Unions sound warning about UK-backed plan to rebuild Ukraine

Lugano Declaration pushes for modernisation and investment, but critics say a just reconstruction is needed

UK-backed plans to rebuild Ukraine after the war are “absolutely worthless” and will do nothing to protect workers, labour chiefs in the country have warned after the plans were presented this week.

They say reconstruction plans for Ukraine should include a clear role for trade unions and provisions to improve conditions and train workers. Yet labour organisations were not represented at the national and international talks that saw the plans, signed by 40 states, drawn up.

The Lugano Declaration was presented at an international conference in Switzerland on Tuesday.

Signatories include the EU, UK and US. The document advocates a reconstruction, modernisation and investment programme for Ukraine, backed by western governments and banks.

Speaking at the event, Ukrainian prime minister Denys Shmyhal stated that short- and long-term reconstruction and recovery could cost up to $750bn, and laid out a western-backed roadmap for reform and recovery.

“No representatives from Ukrainian trade unions, nor our social partners from the employers’ side, were invited to help develop the reconstruction plan,” said Natalia Zemlyanska, head of Ukraine’s Union of Manufacturers and Entrepreneurs. “For us, this document is absolutely worthless.

“Why is this document only about money and mythical investors, and no words about the policies that will affect real people, Ukrainians, workers – the people who are going to restore the country?”

The Lugano declaration includes a set of principles that are to guide Ukraine’s reconstruction, including transparency, rule of law, public participation and sustainability.

That process, the declaration reads, “has to be inclusive and ensure gender equality and respect for human rights, including economic, social and cultural rights.”

The conference included a platform for Ukrainian civil society, but it included no labour organisations, according to a list of participants.

The International Labor Organization, a UN agency responsible for advancing workers’ rights and economic justice, said it was not invited to participate in an official capacity, although an ILO representative did attend the conference.

UK foreign secretary Liz Truss said that the reconstruction plan “needs to be a new Marshall Plan for Ukraine and it needs to be driven by Ukraine itself”.

“It’s absolutely imperative we get the Ukrainian economy going, we need to be able to support returning Ukrainians returning to Ukraine, we need to give people hope about the future,” Truss told conference participants.

openDemocracy has approached the Ukraine Recovery Conference and the Swiss Ministry of Foreign Affairs for comment.

A window of opportunity

Ukrainian trade unionists and labour experts are also concerned that the future outlines of international and state-led reconstruction may have already been set with drastic wartime labour deregulation efforts, and ongoing efforts to liberalise labour legislation prior to the Russian invasion in February this year.

George Sandul, a labour lawyer who defends workplace rights in Ukraine, told openDemocracy that a cohort of Ukrainian parliamentarians and government officials had used the Russian invasion as a “window of opportunity” to attempt to push through far-reaching changes to the country’s labour legislation.

These efforts, Sandul said, were part of a shift towards a “closing space” for labour organisations under the current Ukrainian government.

To help change this trend, Sandul proposed that international and state reconstruction efforts should guarantee the principle of social dialogue in Ukraine – where employers and unions, with input from the state, negotiate over work-related issues.

He pointed to the country’s mass volunteer movement that has emerged in response to the Russian invasion as evidence of Ukrainian society’s ability to self-organise, and therefore play an active role in socio-economic life.

Without at least some ‘minimal’ effort, Sandul said, poor working conditions in post-war Ukraine could lead only to further labour migration.

Zemlyanska was more pessimistic about the prospect of such negotiations, saying the principle of social dialogue had “died in Ukraine long before the Russian invasion”.

In recent years, attempts at Ukrainian labour reform – often under the rubric of liberalisation or modernisation – have failed due to public outcry and trade union protest

Vasyl Andreyev, president of Ukraine’s construction workers union and deputy chair of the Federation of Trade Unions of Ukraine (FPU), told openDemocracy that the reconstruction process should not only be about short-term financial benefits, including for Ukrainian workers, but also about their rights at the workplace and sustainable incomes.

Reconstruction, Andreev said, shouldn’t just be about “money in the pocket of construction workers”, but also concerned with “develop[ing] the internal labour market and social security provision that will remain in place” in Ukraine afterwards.

Given that there could be an exodus of Ukraine’s workforce after the war ends, Andreev said it was vital to ensure proper vocational training was available in the country – to back up infrastructure and construction projects after the war.

Since Russia’s invasion of Ukraine, the parliament has suspended parts of workplace protections and collective agreements during war time, as well as made ongoing efforts to pass legislation that would leave employees of small and medium-sized enterprises – which employ up to 70% of Ukraine’s workforce – outside of the scope of current labour legislation.

The latter draft law, which has been on the Ukrainian parliament’s books since 2020, would also give employers the right to terminate employment contracts at will.

“Passing this shameful document [draft law 5371] would be a blow not only to the labour rights of people, who are already in a difficult position, but a blow to our negotiating positions with the Europeans,” MP Ivanna Klympush-Tsintsadze, head of the Ukrainian parliamentary committee on EU integration, said on Facebook in June.

Parliamentary sources reported on 7 July that Ukrainian MPs would vote on draft law 5371 in the coming days.

In recent years, attempts at Ukrainian labour reform – often under the rubric of liberalisation or modernisation – have failed due to public outcry and trade union protest.

In 2021 openDemocracy revealed that the UK Foreign, Commonwealth and Development Office had funded a project to support a new government push on labour deregulation in Ukraine – which explicitly aimed to change public opinion around the controversial issue.

The Ukrainian government’s own recovery plan includes “modernization of labor legislation” – although no details have been released – as well as support for EU-style protections for health and safety at the workplace.

There are protections for workplace rights written into both the EU’s Association Agreement with Ukraine and the UK’s 2020 Political, Free Trade and Strategic Partnership Agreement with Ukraine.

But though Ukraine has now been granted candidate status in the EU, it remains to be seen whether these provisions and others could be used to influence the reconstruction process in favour of secure jobs and decent working conditions.

“The most important thing is to win – and then to see in what form Ukraine has ended the war, and what the future will look like,” said Zemlyanska.