Latvia - 2

Title of the survey

Labour cost survey.

Organization responsible

Central Statistical Bureau of Latvia.

Periodicity of the survey

Annual (1998 and 1999, with reference to 1997 and 1998).

Objectives of the survey

To obtain information on average annual and hourly labour cost.

Main labour topics covered by the survey

Employment, hours of work and labour cost, as well as information on enterprises' practices with regard to social security and pension schemes, and payroll taxes.

Reference period

The calendar year, for each variable.

Coverage of the survey

Geographical

The whole country.

Industrial

In 1998: manufacturing. In 1999: electricity, gas and water supply; construction; wholesale and retail trade; repair of motor vehicles, motorcycles and personal and household goods.

Establishments

In the public and private sector: enterprises with 20 or more employees, or with net turnover above 200,000 Lats in previous year and that have operated a whole year, except in manufacture of grain mill products, bread, fresh pastry goods and cakes: enterprises with 10 or more employees.

Persons

All employees.

Excluded are working proprietors, members of boards and councils of enterprises, commission agents, home workers, casual workers, workers sub-contracted from other companies or firms, workers from temporary work agencies as well as unpaid contributing family workers. Women on maternity and family leave up to 3 years and persons on temporary military service are also excluded.

Occupations

Data are not collected by occupation.

Concepts and definitions

Employment

Data are collected on full-time and part-time employees, and apprentices, separately.

Full-time employees are employees (excluding apprentices) whose regular working hours correspond to those provided by the law or collective agreements, or customary working hours.

Part-time employees are employees (excluding apprentices) whose regular working hours are less than customary working hours, whether daily, weekly, or monthly as agreed.

Apprentices are employees whose work is connected with the acquisition of knowledge (e.g. apprentices, employees training for a new occupation, students of higher educational establishments on a vocational practice, stagiaires) under an apprenticeship contract.

The total number of employees excludes apprentices.

Labour cost

This is defined as the total expenditure borne by employers in order to employ workers. Information is collected on the following components:

1. Gross wages and salaries in cash and in kind: payments to contractual workers by employers (before deduction of employees' personal income and social taxes). They include:

direct remuneration: remuneration in the form of regular cash payments which include: (i) basic wage and salary; (ii) direct remuneration calculated on the basis of the time worked, output and piecework and paid to employees for hours worked ; (iii) remuneration and additional payment for overtime, night work, working on days off and public holidays, for difficult and unhealthy work; (iv) bonuses paid regularly; individual performance bonuses; bonuses for output, productivity, responsibility, diligence, punctuality, length of service, qualification of special knowledge.
bonuses paid at fixed periods: payments to employees that are not paid on a regular basis (each month, quarter, etc.) and that are paid irrespective of the results (Christmas or Easter payments, 13th month payments, payments in the event of the anniversary of the enterprise, on professional or other holidays and the like); supplementary vacation bonuses and compensation for vacation not used.
payments for days not worked: personal and public holidays, days paid for but not worked by (blood) donors, study leave, days off for civic duties (e.g. assessor in the court) and other paid days off, as well as public holidays (e.g., Christmas holidays).
wages and salaries in kind:
1. wages and salaries in kind ; price of company products supplied free of charge, or the difference between the cost price and the price at which the products are sold to staff ; employers' expenditure on food products and beverages bought for holidays;
2. expenditure to assist employees with housing, including expenditure on housing owned by the enterprise (expenditure on the maintenance and administration of housing, and tax and insurance relating to such housing). It also includes non-refundable loans for the purchase of flats by staff;
3. employers' expenditure related to the use of company cars for employees' personal needs.

