During 2003, a Latvian-Swedish co-operation project „Introduction of a work safety and health protection management system in Latvia” was implemented within the parameters of the international programme „Working life and expansion of the European Union” with the purpose to promoting the performance of internal supervision of the working environment in small and medium-sized companies. Within the parameters of the project, two information materials were created and published on this subject („Guidelines for assessing the risk posed by the working environment in small and medium-sized companies” and „Carry out internal supervision of your working environment!”) in addition to the implementation of an information campaign in timber processing and car service companies. The campaign’s results demonstrate that around 50% of timber processing and 62% of car service companies do not perform internal supervision of their work environment. However, taken as a whole companies showed a lot of interest in labour protection measures and received information from State Labour Inspectors. Therefore, it is likely that the situation in these companies regarding the area of labour protection could well improve. Following the successful realisation of this campaign, it was decided to also implement similar campaigns in other sectors in the future.

In order to ensure the successful implementation and practical operation of regulatory enactments, an effective control and supervision system is also necessary which is essentially provided for by the State

Source: data of State Labour Inspection

Picture 4.7.

Labour Inspection. Its successful operation is the pre-requisite regarding whether regulatory enactments will be observed. A lot of attention has been focussed in recent times on the training of SLI inspectors. During 2002, several international projects were implemented within the parameters of which measures were organised for strengthening SLI administrative capacity and improving its operational effectiveness.

4.6. Occupational accidents and occupational diseases

4.6.1. Analysis of occupational accidents at work

The main task of the labour protection system is to ensure a safe work environment. The effectiveness and quality of labour protection policy are characterised by changes in number of occupational accidents and occupational diseases.

Compared to other years, the total number of accidents during the reference period has fallen slightly (1404 accidents in 2002; 1330 accidents during 2003). Bearing in mind that lately a trend has emerged pointing to a fall in the number of those employed, excepting minor fluctuations - the number of occupational accidents per 100000 employed persons has remained at a similar level (see Picture 4.7.). However, here it is worthwhile noting that these are only the officially announced or open occupational accidents, regarding which an act or opinion has been compiled. However, a majority of accidents are kept hidden. Employers breach legislation and do not notify the State Labour Inspection regarding accidents that have taken place,

and employees do not report them subject to persuasion from the employer or because they fear for their jobs. Unfortunately, in such cases, these same workers are often the biggest sufferers, particularly in cases labour relations have not been formulated properly. Therefore, it is difficult to compare the total number of accidents with the relevant indicators in other EU member countries. In order to combat concealment of occupational accidents, during 2004 changes were enacted to the Code of Administrative Transgressions that provides for the specific responsibility of the employer and bigger penalties regarding the non-investigation or concealment of such accidents.

Good news comes in the form of the trend whereby there has been a decline in the number of lethal accidents: 56 during 2002 and 39 during 2003 (see Picture 4.8. in page 60). Irrespective of the significant reduction in the number of lethal occupational accidents during 2003, Latvia’s indicator: 4,3 lethal accidents per 100000 employed still lags behinds the EU-15 state average indicator – 3,4 lethal occupational accidents per 100000 employees.

In contrast, the number of people severely injured in occupational accidents has risen (206 in 2002; 217 in 2003) which could essentially be explained by the changes in the classification of health problems, which is prescribed by the Cabinet of Ministers, 9 July 2002, regulations no.293 “Procedures for Investigation and Registration of Accidents at Work” that came into force on 31 July 2002.

Analysing the number of victims of occupational accidents per 100000 employed divided across Latvia’s regions, one may conclude that during the last two years, the greatest number of victims have been in Riga and the district of Jēkabpils and the least in the districts of Preiļi and Ogre.

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During the reference period, the most occupational accidents were registered in the following sectors:

• timber, wood and cork products manufacturing (during 2002 – 215; during 2003 – 210);

• in construction (during 2002 – 130; during 2003 – 146);

• food product and drinks production (during 2002– 107; during 2003 - 129);

• dry land transport and mains transport sector (during 2002 – 96; during 2003 - 86);

• health and social care (during 2002 – 60; during 2003 – 83);

• forestry, timber products preparation and services related thereof (during 2002 – 134; during 2003 – 49).

The rapid reduction in the number of occupational accidents during 2003 in the forestry and timber products sector could be explained not by an improvement in the labour protection situation in this sector, but rather by the incomplete arrangement of working relations between employers and employees – many employees work as self-employed person and thereof accidents they have suffered are not included in this statistical data.

The harmful factors most often encountered each year are essentially one and the same – the impact of moving objects, including the operation of means of transport, contact with stationary objects, including falling from a height and slipping, as well as contact with sharp objects, pressure injuries etc.

