The economic crisis and the EWC

Dr. Werner Altmeyer

Sibiu, 07.10.2010

Agenda

1. Problems during crisis

2. Some figures: Multinationals with EWC

3. EWC Intercultural Experiences

4. Information and Consultation provision to the EWC

5. EWC in Practice

6. Examples of transnational agreements

Problems during crisis

Accelerated transnational restructuring, mergers and acquisitions

How to safeguarde employment and skills?

How to safeguarde sites and branch offices?

The reality: 50% of all European works councils are not consulted before

a transnational restructuring decision is made public

What is „consultation“ about?

How strong is the link between national and European works councils?

Multinationals with EWC

EWC Directive

1994 EU Directive

1996 national laws

1999 Art. 15 Revision

2004 initiative

2009 new EU Directive

2011 new national laws

961 + 48

431

49

Art.13 Art.6

1994 20101996

~ 2.300

Delegates from new Member states

961 EWC bodies currently active, more than 20,000 delegates

209 EWC bodies including one or more representatives from a new EU

member state (2004)

41 EWC bodies including one or more representatives from a new EU

member state (2007) - Bulgaria and Romania

24 EWC bodies including one or more representatives from EU applicant

countries (Croatia, Macedonia, Turkey)

Data source: European Trade Union Institute, EWC database, July 2010

A “ typical “ EWC today

23 members, increasing number

from 9 countries, one third from host country

5 management representatives involved

Select committee of 5 members

2 plenary meetings a year (ordinary + extraordinary) over two days

3 select committee one–day meetings a year

3 out of 10 EWCs have mixed working groups on specific issues

Source: Evelyne Pichot, European Commission

EWC Intercultural Experiences

Betriebsrat + GewerkschaftenWorks council + trade unions

Comité d´entreprise + syndicats

BetriebsratWorks council

Comité d´entreprise

GewerkschaftenTrade unions

Syndicats

Mediterranean model

„Germanic“ model

Anglo-Saxon model

Transformation model

Scandinavian model

Alcatel-Lucent

December 2006: merger Alcatel (F) and Lucent Technologies (USA)

Consequence: 12,500 jobs are on the list of cuts

March 2007: European protest day

April 2007: French jugdes draw up criterias

November 2009: Day of action in six European countries. Some support

was also given from US employees. Since the merger of the two former

companies in December 2006, four restructuring programmes have been

carried out up to now and thousands of jobs dismantled.

Alcatel-Lucent

The employer must present to the EWC the following: a precise, figured report on the reasons for closure, shift and

merger of business activities a precise, figured exposition of the calculation method and the elements

which were used for the calculation of the alleged staff overhang the number of planned job cuts, and to be more precise for every division

and for every country, separated into employee categories exact and figured grounds for this distribution and the time schedule for

the planned downsizing

This information must be „complete and precise enough, to explain

the development of the employment on an European level to the EWC

and to allow for an exchange of views and dialog with the

management in view of full knowledge of the facts“.

Gaz de France

November 2006:

EWC stops the merger with the Suez group by interim injunction

January 2008: the highest French court confirms the decision

→ Supervisory and administrative boards of multinational companies can

not decide to merge with other companies until the consultation of the EWC

has taken place in due form and wasn't completed correctly in all details. A

financial analysis is also part of the procedure by consultancy firms which

the EWC selects itself. The judges give an independent participation right

to the EWC, independently of participation rights in individual countries.

Highlight of a number of verdicts in France which strengthen the meaning

of transnational employee representations

What means “information”?

The Directive 1994 doesn't define information at all

The Directive 2009 describes as follows:

Information means transmission of data by the employer to the

employees’ representatives in order to enable them to acquaint themselves

with the subject matter and to examine it

at such time, in such fashion and with such content as are appropriate

to enable employees’ representatives to undertake an in-depth

assessment of the possible impact

and, where appropriate, prepare for consultations with the competent

organ of the group

The following questions must be answered:

Examination: How fast can EWC members check financial data

thoroughly?

Time: When is the adequate moment?

Method: What is adequate to the purpose?

Assessment: How can EWC members judge the possible consequences

thoroughly?

Preparation for consultations: How does one prepare for it? Which tools

and framework conditions to be fulfilled?

When will a measure have significant consequences? (Example Wabco,

October 2008: "if by an alteration at least 50 jobs are concerned in two

countries")

What means “consultation”?

The Directive 1994 defines as “exchange of views and dialogue”

The Directive 2009 defines consultation more exactly:

at such time, in such fashion and with such content as enables

employees’ representatives to express an opinion on the basis of the

information provided

within a reasonable time, which may be taken into account within the

group

The following questions must be answered:

At which moment does a statement still have influence on the decision

making of the central management?

Adequate period: How fast can EWC members work out a statement

which takes into account all relevant financial data?

What does “statement” mean at all? (in France this is an alternative

restructuring plan, worked out with the assistance of consultancy firms)

A missing statement leads automatically to a prohibitory injunction

against central management (see example of Gaz de France)

EWC in practice

Symbolic EWC

Service driven EWC Project driven EWC

Participative EWC

EWC in practiceTypology

EBR - EWC - CEE

Symbolic EWC

Management

EWC in practiceTypology

EBR - EWC - CEE

Management

Service driven EWC

EWC in practiceTypology

EBR - EWC - CEE

Project driven EWC

Management

EWC in practiceTypology

EBR - EWC - CEE

Participative EWC

Management

June 2009: the French electronics company Thales signed a first

transnational agreement for 56,000 employees in eleven countries.

Aim: improving the professional development of employees

Whereas normally only general principles are defined in comparable

agreements for other companies, Thales has committed itself to

achieve concrete objectives and to put in place a monitoring process.

April 2010: additonal agreement on personnel development reviews

This is a milestone for staff development within high tech companies.

Examples of transnational agreements

November 2009: the Luxembourg based steel group ArcelorMittal,

which has been hit hard by the crisis, signed an agreement for

115,000 employees in 34 countries.

Aim: promote long term job security, the development of employee

competency and to improve social dialogue.

A high-profile group for social dialogue has been set up, to monitor

the profitability of all sites and the supervision of the agreement.

Establishment of parity based control committees in each country.

An arbitration board is planned for any disputes.

Examples of transnational agreements

July 2010: the French metal companies, Alstom and Schneider

Electric, signed an agreement for EU, Norway, Switzerland, Turkey.

Aim: to regulate conditions for employees which are affected by the

sale of the power transmission and distribution divisions of the French

nuclear company Areva to Alstom and Schneider Electric.

Three years guarantee for no plant closures and no redundancies.

Once a year, the EWC will evaluate compliance to the agreement.

This is the first time in EU history where the social consequences of

an acquisition are regulated in a transnational collective agreement.

Examples of transnational agreements