Green Transition and Industrial Relations at the Workplace: Evidence From Italian Firms

ABSTRACT This article analyses the role of green investments (GIs) in the adoption of decentralised bargaining and the single aspects negotiated therein. Using data on a large representative sample of Italian firms, we find that investing in green technologies increases the overall probability of decentralised agreements. Further, GIs lead to an increase in negotiations on performance‐related pay and welfare benefits. These results are robust to an econometric strategy that controls for unobserved heterogeneity and endogeneity issues. Our explanation for this evidence is that the current ecological transition in production processes is likely causing significant organisational changes. Managing these changes requires increased flexibility in negotiating critical issues at the company level, such as wage premiums and non‐monetary benefits to employees.