Multinational companies and collective bargaining
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MNCs and trade unions
Trade unions’ attitudes towards MNCs and responses to their impact on collective bargaining vary. In some countries, especially in the NMS as well as Ireland, the Netherlands and the UK, trade unions have a generally positive view of MNCs and welcome the inflow of foreign investment. In Poland, trade unions have in some cases been willing to sign special deals – in particular no-strike agreements – in order to attract investment, especially from the US and Japanese companies, echoing similar practices in the 1980s in the UK. While the potential for employment creation is a common motivation, a frequent additional justification in the NMS is the expectation that foreign-owned companies might transfer into local industrial relations environments their west European social dialogue and employee participation practices. Nevertheless, research studies raise some doubts in this respect, as industrial relations transfers from the West seem to be the exception rather than rule, and contingent on rather specific conditions (Marginson and Meardi, 2006; Meardi et al, 2009).
By contrast, trade unions in some west European countries express negative opinions about MNCs. In Belgium, the unions criticise MNCs for their tendency towards more conflict-prone industrial relations, in addition to excessive flexibility and remote management structures. In Sweden, meanwhile, trade unions are critical of MNCs’ aims to further decentralise collective bargaining and in the industrial sector have successfully opposed further movement in this direction. Elsewhere, trade unions have not necessarily favoured the decentralisation of bargaining, but have accommodated pragmatically such developments.
The most pressing issue for trade unions in respect of MNCs is how to deal with their geographic mobility, especially in the form of relocation threats (TN0511101S) (see Chapter 4). Trade unions have responded to such threats in a variety of ways, as indicated by the examples provided by EIRO national centres (Table 12).
| Country | Trade union response |
|---|---|
| AT | Trade unions have called for local governments to withdraw their subsidies to MNCs that do not keep their job guarantee commitments by relocating abroad. Other efforts include the negotiation of social plans. |
| BE | Trade unions have organised customer campaigns against some MNCs, for instance against the automobile manufacturer Renault using the ‘This is my last Renault’ stickers. |
| DE | IG Metall has called for uniform international accounting laws; it also requests that relocation decisions should require a two-thirds majority on the supervisory board of large German companies. |
| ES | Public demonstrations have been held against Volkswagen, Nissan and Delphi, with successful resistance against relocation at Volkswagen. |
| HU | A protest demonstration was held outside General Electric’s Budapest headquarters, along with a 30-minute warning strike at the major plant near Budapest against threatened relocation of production from two plants to China (HU0801039I). |
| IE | A large public demonstration took place in light of the Irish Ferries case, threatening disruption of the national-level social partnership and leading to a compromise agreement with the involvement of the primary dispute-resolution institution, the Labour Relations Commission (IE0512203F). |
| IT | An alternative industrial plan was proposed for the Electrolux plant in Scandicci in western Italy, leading to an agreement on the sale and reconversion of the site (IT0810039I). |
| LT | In order to reduce the risk of relocations eastwards, the Trade Union of Lithuanian Food Producers (Lietuvos maistininku profesine sajunga, LMPS) at the Philip Morris tobacco company initiated the establishment of a coordination council comprising trade unionists from Kazakhstan, Russia and the Ukraine. |
Source: EIRO national centres
The diversity of responses and outcomes, as evident from Table 12, goes against any deterministic view that relocations are unavoidable and that trade unions’ responses are doomed to failure. Strategies vary from defensive ones – such as concession bargaining or the negotiation of social plans – to more offensive strategies, including political mobilisation, creating openings for political exchange and negotiations on alternative business plans. It is also important to observe that different responses may be better suited in different contexts, and that the same strategies that are successful in some places may fail elsewhere. For instance, the Irish mobilisation efforts seen at Irish Ferries, or the French political pressure evident at the power generation company ABB-Alstom Power, have failed on other occasions where circumstances differ – such as in France in the Arcelor case (Erne, 2008). It is also difficult to determine in which instances concession bargaining is unavoidable, and in which cases it can be resisted. Portuguese trade unions at the General Motors plant in Azambuja refused to make concessions in 2005, but could not avoid the plant’s closure in 2006. By contrast, at the Portuguese Volkswagen plants, continuous dialogue and negotiations have prevented relocations. Recent research confirms the variability and contingency of trade union responses to relocation threats (Meardi et al, 2009).
When mobilisation occurs, sometimes it takes specific forms due to the high visibility of many MNCs. Particular media interest in protests against MNCs has been noted in Belgium (Carrefour, Renault, Volkswagen), the Czech Republic (Škoda and Siemens), Denmark (Lidl), Poland (retail chains), and the UK (Total). In addition, protests and campaigns against MNCs tend more frequently to involve other actors, such as non-governmental organisations (NGOs) – as seen in the case of Attac in France; or they may even lead to the emergence of new campaigns, such as the Association of the Harmed by Large Commercial Chains ‘Biedronka’ initiative in Poland. In the NMS, as well as Spain, trade union protests against MNCs often take the form of legal action in addition to, or instead of, industrial action.
Trade unions have also been counteracting MNC comparisons by collating their own comparative information. This takes different forms. The trade unions that most frequently use international wage comparisons in their own national collective bargaining are those from the lower-wage NMS, including the Czech Republic (especially at Škoda and Siemens), Latvia, Romania and Slovakia. In west European countries, comparisons focus on other issues in order to counteract the employers’ labour cost considerations. The Swedish Union of Metalworkers (IF Metall), in particular, has been collecting its own comparative information on productivity, while the British trade union Unite has been comparing employment protection in cases of MNCs’ restructuring at Peugeot-Citroën, General Motors and the steel company Corus.
In this regard, international trade union contacts are important. In metalworking, in particular, the collective bargaining coordination initiative of the EMF is visible. Recently, new international network activity, often within the EWCs, has emerged in a number of countries. This has occurred in the west – for example, at Nokia in Finland. It has also emerged in the east – for instance, at Gas de France in Romania, where international pressure led to the signing of a social pact including a new ‘Common Social Charter’ on employee rights and guarantees; a similar one is now proposed at the gas company E.ON Ruhrgas.
UK trade unions have reportedly been less active than others in western Europe in international action. This can be attributed to constraints on the right to strike and, until recently, the absence of information and participation prerogatives. It is also linked to the trade unions’ organisational focus on the plant rather than the company. In rare cases – for example, the mobilisation in the Netherlands against the mining equipment manufacturer IHC Holland’s activity in Myanmar in southeast Asia – trade unions have been involved in campaigns against MNC activities outside the EU, similar to actions in the 1970s and 1980s regarding operations in Chile and South Africa.
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