Competitive Tendering and Employment Relations in Local Public Transport

The aim of the project is to map the expected results of competitive tendering on employment relations in local public transport in Norway. We find that because of national regulations and agreements certain aspects of employment relations are left unaffected. However, there are two effects of franchising on employment relations that are crucial to the employees. These are reduced employment protection and a more intensive use of the labour force. In this report, we suggest four ways of regulating employment relations when local public transport services are tendered: (1) To leave the regulation as it is today. (2) To add certain regulations to national law, such as giving all employees at the former company a period of trial at the new company. (3) To transfer bus drivers to the new company unless the new company has excessive labour force. Then the transferring company may dismiss the bus drivers. (4) To adopt employees’ rights in the events of transfer of undertakings in franchising processes. Such a regulation will include bus drivers as well as other workers related to the procurement. The winning company will have to carry out dismissals in a case of excessive labour force. Model two through four are meant to strengthen workers’ employment protection when the operation of local public transport is transferred from one company to another. They may, however, imply undesirable risks, thereby rising costs and distortion of competition.