Variety in Employment Relations Across the European Union

1. Introduction

Industrial relations in the European Union form a complex and multilayered field shaped by diverse historical trajectories, institutional architectures and socioeconomic environments. Although the EU promotes shared principles such as social dialogue, worker protection and coordinated employment policies, labour governance remains predominantly national, resulting in a plurality of institutional models—Nordic, Continental, Anglo-Saxon, Southern and Eastern hybrid. This diversity has significant implications for economic performance, social cohesion and the capacity of member states to adapt to globalisation, technological change and demographic pressures.

The study builds on the hypothesis that industrial relations in Europe cannot be explained through a single institutional pattern, but through differentiated national pathways shaped by political economies, social partnership traditions and evolving governance mechanisms. Current debates reveal diverging views regarding the prospects of convergence: while some scholars argue that EU-level coordination fosters gradual alignment, others emphasise persistent national path dependencies and institutional resilience.

This article addresses five questions concerning the defining features of the main European industrial relations models:

• To what extent do the main industrial relations models in the EU—Nordic, Continental, Anglo-Saxon, Southern and hybrid—exhibit distinct structural features and internal dynamics?
• To what degree do these national models demonstrate selective convergence under EU governance, and where do divergences persist?
• How have recent crises—economic, digital and pandemic—reshaped the mechanisms, institutions and adaptability of industrial relations across member states?
• What role do hybrid models, particularly in post-socialist countries and small island states, play in shaping the broader trajectory of European industrial relations?
• Which future directions of evolution emerge for industrial relations in the EU in the context of technological transformation, demographic change and the green transition?

In addressing these questions, the article analyses the defining features and internal dynamics of European industrial relations models, examines recent transformations in selected member states and evaluates the extent to which EU governance contributes to selective convergence. The main conclusion advanced is that diversity remains structurally embedded, yet functional alignment emerges in areas where EU principles interact with national institutional capacities.

2. Literature Review

The study of industrial relations in the European Union has generated an extensive body of literature that highlights the coexistence of multiple institutional models shaped by historical legacies, socio-economic structures and national governance traditions. Early comparative research established the foundational typologies that continue to inform contemporary analyses. The Nordic model, characterised by strong trade unions, coordinated collective bargaining and robust welfare states, has been widely documented as a paradigmatic example of institutional complementarity and social partnership (Andersen et al., 2014; Alestalo & Kuhnle, 1986). Scholars emphasise its capacity for balancing economic competitiveness with social equity, supported by high levels of trust and tripartite cooperation (Kildal & Kuhnle, 2006).

In contrast, the Continental model—prevalent in Germany, Austria, Belgium and France—has been described as a corporatist system grounded in sectoral bargaining, codetermination and a strong regulatory role of the state (Thelen, 2014). Research on German industrial relations highlights the institutionalised role of works councils, the stability of sectoral agreements and the dual system of worker representation (Streeck, 2009; Hassel, 2009; Schmidt, 2002). These features contribute to a structured and predictable environment for labour-management cooperation.

The Anglo-Saxon model, dominant in the United Kingdom and Ireland, is associated with decentralised bargaining, low union density and market-driven labour regulation. Scholars argue that liberalisation reforms have weakened collective institutions and shifted the balance of power toward employers (Baccaro & Howell, 2011; Hall & Soskice, 2001). The literature also notes the adversarial nature of industrial relations in these systems, where conflict resolution relies more heavily on legal mechanisms than on social dialogue (Freeman & Medoff, 1984; Gospel & Pendleton, 2004).

Southern European countries—such as Italy, Spain, Greece and Portugal—have been conceptualised as a distinct model marked by fragmented union structures, extensive legal regulation and inconsistent enforcement (Molina & Rhodes, 2007; Pérez & Matsaganis, 2018). Studies emphasise the coexistence of formal protections with weak institutional capacity, leading to variability in the application of collective agreements and higher levels of labour conflict (Regalia & Regini, 2018).

More recent scholarship has focused on hybrid models, particularly in post-socialist Central and Eastern Europe, where industrial relations systems combine elements inherited from state socialism with institutional reforms driven by EU accession. These systems are characterised by low union density, limited collective bargaining coverage and unstable tripartite structures (Meardi, 2013; Avdagic, 2011). Romania, Poland and Hungary exemplify this hybridisation, with scholars noting the persistence of informal practices, political influence over social dialogue and fragmented institutional arrangements (Trif, 2008; Dima, 2012).

Small island states such as Malta and Cyprus have also attracted scholarly attention due to their compact institutional structures and service-oriented economies. Research highlights their hybrid nature, combining elements of Southern and Continental models with strong state involvement and sector-specific bargaining (Baldacchino, 2003; Ioannou, 2021; European Commission, 2024). The European framework for social dialogue, as defined in Articles 154–155 of the Treaty on the Functioning of the European Union (European Union, 2008), establishes the institutional foundations through which workers’ and employers’ organizations can shape labour relations and influence policymaking across member states (Gheorghe, 2008).

Across these diverse systems, a central theme in the literature concerns the extent to which EU-level governance fosters convergence. While some scholars argue that European integration promotes coordination through directives, social dialogue and soft governance mechanisms (Marginson & Sisson, 2006), others emphasise the resilience of national institutional configurations and the persistence of divergence (Goetschy, 1999; Keller & Sörries, 1999). Recent analyses suggest that convergence is selective and uneven, shaped by domestic political economies and the adaptive capacity of national actors (Schulten & Müller, 2015; Degryse, 2016).