2. Employers' actual and imputed social security contributions:

Employers' statutory social contributions (from 1 January 1998: social security contributions) (excluding statutory social security contributions paid for apprentices).
Contributions to the pension security fund;
Employers' other social security contributions: contributions for health and life insurance and other insurances (e.g. for a private car used for business purposes).
Employers' imputed social contributions: direct payments made by employers to their employees without involving social security funds (e.g. for sick list A, short-time working, and severance pay), occupational health services and other benefits to present and former employees.
Guaranteed remuneration in the event of sickness: payments for sick list A made by employers according to Article 36 of the Law on maternity and sick benefits (75% of the employee's average earnings for the 2nd and 3rd days of sickness, 80% of average earnings for the 4th to 14th days of sickness), according to provisions of collective agreements, or according to Article 14 of the Law on compulsory social insurance against occupational accidents and diseases for the first 14 calendar days. (It does not include payments for sick lists from the State Social Security Fund.)
Guaranteed remuneration in the event of compulsory short-time working, in accordance with the legislation (salary per hour or per day) or collective agreements.
Severance pay: sums paid in accordance with the legislation to dismissed workers who leave their work involuntarily;
Welfare services to families: sums paid by employers to employees in the event of their jubilees, wedding, birth of child, to cover payments for communal services and other agreed payments to present and former employees and their families.
Occupational health services: sums paid employers to employees to compensate in part or in full for the purchase of medicine, treatment in health institutions, sanatoriums and outpatient departments of enterprises, as well as remuneration paid to employees for the occupational detriment to their health (not under sick list A).

3. Vocational training costs paid by the employer: for vocational training and improvement of employee's professional skills. It comprises gross wages and other remuneration for apprentices; employers' social security contributions for apprentices; other costs: wages and other payments to alien employees undergoing a vocational training; materials, energy, teaching aids, etc., repairs of training rooms and equipment, costs of their maintenance, depreciation; and payments to educational establishments for training of enterprise staff.

4. Other employers' expenditure:

recruitment costs such as expenditure on advertisements, sums paid by employers for the services of labour agencies; allowances paid to newly recruited staff to compensate for their removal expenditure, etc.;
expenditure related to training subsidies, maintenance and repairs of cultural, sporting and leisure facilities, kindergarten and day nurseries, shops, inpatient medical services and other structural subordinate units of enterprises, and wages of alien employees;
transportation costs between home and the usual place of work;
payments into funds of trade unions and unions of employers;
cost of work clothes;

less

5. Subsidies received by employers: sums received from the state that compensate for the employers' expenditure related to wages and salaries (financing of wages for the unemployed who are temporarily employed, from the State budget and the State Employment Service funds).

Hours of work

Data are collected on total hours actually worked and total hours paid for, separately for full-time and part-time employees.

Hours actually worked correspond to the total number of hours worked by all employees (excluding apprentices), including hours provided by law, collective agreement, labour contract or customary working hours (i.e. normal hours of work) and overtime hours, and excluding hours paid for but not worked (e.g. for paid leave, sick leave, personal and public holidays, short-time working), meal breaks, commuting time and hours worked for which employees receive no compensation.

Hours paid for are all hours worked, including paid overtime hours, plus hours of paid absences for holidays, sick leave, short-time working, jury duty, etc. They exclude time corresponding to meal breaks, weekly rest days, time not worked due to military related service, disciplinary suspension and commuting time.

International recommendations

The definitions of labour cost and hours actually worked conform to the international recommendations.

Classifications

The data on labour cost are classified by component group (see above, under Concepts and definitions). This classification is compatible with the International Standard Classification of Labour Cost (ISCLC-1966).

Industrial

The survey data are classified according to the Standard Classification of Economic Activities of the European Communities (NACE) Rev. 1 at the two-digit level. NACE Rev.1 is based on the International Standard Industrial Classification of all economic activities (ISIC), Rev.3, 1990.

Occupational

Not relevant.

Others

By size of enterprises: 20-49 employees (in grain mill products, bread, fresh pastry goods and cakes: 10-49 employees), 50-249, 250-499 and over 499; and by sector (public, private).

Sample size and design

Statistical unit

The survey unit is the enterprise.

