Across Europe, collective bargaining remains a central pillar of the European Social Model – yet in the private service sectors, which now employ nearly three-quarters of the workforce, bargaining coverage continues to lag behind. While the EU has set an indicative threshold of 80% bargaining coverage under the Directive on Adequate Minimum Wages (AMW Directive), the private-service economy averages only 48%, leaving millions of workers without effective access to negotiations on wages and working conditions.
Commissioned research investigates why bargaining in private services remains weaker than in other sectors, what structural and institutional barriers keep coverage low, and outlines some ideas on what actions unions and policymakers can take to strengthen social dialogue. With the project now completed, the findings offer a comprehensive picture of where challenges lie and what must change to ensure private-service workers are fairly represented in Europe’s evolving labour market.
What we examined
The study assessed collective bargaining in private services through multiple lenses – workforce characteristics, trade-union capacity, employer organisation and regulatory frameworks. A mixed-methods approach combined:
- Statistical analysis of EU-wide datasets
- A literature review of academic and policy research
- Qualitative interviews with 20 sectoral and cross-sectoral trade union representatives
The research covered a diverse range of private-service subsectors, including commerce, ICT, finance, hospitality, transport and logistics, real estate, professional and administrative services, care, media and arts, and personal services.
Key insights
Workforce fragmentation weakens bargaining foundations. Private services are dominated by micro and small enterprises, mobile workforces, and a high share of non-standard employment. Younger workers, women and migrants are overrepresented in the private services, and high turnover limits collective identity. These conditions make union organising costly and difficult.
Trade unions face structural capacity constraints. With average membership density at just 13%, private-service unions operate under significant resource constraints and consequently rely heavily on volunteers in place of professional staff. Fragmentation across occupations and employers dilutes bargaining power, and the relative ‘newness’ of many private-service sectors means that established organisational traditions are still emerging; leadership structures often do not reflect the workforce’s diversity, strike funds remain weak, and dispersed workplaces make mobilisation difficult, all of which combine to limit unions’ leverage in negotiations.
Employer representation is uneven and often weak. Many employer associations lack a bargaining mandate, and complex business models, including outsourcing and franchising, blur accountability and multiply negotiation tables. Small firms often have little incentive or capacity to negotiate, while foreign-owned firms frequently centralise decision-making outside the country, further constraining local dialogue. Finally, some companies actively circumvent bargaining through delays, parallel structures, or employer-aligned ‘yellow unions’.
Regulatory systems do not reflect today’s service-based economy. High thresholds for establishing worker representation exclude most micro-enterprises. Large groups of self-employed, freelance and platform workers fall outside collective agreements due to misclassification or legal gaps. Enforcement of existing rules is weak, and voluntary guidelines often replace binding obligations, which further limit effective coverage.
Policy pointers for strengthening collective bargaining in private services
The study outlines a set of proposals that can help expand bargaining coverage and improve the functioning of social dialogue:
- Supporting unions in outreach, organising and training to strengthen their presence in fragmented workplaces
- Enhancing coordination between unions across subsectors and employer groups
- Improving employer representation and clarifying bargaining mandates
- Adjusting regulatory frameworks to include non-standard and platform workers and lower barriers to representation
- Ensuring enforcement mechanisms that give real effect to agreements in micro and small enterprises
- Promoting sectoral and multi-employer bargaining to overcome structural fragmentation
Why this matters
Europe’s collective bargaining systems were largely built for stable industrial workplaces – yet today, private services employ the majority of workers. Without adapting institutions to this reality, millions will remain outside effective social dialogue structures, undermining fair wage setting and decent working conditions. Strengthening sectoral and multi-employer bargaining in private services is essential not only for achieving the 80% coverage target of the AMW Directive, but also for advancing a fair, inclusive and competitive European labour market.
Learn more
You can access the full report and policy recommendations here.
If you have questions or would like to discuss the findings, feel free to get in touch!