Overall, the literature underscores that industrial relations in the EU remain fundamentally pluralistic, with convergence occurring primarily at the level of principles rather than institutional structures. This diversity provides the analytical foundation for the present study, which seeks to synthesise existing research while examining recent developments and emerging trends across member states.

The comparative framework applies the distinctions identified in the literature review to the main European industrial relations models. Bargaining structures, institutional coordination and the role of social partners are examined through a common set of criteria, ensuring consistency between the theoretical discussion and the comparative analysis.

3. Materials and Methods

This study employs a qualitative comparative research design aimed at capturing the institutional diversity of employment relations systems across the European Union. The analysis is based on three categories of data: (1) academic literature representing canonical and contemporary scholarship on European industrial relations; (2) institutional and policy documents issued by the European Commission (European Commission, 2024), Eurofound (Eurofound, 2024a; Eurofound 2024b), the European Trade Union Institute (ETUI), and national labour ministries; and (3) country-specific reports and statistical indicators related to union density, collective bargaining coverage, labour market performance and recent policy developments, with particular attention to Romania, Poland, Hungary, Malta and Cyprus in 2024–2025. The selection of countries was based on three criteria: (1) representativeness of each institutional model within the EU; (2) availability of comparable data on collective bargaining, union density and labour market regulation; and (3) relevance for recent policy developments, particularly in the context of post-pandemic reforms and EU-driven labour governance. Romania, Poland, Hungary, Malta and Cyprus were included as illustrative cases of hybrid and small-state institutional configurations. The temporal scope of the analysis covers the period 2010–2025, allowing the study to capture both pre-crisis institutional dynamics and the transformations triggered by the economic crisis, digitalisation, and the COVID-19 pandemic. This timeframe ensures comparability across models and reflects the most recent developments in EU labour governance.

The methodological process followed three steps. First, dominant institutional models—Nordic, Continental, Anglo-Saxon, Southern and Eastern hybrid—were identified and systematised based on structural characteristics, governance mechanisms and historical trajectories. Second, a cross-model comparison was conducted using criteria such as bargaining level, union organisation, employer coordination, state intervention and the institutionalisation of social dialogue. The comparative procedure relied on five analytical criteria applied consistently across all models: (1) level of collective bargaining; (2) union organisation and representativeness; (3) employer coordination; (4) degree of state intervention; and (5) institutionalisation of social dialogue. These criteria were selected because they represent the core dimensions used in the comparative industrial relations literature.

Third, recent developments in selected member states were examined to assess whether EU-level governance fosters convergence or reinforces national divergence. No software, scripts or computational tools were used in the analysis.

Although the present study focuses on institutional models of industrial relations, it is worth noting that economic evaluation tools such as cost–benefit analysis (CBA) remain essential in assessing the broader impact of labour market policies and investment strategies. Horhotă, Nedelescu, Matei and Țole (2022) emphasise that “cost–benefit analysis facilitates the efficient use of company resources, providing multiple information on economic and financial activity”. While CBA is not a core instrument of industrial relations, its logic of evaluating economic and social value can complement policy assessment in areas where labour market reforms intersect with investment decisions. The methodological limitations of the study stem from its qualitative design, which does not incorporate quantitative modelling or longitudinal statistical testing. The analysis relies on secondary sources, which may reflect institutional biases or differences in reporting standards across countries. Nevertheless, triangulation across multiple data categories mitigates these limitations and ensures analytical robustness.

The study did not involve preregistration. Generative AI (Microsoft Copilot) was used exclusively to support conceptual structuring and refinement of the analytical design; no AI-generated data, graphics or automated analysis were employed. In accordance with the journal’s GenAI disclosure requirements, all AI assistance was limited strictly to linguistic refinement and conceptual organization, without contributing empirical content or computational outputs. The triangulation of multiple qualitative sources ensures analytical robustness and allows replication of the comparative procedure by following the same sequence of data collection and model classification.

4. Comparative Institutional Models of Industrial Relations in the European Union

4.1. Conceptual Foundations of Industrial Relations

By their very nature, industrial relations represent a complex and diverse conceptual field. Work—arguably the most important factor of production—is omnipresent and essential across all social and economic circumstances. The performance of work, as well as its valuation, constitutes both the objective and the essential negotiation between employees and employers, or between trade unions and employers’ associations. The core object of industrial relations is therefore work itself, performed and valued under the best possible competitive conditions and within the most adequate legislative framework.

The European Union embraces, as a general guiding philosophy, the principle of “unity through diversity.” This principle is equally reflected in the domain of work and labour relations. The EU is an economic and political space characterised by institutional pluralism and cultural diversity. Industrial relations, as an integral part of social policy, mirror this diversity through a variety of national models, union practices and collective bargaining mechanisms. Despite efforts toward harmonisation, the EU does not impose a single model; rather, it promotes convergence through shared principles and social dialogue (Marginson & Sisson, 2006).