Survey universe / sample frame

It consists of the Business Register which includes enterprises on which the Central Statistical Bureau holds appropriate information obtained from the State Enterprise Register, other government agencies and through contacts with the enterprises.

Sample design

The survey is based on a complete enumeration of enterprises.

Field work

Data collection

This takes place in March-April of each year, by mailed questionnaires which are to be returned to the local departments or the main office of the CSB by 12 April.

In 1998, the questionnaires were sent to 1269 manufacturing enterprises, out of which 173 were found to be out of the survey scope.

In 1999, they are being sent to 2,249 enterprises.

Survey questionnaire

The questionnaire seeks information on the characteristics of the enterprise, the number of employees, the number of hours paid for and actually worked, the number of working hours lost due to short-time work and strikes and lock-outs, the number of days paid for but not worked, compensation of employees, employers' vocational training costs, other expenditure paid by the employer, and subsidies received by the employer.

Explanatory notes on definitions are provided with the questionnaire.

Substitution of sampling units

Sampling units are not replaced in the event of total non-response.

Data processing and editing

The data are coded and processed by computer, using Fox Pro. The survey forms are first checked by CSB statisticians. In case of missing or inconsistent data, contacts are made by mail or telephone. Consistency and logic checks are also carried out by computer.

Types of estimates

Number of employees, total labour cost for all employees and average annual, monthly and hourly labour cost;
Average hours actually worked and paid for per week;
Distribution of labour cost by components (structure).

Average annual labour cost per employee is obtained by dividing the total labour cost by the number of employees in full-time units.

Part-time employees are converted to full-time units according to the following formula:

Dn = (Sn / Sp) x Dp + Dp , where

Dn is the number of employees in full-time units,

Sn is the number of hours worked by part-time employees,

Sp is the number of hours worked by full-time employees,

Dp is the number of full-time employees.

Average hourly labour cost is calculated by dividing the average annual labour cost per employee by the average number of hours actually worked during the year.

Construction of indices

None.

Weighting of sample results

Not relevant.

Adjustments

Non-response

None.

Other bias

None.

Use of benchmark data

Not relevant.

Indicators of reliability of the estimates

Coverage of the sampling frame

The Business Register provides for complete coverage of enterprises.

Sampling error / sampling variance

Not relevant.

Non-response rate

Approximately 1.8% in terms of the number of enterprises which did not return the questionnaires for unknown reasons.

Non-sampling errors

Not available.

Conformity with other sources

Average annual data on wages and salaries from the labour cost survey are divided by 12 and checked against the corresponding average monthly data from regular surveys.

Estimates for non-survey years

None.

Available series

Published results include:

Average annual labour costs per employee and their structure,
Average hourly labour cost and,
Average weekly hours actually worked and paid for, by economic activity, enterprise size classes and sector;
Distribution of employees in manufacturing, by industry group, and category (full- time, part-time, apprentices).

History of the survey

The Labour cost survey started in 1998, with reference to 1997, and was limited to manufacturing. The 1999 survey (with reference to 1998) covered electricity, gas and water supply; construction; wholesale and retail trade; repair of motor vehicles, motorcycles and personal and household goods.

Future modifications will be brought to the survey in terms of coverage, sample design, statistical unit (establishment instead of enterprise) and periodicity (as from 2001: four-yearly instead of annual).

Documentation

Central Statistical Bureau: Statistical Bulletin Labour cost in manufacturing, 1997 (Riga); the survey results were available some twelve months after the survey reference period. This publication also contains some methodological information.

Unpublished data (e.g. according to the ISCLC-1966) can also be made available upon request and data can be obtained on diskette.

Web-site: http://www.csb.lv

Confidentiality / Reliability criteria

In compliance with the Law On State Statistics (1997), all data collected are treated as confidential and used only for statistical purposes. No data are published where there are only one or two enterprises in an economic activity or size class.

Other information

Data supplied to the ILO for publication

Statistics of average hourly labour cost in manufacturing are published in the Yearbook of Labour Statistics.