The main causes of accidents are still unsafe action on the part of employees (during 2002 – 999; during 2003 - 933), as well as shortcomings in work organisation (during 2002 – 250; during 2003 - 176). During 2003, both referred to groups of causes have caused occupational accidents less frequently than during 2002. This may indicate that both employers and employees are beginning to pay increasing attention to

work safety issues. However, it must be admitted that these indicators have remained at a comparatively high level. This only goes to show once again the necessity to pay heightened attention to measures aimed informing the public (both employers and employees) about labour protection issues. Employers themselves must pay more attention to the training and education of their employees in issues related to labour protection, explaining the importance of preventive measures, the necessity for the use of individual means of protection, as well as training and instructing employees in safe work performance methods.

In analysing the number of victims according to employment history, we may conclude that most often employees with a working record in the relevant job of up to one year (in 2002 – 460; in 2003 – 469) and those with a record ranging from one to three years (in 2002 – 434; in 2003 – 429) are the ones to suffer occupational accidents. The number of victims in the referred to groups makes up 64% of the total number of victims during 2002 and 68% in 2003. This shows that when starting work employees are not properly instructed and trained by companies beforehand and that they lack the necessary experience and skills. It should be added that there has been no significant change in these indicators in recent years.

In order to reduce the number of occupational accidents, the interest of the public must be stimulated regarding labour protection issues and problems. Employers and employees must be informed about occupational accidents and the causes thereof, regarding company policy and culture in regard to labour protection issues, because the reduction in the number of occupational accidents is mainly dependent on the attitudes of employers and employees in regard to guaranteeing a safe working environment and their desire to co-operate in the solution of this issue.

Picture 4.8.

Source: data of State Labour Inspection

4.6.2. Analysis of occupational diseases

563 first time cases of occupational disease were ascertained nationally during 2003. This is a 29% increase on 2002 (436 cases). It should be noted that the number of people suffering from occupational diseases in recent years contained to grow (see Picture 4.8.). The rapid growth in the number of people suffering from occupational diseases ought not to be related to the situation in the area of labour protection, but rather to harmful working conditions several years ago, because on average occupational diseases appear 10 – 40 years after they have actually been contracted. This is also confirmed by the fact that in recent years, the most occupational diseases are ascertained among employees whose employment history ranges from 21 to 35 years. It is possible to predict that the increase in the number of cases of people contracting occupational diseases many only be checked after the year 2010 with the proviso that labour protection requirements are observed.

In recent years, the largest group of occupational diseases is still that related to skeletal – muscular – conjunctive system illnesses: around 30% of the total number of occupational diseases ascertained. It should be noted that this figure has fallen in 2003. The main factors responsible for these occupational diseases are ergonomic risk factors posed by the working environment, excessive physical strain and an unfavourable micro-climate. Employers do not always send employees for compulsory health checks. Therefore, the diagnosis of these diseases is often belated. The second largest group of occupational diseases is poisoning and the consequences of other external activities which rose significantly during 2003. The next largest group is that of illnesses related to the nervous system and illnesses related to the respiratory system. It should be added that in 2003, there was a 42% increase in the number of illnesses contracted that were linked to the nervous system. This could be linked to increasing intensity of work and the increasing attention paid to psycho-social problems in the workplace.

In analysing occupational disease cases in sectors of economic activity, it is clear that as in previous years, the most victims of occupation disease fall within the following sectors:

• production processing (during 2002 - 31%, during 2003 - 34%);

• transport and communications (during 2002 - 24%, during 2003 - 22%);

• health and social care (during 2002 -15%, during 2003 - 16%),

• farming, forestry (during 2002 - 9%, during 2003 - 9%);

• construction (during 2002 - 8%, during 2003 – 4%).

The majority of occupational diseases are caused by a combined group of factors, because more often

than not various risk factors affect a single employee. The one-dimensional factors most often encountered include: excessive physical strain, physical, chemical and biological factors.

It must be acknowledged that the level of employee knowledge and understanding in regard to their rights has increased in recent years. Most often, people turn to the relevant institutions to receive the compensation for injury due to them as a result of an occupational disease and in order to achieve an improvement in the working environment at their place of work. This proves that employers will have to perform more preventive measures, in assessing an eradicating risk factors posed by the working environment that are hazardous to the health of employees and to work safety.

4.7. Performance assessment of tasks set by the Lisbon Strategy in the area of promotion of employment

We can speak of Latvian policy goals in the employment field only in the context of common EU goals. In 1995, signing the European Treaty in Luxemburg, Latvia undertook the liabilities of the EU member state in the field of employment. Latvia as the EU member state started to solve the employment problems in the context of common European requirements according to the European Employment strategy and guidelines. The European Employment strategy has a leading role in the implementation of Lisbon strategy regarding the goals of employment and labor market. Indicating a new stage in the implementation of the European Employment strategy, in 22.07.2003 the Council of the European Union accepted the new Employment guidelines in the time period from 2003 to 2005. The guidelines were elaborated in a close relation to the General guidelines of economy development, in order to provide a closer coordination between the policies of economic and social matters.