Work and the legislative frameworks regulating it take highly diverse forms across EU member states. Since the early stages of European integration, national labour law systems have differed substantially and have been approached in distinct ways. The specialised literature identifies at least five dominant models of industrial relations within the EU:

• The Nordic (Scandinavian) model, present in Sweden, Denmark and Finland;
• The Continental (Central European) model, present in Germany, France, Belgium, Luxembourg, the Netherlands and Austria;
• The Anglo-Saxon model, present in the United Kingdom and Ireland;
• The Eastern European hybrid model, present in Slovenia, Czechia, Hungary, Poland, Estonia, Latvia, Lithuania, Romania, Bulgaria and Croatia;
• The Southern model, present in Italy, Spain, Portugal, Greece, Cyprus and Malta.

Table 1 provides a comparative overview of the main institutional models of industrial relations in the European Union, highlighting their structural characteristics, bargaining architectures and the role of the state in labour governance. The table synthesises the conceptual distinctions discussed in the literature and serves as a reference point for the subsequent analysis of convergence, divergence and institutional adaptability across member states. By mapping these models side-by-side, the study establishes a clear analytical foundation for examining how historical trajectories and governance traditions shape national labour systems within the broader EU framework.

4.2. The Nordic Model

The Nordic model of industrial relations developed in countries such as Sweden, Denmark, Norway and Finland. It is distinguished by high levels of unionisation, centralised collective bargaining and a strong culture of cooperation among social partners. These systems are characterised by stability and efficiency in managing labour conflicts (Andersen et al., 2014). The Nordic model is defined by tripartite cooperation, extensive collective bargaining and a robust welfare state, and is widely regarded as an example of equilibrium between economic efficiency and social equity (Einarsdottir, 2024). In the literature, the term “Scandinavian model” is sometimes used interchangeably, although geographically it refers only to Sweden, Norway and Denmark, whereas the “Nordic model” encompasses all Northern European countries.

The Nordic or Scandinavian model of industrial relations is defined by several essential features:

• Tripartite cooperation, meaning the active involvement of government, trade unions and employers’ organisations in shaping economic and social policies. This collaboration reduces labour conflicts to near zero and promotes economic stability.
• Centralised collective bargaining, whereby collective agreements are negotiated at national or sectoral level. This ensures fair wages and uniform, decent working conditions across sectors.
• Strong and representative trade unions: Nordic countries have high unionisation rates, and unions play an active role in protecting workers’ rights, acting as key actors in industrial relations and in negotiations with government and public institutions.
• An extensive welfare state, providing universal access to education, healthcare and social protection. These elements, essential for high-quality work performance, are financed through progressive taxation. The system reduces social inequalities and contributes to superior labour quality and overall institutional performance.
• Flexicurity, the combination of labour market flexibility and social security. Employers can adjust their workforce, while employees benefit from protection in case of dismissal. Flexicurity is a central conceptual pillar in medium- and long-term development strategies across EU member states.
• Regulated market economies: Although based on capitalism, Nordic states intervene actively to correct social and economic imbalances. These interventions are equitable and do not disrupt competitive dynamics. Nordic regulatory practices are often cited as examples of best practice in labour governance and labour valuation.

The Nordic model is frequently cited as a successful example of reconciling economic and social interests. It has demonstrated resilience during economic crises through adaptability and progressive reforms, offering a sustainable framework for long-term development (Alestalo & Kuhnle, 1986). Many researchers conclude that the Nordic model rests on solid normative foundations (Kildal & Kuhnle, 2006) and that Nordic states have shown remarkable capacity to adapt to crises and challenges (van Deth & Kuhnle, 1996), enabling them to adjust more easily and overcome difficulties over time.

Among all countries embracing the Nordic model, Sweden stands out as a key reference point. Swedish industrial relations are based on social partnership and a strong culture of consensus. Collective bargaining covers the majority of employees, and trade unions play an active role in shaping public policies (Andersen et al., 2014). For these reasons, the Swedish model is often regarded as a spearhead within the Nordic group, opening new opportunities in industrial relations and influencing neighbouring countries.

Overall, the Nordic model is grounded in consensus and cooperation, particularly between the public and private sectors. It represents a balanced approach between labour efficiency and equitable rewards, inspiring other countries to draw on its principles when reforming their own industrial relations systems.

4.3. The Continental Model

The Continental model of industrial relations is predominantly found in countries such as Germany, Austria, France, Belgium, Luxembourg and other Western European states. It is a model grounded in sectoral collective agreements, works councils and significant state involvement in labour market regulation. This institutional configuration promotes a balanced relationship between employers’ and employees’ interests (Thelen, 2014). The Continental model is further characterised by corporatist structures, strong legal regulation, sector-level collective bargaining and a culture of consensus among social partners.

The defining features of the Continental model include:

• Institutionalised corporatism: The state plays an active role in mediating relations between employers and employees, promoting social dialogue through tripartite bodies.
• Sectoral collective bargaining: Collective agreements are negotiated at the level of economic branches rather than solely at enterprise level, ensuring uniform working conditions across sectors.
• Dual representation of employees: In addition to trade unions, employees are represented through works councils (e.g., Betriebsrat in Germany), which hold consultative and decision-making rights within firms.
• Extensive legal codification: The rights and obligations of social partners are regulated through detailed legislation, including provisions on dismissals, working time and social protection.
• A culture of consensus: Labour conflicts are relatively rare, as social partners generally prefer negotiation and compromise.

