Restructuring at Electrolux has impact in Spain

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In response to the announced restructuring of the Swedish multinational Electrolux, which may make several thousand workers redundant over the next few years, the Spanish workers' representatives have started to take action. However, there seems to be lack of effective coordination between the trade unions operating across the group's different European factories.

The Swedish-based "white-goods" multinational Electrolux is planning a restructuring of its subsidiaries that will involve the closure of 25 of them across different countries over the next five years. This would lead to some 12,000 redundancies.

One of the subsidiaries threatened by this restructuring is at Fuenmayor located in the wine-growing region of La Rioja. It has been there since 1976 and, employing 1,500 people directly and indirectly, counts as one of the most important industrial companies in the region. The reason for the restructuring is that a refrigerator which is now manufactured in Spain, and represents a third of the company's production, will be built in Hungary from 1998, following a decision by the multinational's central management.

The viability of the factory in La Rioja, and the eventual fate of the companies that will be affected by the restructuring, will depend to a large extent on the site chosen for manufacturing the new horizontal freezer for which Electrolux is planning, the Euro-Combi. In addition to Spain, the United Kingdom, Italy and Sweden are also competing for it.

The alarm was raised in the Spanish region by both the workers and the managers of the Electrolux subsidiary. Both parties have contacted the Regional Government of La Rioja and the Spanish Industry Ministry in order to gain their direct support for the investment that will be necessary to manufacture the Euro-Combi. It is easy to foresee that similar political and economic moves will be made in the other countries, and that the multinational might take its final decision according to the aid received and the internal market that can be expected for the new product.

Trade union sources believe that, in a situation of this kind, there is a need for a European Works Council (EWC) that has the capacity to intervene in the restructuring process. In addition to the economic questions, the EWC should be able to consider the social repercussions of a measure of this type, taking into account the level of employment in each country that is a candidate for the new investment.