The Council of the EU in Stockholm, supporting the employment goals proposed in Lisbon for year 2010: the total employment level – 70%, for women – 60%, defined also the interim goals for year 2005: the total employment level – 67%, for women – 57%. Besides the Council added to the goals of 2010 the employment level of 50% for the age group between 55-64.

The employment level in 2003, among the 15-64 year age group was 61,8% (in 2002 – 60,5%), which, even though it lags behind the EU average indicator nevertheless is representative of a positive trend. The employment level for women during 2003 was 57,9% which exceeded EU average indicators (EU-15 employment level in 2003 – 56%). The employment level for women in Latvia has already exceed the average timeline goals set in Stockholm for 2005, which, moreover is representative of a growing trend in recent

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times.Irrespective of the comparatively low retirement age

determined, the employment level for the 55-64 year age group in Latvia during 2003 was comparatively high: – 44,1% (ES-15 average – 41,7%). Bearing in the planned increase in the retirement age to 62 years for both men and women and the fact that the opportunity to take early retirement will no longer be available from 1 July 2005, as well as the range of active employment measures, the continued improvement of indicators could also be planned. However, a lot of serious work remains to achieve 50% employment goal set in Stockholm for the referred to age group by 2010.

Lately in the EU a significant slowdown of economical development has negatively affected the situation in labor market, thus it has significantly endangered the achievement of Lisbon goals. Taking into account the complicated situation, the European Council in March of 2003 proposed the Commission to establish the European Employment ad hoc group, in order to analyze the situation and to identify effective practical reforms, to improve the implementation of Employment strategy in a due time and on considerable level.

The established ad hoc group identified four main work direction in its report of 2003, which in the mentioned situation would provide the increase of employment and productivity:

• the increase of labour force and adaptation skills of labour force and enterprise;

• involving more people in labor market (activation of economically inactive human resources), making work a real chance for everybody;

• more and more effective investments in human capital;

• effective management in the provision of reform implementation.

Approving the high economical development and the increase of employment level during the last years in Latvia, simultaneously there were identified shortages and the most urgent directions to improve the labor market situation in the state. Some of them are indicated here:

• re-structuring processes of economy, the essential role of social partners;

• creation of new work places, the necessity of service development, especially in economically underdeveloped regions;

• activities to decrease the declared employment level (minimal wages, the impact of tax and benefit system to the solution of this problem) ;

• development of active and preventative policy, paying a special attention to such measures as assistance in work searching, facilitation of entrepreneurship, geographical mobility and accessibility of training;

• the modernization of State Employment Agency (SEA) and its provided services;

• the integration of young people and persons with low educational and skill level in the labor market:

the decrease of high number of persons who terminate their studies, provision of training accessibility, especially for persons with a low educational and skill level;

• lack of knowledge of national language – a risk factor in the labor market;

• existing discrepancy of education and skills to the requirements of the labor market – a serious problem, the solution of which is directly connected with the life long learning principle and the implementation of system.

4.8. Summary

Achievements• differences between the unemployment

level registered in the State Employment Agency and the unemployment level calculated according the International Labour Organization have been decreased;

• the number of job seekers and the unemployed persons involved in active employment policy measures has increased;

• activities for particular groups of persons have gained big support both among the employers and the unemployed persons and they can effectively improve the situation of the unemployed persons;

• during the reference period the amount of minimal labour salary is increased;

• the increase of wages for the employed persons is one of the higher among the EU member states and candidate states;

• the employed persons more and more actively get involved in the defense of their rights and social guaranties;

• the labour legislation regulating the employment of children, teenagers and young people is improved;

• the Law on Labour Disputes has been passed, foreseeing the labour dispute solution institutions and procedural order;

• the field of labour protection in the Latvian legislation is accorded with the requirements and principles of the EU;

• the web site of the European Labour Security and Health Agency in Latvia is formed (http://osha.lv), where it is possible to get acquainted both with the legislation of labour protection and to find a practical and explanatory information about the matters of labour protection;

• several events are organized to inform and educate employers, employees and all society together about the dialogue of labour relations and social dialogue, as well as the matters of labour protection, besides there are published many informative materials regarding these questions.

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Problems• the unemployment level of young people and

person in pre-retirement age is preserved;• the increase of minimal labour salary still drop

back from the increase of the of consumption price index;

• approximately one fifth of the employed persons receive their salary in “envelope”;

• in enterprises (especially in small and medium) the requirements of labour protection included in normative acts are not sufficiently implemented, the supervision of work environment is not performed sufficiently, work legal relationship and the requirements of normative acts are not obeyed;

• employers and employees are rather poorly informed about the matters of labour relations and labour protection;

Solutions:• development of special activities in facilitation

of employment for young people and persons in pre-retirement age;

• to inform and to facilitate the interest of society about the matters of labour relations and labour protection.