The Continental model benefits from a long tradition and is widely recognised as a functional and high-performing system in which consensus and equity are central values. Germany, often considered the paradigmatic example of the Continental model, illustrates a well-balanced relationship between economic efficiency and social protection. Works councils and sectoral collective agreements contribute to the stability of industrial relations (Thelen, 2014). Additional defining characteristics of German industrial relations include:

• Works councils(Betriebsräte)** with co-determination rights in areas such as working time, leave, and vocational training;
• Sector-based trade unions, such as IG Metall in the metal industry, which negotiate collective agreements at branch level;
• Active state involvement through labour market policies and regulations concerning dual vocational training.

Germany’s industrial relations system is supported by a long-standing research tradition, extensively documented in comparative political economy and labour studies. Seminal contributions by Streeck (2009), Schmidt (2002) and Hassel (2009) provide robust empirical and theoretical foundations for understanding codetermination, sectoral bargaining and the institutional resilience of the German model. These authors demonstrate how Germany’s dual system of worker representation—combining works councils with sectoral unions—has shaped academic debates and policy reforms across Europe, reinforcing the country’s role as a reference point in Continental industrial relations research. Recent research also shows that the German model, despite its institutional robustness, has undergone significant transformations in the metalworking sector. A power resources analysis of employers’ associations such as BaymeVBM, SüdwestMetall and Metall.NRW demonstrates that globalization and declining union strength have weakened the regulatory role of sectoral collective agreements. This has encouraged employers to reassess the function of employers’ associations as sources of associational power, leading to the expansion of OT membership (non-bargaining members) and the emergence of modular sectoral agreements. These developments illustrate that even within the Continental model, internal pressures have prompted employers to partially exit traditional sectoral bargaining structures in order to prioritize firm-level flexibility (Syrovatka, 2025).

Italy represents a particular variant of the Continental model, displaying distinctive features compared to other countries in this group. Although Italian industrial relations broadly follow the Continental tradition, several differences make the Italian model unique. It is characterised by a pluralist and decentralised system, with significant trade union influence and institutional fragmentation reflecting Italy’s regional and sectoral diversity. Italian scholars have identified several defining traits of the Italian model (Regalia & Regini, 2018):

• Trade union pluralism: Italy has multiple major confederations (CGIL, CISL, UIL), each with different ideological orientations. This pluralism sometimes leads to competition among unions and difficulties in coordinating collective actions.
• Decentralised bargaining: Although national collective agreements (CCNL) exist, much of the actual bargaining occurs at enterprise or sector level, reflecting the structural diversity of the Italian economy.
• The role of the state: The Italian state is less interventionist than in Germany but remains active in labour market regulation and in promoting social dialogue through institutions such as CNEL (National Council for Economy and Labour).
• Regional fragmentation: Economic and social differences between the industrialised North and the more agrarian South significantly influence industrial relations, including unionisation rates and the application of collective agreements.
• Moderate conflictuality: Italy has a history of union mobilisation and strikes, but recent decades have seen a trend toward social concertation, especially during periods of economic crisis.

Italy’s industrial relations system includes several key institutions and mechanisms. National collective agreements (CCNL) establish minimum working conditions for each sector. CNEL serves as a consultative body bringing together representatives of trade unions, employers’ associations and civil society. The National Institute for Social Protection oversees pensions and social insurance (Carrieri, 2017).

The Dutch model of industrial relations is considered a hybrid within the Continental tradition. It resembles the Continental model but incorporates strong Nordic influences, without fitting perfectly into either category. The Dutch model is notable for its combination of social concertation, labour market flexibility and active involvement of social partners in shaping economic policies (Cox, 1998). It is often associated with the Wassenaar Agreement of 1982, which marked a structural shift in economic governance (Wilthagen, 2004).

The defining features of the Dutch model include (SER, 2025):

• Social concertation (the “polder model”): Tripartite dialogue between government, trade unions and employers’ organisations is essential. Major decisions on wages, taxation and social reforms are made through consensus rather than conflict.
• Flexibility combined with protection: The Dutch labour market is flexible yet offers strong social protection through insurance schemes and active labour market policies.
• Influential unions and employers’ organisations: Although unionisation rates are moderate, unions and employers’ associations are well-structured and actively involved in collective bargaining and governmental consultations.
• Sectoral and company-level collective agreements: Collective agreements cover most employees, with negotiations taking place at both sector and firm level.
• Institutions of social dialogue, such as the Social and Economic Council (SER), which brings together representatives of social partners and government to formulate economic and social policies.

The Dutch model is considered distinctive for several reasons. The Wassenaar Agreement represents a historic compromise between unions and employers, involving wage moderation in exchange for reduced working time and job creation. It exemplifies consensus-based economic governance and has inspired reforms in Central and Eastern Europe. Over time, the Netherlands has maintained an open and competitive economy without sacrificing social protection or industrial relations stability, demonstrating a balance between competitiveness and social cohesion. The model’s exportability has made it a reference point for labour market reforms in post-socialist countries.

Arguments supporting the proximity of the Dutch model to the Continental tradition include:

• Sectoral collective bargaining, similar to Germany and Austria;
• The state’s role as mediator, facilitating social dialogue without directly intervening in wage negotiations;
• Institutions of concertation, such as SER, comparable to economic councils in Continental systems.

Nordic influences are visible in the Dutch model through its culture of consensus and extensive social protection. Tripartite dialogue and conflict avoidance resemble Nordic practices, while generous insurance and social policies echo the welfare state tradition.

4.4. The Anglo-Saxon Model

The Anglo-Saxon model of industrial relations is found primarily in the United Kingdom, Ireland and, outside Europe, in countries such as Canada, the United States, Australia, New Zealand and other Commonwealth states (Freeman & Medoff, 1984). It is characterised by decentralised industrial relations, reduced trade union influence and company-level bargaining. Economic liberalism and labour market flexibility are defining features of the Anglo-Saxon model (Baccaro & Howell, 2011). Minimal state intervention, declining unionisation and decentralised collective bargaining make this model distinctive and effective within capitalist economies (Hall & Soskice, 2001).

The specialised literature (Gospel & Pendleton, 2004) identifies several defining features of the Anglo-Saxon model of industrial relations:

• Unregulated labour market: Regulations concerning hiring, dismissal and working conditions are minimal. Employers have broad autonomy in managing human resources.
• Decentralised collective bargaining: Collective agreements are negotiated at enterprise level rather than sectoral or national level. Coverage through collective agreements is low.
• Low and fragmented unionisation: Unionisation rates are declining, and unions have limited influence on public policy. In the United States, unions are concentrated in specific industries (e.g., transport, education).
• Minimal state intervention: The state does not play an active role in mediating industrial relations. Social policies are market-oriented, emphasising individual responsibility.
• A culture of conflict and competition: Industrial relations are often adversarial, and dispute resolution mechanisms are legal rather than consensual.

The Dutch model of industrial relations cannot be considered Anglo-Saxon because it does not feature an unregulated labour market, nor does it exhibit weak or symbolic trade unions. In the Anglo-Saxon model, unions and employers’ associations are fragmented and have limited institutional roles, whereas in the Dutch model they are structurally integrated and influential.

4.5. The Southern Model

The Southern model of industrial relations is observed in countries such as Spain, Italy, Greece and Portugal (Molina & Rhodes, 2007). It is characterised by a combination of strong state regulation, fragmented trade union structures, limited application of collective agreements and a more pronounced culture of conflict. The Southern model is widely recognised as a distinct configuration within Europe, with its own structural and cultural features (Perez & Matsaganis, 2018).

The main defining characteristics of the Southern model of industrial relations are outlined in the literature (Regalia & Regini, 2018):

• Extensive legal regulation but inconsistent enforcement: Labour legislation is detailed and protective, yet its implementation varies significantly across regions and sectors.
• Medium to low unionisation with ideological pluralism: Multiple trade union confederations exist (e.g., CCOO and UGT in Spain; CGIL, CISL and UIL in Italy), often with different political orientations, leading to fragmentation and competition.
• Sectoral collective bargaining with limited coverage: Collective agreements are negotiated at sector level but do not always cover all employees, particularly in SMEs or in the informal economy.
• The state as regulator rather than mediator: The state intervenes through legislation and inspections but does not actively facilitate social dialogue, unlike in the Nordic or Dutch models.
• High conflictuality and frequent union mobilisation: Strikes and protests occur more frequently than in other European models, reflecting persistent social and economic tensions.

In addition to the classical models of industrial relations discussed in this study, hybrid models also exist that do not fit neatly into the established typologies (Nordic, Continental, Anglo-Saxon). One particularly interesting hybrid model is found in small island states such as Malta and Cyprus. Their industrial relations systems reflect the specificities of small states: compact institutional structures, significant state influence and economies oriented toward services. Although both countries are EU members, they do not align perfectly with the classical models; instead, they exhibit hybrid characteristics (Ioannou 2021; European Commission, 2024).

4.6. Hybrid Models in Small Island States (Malta and Cyprus)

Beyond the classical industrial relations models discussed earlier, several hybrid configurations exist that do not fit neatly into the established typologies (Nordic, Continental, Anglo-Saxon). A particularly interesting hybrid model is found in small island states such as Malta and Cyprus. Their industrial relations systems reflect the specificities of small states: compact institutional structures, significant state influence and economies strongly oriented toward services. Although both countries are EU members, they do not align perfectly with the classical models; instead, they exhibit hybrid characteristics shaped by scale, administrative capacity and economic structure (Ioannou 2024; European Commission, 2024).

Malta

The defining features of Malta’s hybrid industrial relations model include (Baldacchino, 2003):

• Moderate unionisation: The main confederations are the General Workers’ Union (GWU) and Union Ħaddiema Magħqudin (UHM). Maltese unions are particularly active in the public sector and in strategic industries such as transport and tourism, which contribute substantially to national GDP.
• Decentralised collective bargaining: Collective agreements are negotiated at enterprise level, with direct government involvement in regulated sectors.
• A strong role for the state: The Maltese state plays an active role in labour market regulation through the Ministry of Labour and institutions such as the Industrial Tribunal.
• A service-oriented economy: Sectors such as finance, tourism and IT dominate the labour market, shaping industrial relations toward lower conflict levels and greater emphasis on flexibility.

Cyprus

Cyprus also exhibits a hybrid model of industrial relations, with several defining features (Ioannou, 2021; Ioannou, 2014):

• High unionisation in the public sector: Major confederations such as PEO (Progressive Workers’ Federation) and SEK (Cyprus Workers’ Confederation) hold significant influence in public administration and education.
• Formalised social dialogue: Institutionalised consultation mechanisms exist between government, trade unions and employers’ organisations, particularly in relation to fiscal and wage policies.
• Sectoral collective agreements: In sectors such as tourism, construction and transport, collective agreements are negotiated at branch level, although their application varies.
• A flexible economy with attractive fiscal policies: Cyprus attracts investors through favourable tax regimes, resulting in a dynamic labour market but also challenges in ensuring adequate worker protection.

Both Cyprus and Malta, as small island states in the Mediterranean, exhibit geographical particularities that influence their social and economic structures. Consequently, their industrial relations systems must adapt to these conditions and remain flexible, especially given that both countries are often perceived as fiscal havens. Their hybrid models thus reflect a combination of Continental, Southern and context-specific institutional features.

4.7. Hybrid Models in Post-Socialist Eastern Europe

In Eastern Europe, hybrid models of industrial relations combine elements inherited from the socialist period with Western institutional influences introduced after EU accession. Countries such as Poland, Hungary, Czechia, Slovakia and Romania display mixed structures, with significant variation among them. The most relevant configurations are those observed in Hungary, Poland and Romania.

Hybrid models of industrial relations in Eastern European states differ through four distinctive features:

• The socialist legacy
• The post-1990 transition
• Dual institutional structures
• Fragmentation and instability

The Socialist Legacy

During the socialist period, trade unions were integrated into the state apparatus, with a predominant role in labour protection but without genuine autonomy (Meardi, 2007). Liberalisation of the labour market, privatisation and EU influence introduced mechanisms of collective bargaining, social dialogue and trade union pluralism—representing a major institutional shift after the transition that began in the 1990s.

Post-1990 Transition

In Eastern European countries, dual structures coexist: formal institutions (tripartite councils, labour legislation) alongside informal practices (ad-hoc negotiations, political influence over trade unions) (Avdagic, 2011). Declining unionisation and limited collective bargaining coverage—especially in the private sector—reinforce fragmentation and instability in industrial relations models, affecting performance and institutional coherence.

Poland

Poland exhibits a hybrid model of industrial relations centred around historically significant trade unions such as Solidarność, which retains symbolic influence but competes with OPZZ and FZZ. Social dialogue is formalised through the Council for Social Dialogue (RDS), which brings together government, employers’ organisations and trade unions at the negotiation table.

Collective bargaining is decentralised, with agreements negotiated at enterprise level and limited coverage—one of the defining features of Poland’s hybrid model.

Hungary

Hungary displays a hybrid model marked by strong political intervention. Unionisation is below 10%, a consequence of governmental influence over industrial relations. Labour policies are centralised, and social dialogue is often formal, with limited impact, reflecting significant governmental control over the Hungarian model.

Collective agreements can be negotiated, but their application is fragmented—an uncommon characteristic among EU member states.

4.8. Romania as a Transitional Hybrid Model

Industrial relations in Romania are shaped by post-communist transition, declining unionisation and fragmented collective bargaining. Labour legislation has been influenced by EU directives, but implementation varies (Dima, 2012). Romania can be classified as a transitional hybrid model. The historical evolution of industrial relations in Romania provides an additional layer of context for understanding contemporary institutional diversity within the EU. Ghena (2026b) offers a conceptual and historical reinterpretation of industrial relations in Romania, highlighting how the field was marginalized during the communist period and re-emerged after 1990 as a key mechanism for balancing the interests of employers and employees. The author emphasises that “industrial relations represent an essential element for the balanced functioning of the labour market, acting as an intermediary between the interests of employers and employees”. This national perspective complements the broader comparative models discussed in this study, illustrating how post-socialist legacies continue to shape hybrid institutional configurations.

The main features of Romania’s transitional hybrid model (Trif, 2018; Trif, 2016) include:

• Pluralist trade unions: Romania has several representative confederations—CNSLR-Frăția, Cartel Alfa, BNS, CSDR—with influence varying by sector and region.
• The National Tripartite Council: This body functions as a consultation platform between government, employers and trade unions, but its effectiveness varies due to political instability and lack of institutional continuity.
• Sectoral collective bargaining reintroduced through the Social Dialogue Act (2022), though implementation remains limited. Most collective agreements are still negotiated at enterprise level.
• Declining unionisation: Unionisation rates are below 20%, with higher concentration in the public sector (education, healthcare, transport) and weak presence in the private sector.
• Moderate conflictuality: Strikes and protests occur but rarely lead to structural change. Mediation and conciliation mechanisms exist but are underutilised.
• The role of the state: The state acts as a regulator but is perceived as weak in enforcing labour legislation, particularly regarding labour inspection and collective agreement compliance.

Romania’s industrial relations model is therefore hybrid and transitional, influenced by the socialist legacy, post-EU accession reforms and recent efforts to strengthen social dialogue and collective bargaining. In 2025, a trend toward reindustrialisation and institutional reconfiguration became increasingly visible. The evidence from Central and Eastern Europe shows that union revitalization is neither predetermined by strong power resources nor prevented by their erosion; instead, it emerges as a context-dependent process in which adverse conditions can constrain collective action, yet also stimulate unions to innovate, reorganize and reclaim influence (Trif et al., 2023).

Recent Developments in Romania (2024–2025)

Specialists have identified several trends emerging in Romanian industrial relations during 2024–2025:

• Strategic reindustrialisation: The government launched the National Plan for Major Industry (2024), with €2 billion in investments in manufacturing and local value chains.
• Decline in industrial output: In Q1 2025, industrial production decreased by 4.9%, and turnover by 8.2%, reflecting external pressures and reduced domestic demand.
• A well-qualified but underutilised workforce: Romania has a strong tradition in engineering and technical training, but migration and limited investment in research and development constrain the potential of its labour force.

These developments illustrate the dynamic nature of Romania’s industrial relations system, which continues to evolve under the combined influence of domestic reforms, EU governance and broader economic transformations. The Romanian case further illustrates how economic transformation interacts with institutional evolution in industrial relations. Pavelescu and Dumitru (2025) demonstrate that Romania’s economic growth between 2005 and 2022 was consistently higher than the EU average, driven by structural shifts toward the service economy. The authors emphasise that “the strengthening of the service economy in Romania is highlighted, along with the convergence of Romania with the European Union”. These findings complement the discussion on Eastern hybrid models, showing how economic convergence coexists with institutional fragmentation and uneven collective bargaining coverage.

4.9. Towards Selective Convergence in the European Union

Regardless of the industrial relations model adopted, the European Union exerts a continuous influence on national systems through legislation, policy coordination and soft governance mechanisms. The overarching question concerns the extent to which EU-level governance fosters convergence among member states. The analysis indicates that convergence occurs primarily at the level of principles—such as the promotion of social dialogue, minimum labour standards and worker protection—rather than at the level of institutional structures.

National systems remain deeply rooted in their historical and socioeconomic contexts, and EU directives tend to be adapted rather than uniformly implemented. This adaptive process reflects the institutional path-dependencies of member states and the flexibility of EU governance, which relies more on coordination and persuasion than on coercive harmonisation. Nevertheless, soft governance instruments such as the European Semester, cross-national policy learning and monitoring mechanisms contribute to gradual alignment in specific areas, particularly in collective bargaining frameworks and labour market reforms.

The comparative evidence suggests that institutional adaptability, rather than uniformity, is the key determinant of resilience in European industrial relations. Models that combine strong social partnership with flexible governance—such as the Nordic and Dutch systems—appear better equipped to manage contemporary challenges, including technological change, demographic shifts and economic volatility. Conversely, systems characterised by fragmentation, weak enforcement or political interference face greater difficulties in ensuring stability and equitable labour outcomes.

In this broader context, the EU’s influence is best understood as promoting selective convergence: alignment in certain policy domains, coexistence of diversity in institutional structures and continuous evolution driven by both national reforms and supranational coordination. Industrial relations in Europe thus remain pluralistic, dynamic and shaped by the interplay between national traditions and European integration.

5. Results

The comparative analysis of industrial relations systems across the European Union reveals a persistent and structurally embedded diversity that reflects distinct historical trajectories, institutional architectures and socioeconomic environments. The first major result concerns the internal coherence of the Nordic model, which continues to stand out as the most institutionally integrated system. High levels of union density coordinated collective bargaining and robust tripartite cooperation generate a stable framework capable of absorbing economic shocks and maintaining both competitiveness and social equity. These findings confirm earlier assessments emphasising the complementarities between welfare state institutions and labour market governance in Northern Europe.

The second key result highlights the structured corporatism of the Continental model, particularly in Germany and Austria, where sectoral bargaining and codetermination mechanisms ensure predictable labour–management relations. The analysis shows that these systems maintain a high degree of institutional resilience, even in the face of globalisation and technological change. However, variations within the model—such as the more fragmented Italian system—demonstrate that internal diversity persists even among countries traditionally grouped together.

The third result concerns the Anglo-Saxon model, which remains the most decentralised and market-driven. Low union density, enterprise-level bargaining and minimal state intervention continue to shape labour relations in the United Kingdom and Ireland. While this model offers flexibility and rapid adjustment to market conditions, it also exhibits weaker mechanisms of worker protection and lower collective bargaining coverage, reinforcing the adversarial nature of industrial relations.

The fourth result relates to the Southern European model, where the analysis identifies a structural tension between extensive legal regulation and inconsistent enforcement. Fragmented union structures, regional disparities and higher levels of conflictuality contribute to institutional instability. These findings align with previous research showing that Southern systems combine formal protections with weak administrative capacity, resulting in uneven application of collective agreements and frequent labour disputes.

The fifth result concerns the hybrid systems of Central and Eastern Europe, where the legacy of state socialism continues to shape institutional arrangements. Low union density, limited collective bargaining coverage, and politically influenced social dialogue remain defining features. Romania, Poland and Hungary exemplify this hybridisation, with Romania showing recent attempts to strengthen sectoral bargaining through legislative reforms. However, implementation remains uneven and institutional instability persists.

A sixth result emerges from the examination of small island states such as Malta and Cyprus. Their compact institutional structures, service-based economies and strong state involvement produce hybrid models combining elements of Continental and Southern systems. These countries demonstrate that scale and economic structure significantly influence the configuration of industrial relations.

Table 2 synthesises the governance and coordination mechanisms that differentiate the main European industrial relations models. By comparing union coordination, employer organisation, tripartite cooperation and institutional stability, the table highlights the structural contrasts that shape national labour systems. This comparative overview supports the discussion in the Results section by illustrating how institutional complementarities or weaknesses influence each model’s adaptability to economic pressures, technological change and EU-level governance. The table therefore provides an analytical bridge between the conceptual classification of models and the empirical assessment of convergence and divergence across member states.

From a broader perspective, these results support the study’s working hypotheses: that institutional diversity remains structurally embedded and that convergence under EU governance is selective rather than systemic. The implications of these findings highlight that institutional adaptability, rather than uniformity, is the key determinant of resilience in European industrial relations. Systems combining strong social partnership with flexible governance—such as the Nordic and Dutch models—appear better equipped to manage technological change, demographic pressures and economic volatility. Conversely, systems marked by fragmentation, weak enforcement or political interference face greater challenges in ensuring stability and equitable labour outcomes.

6. Discussions

Across all models, the overarching discussion concerns the extent to which EU-level governance fosters convergence. The findings suggest that convergence occurs primarily at the level of principles—such as the promotion of social dialogue, minimum labour standards and worker protection—rather than at the level of institutional structures. National systems remain deeply rooted in their historical and socioeconomic contexts, and EU directives tend to be adapted rather than uniformly implemented. Nevertheless, soft governance mechanisms, such as the European Semester and cross-national policy learning, contribute to gradual alignment in specific areas, particularly in collective bargaining frameworks and labour market reforms.

Recent analyses of labour market transformations in the EU-27 reinforce the argument that institutional diversity interacts with broader socioeconomic trends. Pavelescu, Cismaș and Dumitru (2024) show that EU labour markets are undergoing a period of heightened volatility, skill shortages and structural polarisation. As the authors note, “labour markets are in a transformative period due to increased uncertainty and overall volatility”, a dynamic particularly visible in Central and Eastern Europe. Their findings support the view that industrial relations systems must adapt to digitalisation, demographic pressures and new forms of employment, aligning with the cross-cutting trends identified in this study. Recent scholarship has begun to explore the intersection between industrial relations and sustainability frameworks, particularly the Sustainable Development Goals (SDGs). Ghena (2026a) argues that industrial relations mechanisms—especially social dialogue and collective bargaining—play a central role in advancing SDG 8 on decent work and economic growth. As the author notes, “strong industrial relations systems significantly support fair labor conditions, inclusive growth, and institutional resilience”. This perspective reinforces the idea that labour governance is not only an economic institution but also a driver of sustainable development, especially in the context of technological transformation and AI adoption.

The study’s limitations stem from its qualitative comparative design, which does not incorporate quantitative modelling that could measure convergence dynamics more precisely. Future research could integrate longitudinal indicators, analyse the impact of digitalisation and platform labour on emerging bargaining structures, and examine how reindustrialisation trends reshape institutional configurations across member states.

7. Conclusions

The analysis of industrial relations across the European Union demonstrates that institutional diversity remains a defining structural feature of the European social model. In response to the first research question, the study confirms the existence of five major models—Nordic, Continental, Anglo-Saxon, Southern and hybrid—each characterised by distinct historical legacies, governance traditions and mechanisms of collective bargaining. These models reflect the pluralism of democratic systems and the national specificities that shape labour market institutions.

Regarding the second research question, the findings show that convergence within the EU occurs primarily through functional alignment rather than institutional uniformity. While the EU promotes common principles such as social dialogue, worker protection and coordinated employment policies, member states implement these principles through nationally specific instruments. This pattern of selective convergence highlights the adaptability of national systems and the limits of supranational harmonisation. The persistence of structural divergence—particularly between Western and Eastern member states—continues to challenge social cohesion and the effectiveness of common policies.

In relation to the third research question, the study reveals that recent crises have profoundly influenced the evolution of industrial relations. The global economic crisis (2008–2013) triggered a phase of authoritarian recentralisation, reducing the autonomy of social partners and weakening collective bargaining structures. The digital era and the COVID-19 pandemic accelerated the emergence of platform work, telework and algorithmic management, requiring new regulatory frameworks and innovative forms of social protection. These transformations underscore the need for stronger enforcement mechanisms and more effective involvement of social partners in policymaking.

Addressing the fourth research question, the analysis highlights the growing relevance of hybrid models, particularly in post-socialist states and small island economies. These systems evolve through the interaction of domestic constraints and EU-level pressures, illustrating that industrial relations are not static but continuously reshaped by policy reforms, economic restructuring and the strategic behaviour of social actors. Romania’s recent developments—such as the reintroduction of sectoral bargaining and the emerging trend toward reindustrialisation—demonstrate that institutional renewal is possible even in contexts marked by historical discontinuities and structural weaknesses.

Finally, in response to the fifth research question, the study identifies several key directions for the future evolution of industrial relations in the EU. The transition to a green economy, accelerated digitalisation and demographic change will require flexible yet protective governance mechanisms. Strengthening social dialogue, improving the quality and coverage of collective bargaining, and investing in the capacity of social partners—especially in newer member states—will be essential for managing labour market transformations. The development of qualitative indicators of social convergence, alongside quantitative measures such as union density, will be necessary to capture the real impact of industrial relations on social cohesion.

Overall, the study suggests that the future of industrial relations in the European Union will depend less on the convergence of institutional forms and more on the ability of national systems to integrate flexibility with social protection, to reinforce the role of social dialogue and to ensure that labour market transformations support both economic competitiveness and social justice. Diversity thus remains not only a characteristic of European industrial relations, but also a potential source of resilience and innovation. The conclusions formulated here reflect both the current state of industrial relations and the structural and normative challenges that hinder deeper convergence, offering valuable insights for future public policies and institutional reforms.