Company-level bargaining underway in the food sector

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A particularly important stage in the renewal of company-level agreements in the Italian food sector started in June 1998. As usual, Galbani (part of the Danone group) has played a "pace-setting" role, followed swiftly by Nestlè, introducing important new provisions in the areas of industrial relations, working time and performance bonuses.

After a period characterised by reorganisation processes in some of the Italian food sector's major firms - an example being Galbani, part of the French-owned Danone group (IT9707117N) - negotiations over the renewal of many company-level agreements started in mid-1998.

The first company to reached an agreement was Galbani. The Galbani company-level agreement was signed on 25 June 1998 and is particularly significant, since it traditionally plays a "pace-setting" role, highlighting the trends and contents which are subsequently included in company-level bargaining as a whole. The most innovative and interesting features of this agreement concern the company-level industrial relations system, working time schedules and performance bonuses.

Immediately after Galbani, Nestlè Italiana, the subsidiary of the Swiss-based group, signed its company-level agreement on 30 June 1998. This agreement is also significant since, though it follows the general themes developed by the Galbani deal, it adds some interesting specifications and includes a chapter on employment creation.

More participatory industrial relations

The company-level agreements at Galbani and Nestlè confirm the importance of the "Rsu coordination committee" (Coordinamento delle Rsu), a body created by the previous company-level agreements at the two firms in order to provide a single representative structure for each company's various plant-level "unitary trade union representation bodies" (Rsus). In particular, the coordination committees' competence now covers working time, women's employment, labour costs and competitiveness, vocational training and work organisation. In these domains, the coordination committees also have a dispute-resolution role, in the event that an agreement at plant level should prove impossible to reach.

Furthermore, the Rsu coordination committees should, under the new company agreements, become the centre of a new and more participatory model of company-level industrial relations. Firstly, the agreements both set joint "training paths" which should "support joint action of the parties on shared goals, aiming at cooperation rather than antagonism in coping with change in a competitive environment". With this objective in mind, company managers will hold workshops with the representatives who sit on the coordination committee, focusing on information about: the food market worldwide and in Italy; the level of competition and the position of their company in comparison with competitors; expected development trends; and the main strategic issues at company-level.

Another interesting feature of the two agreements is the provision for regular meetings - at least twice a year for Galbani and on the parties' request at Nestlè - between a delegation from the coordination committees and company management, in order to discuss the following subjects:

  • the group's industrial strategies, with particular reference to their occupational impact;
  • productivity and competitiveness;
  • investments, both for maintaining existing production capacity and for research and development;
  • relations with agricultural production and with customers (in particular retail chains); and
  • occupational trends related to technological innovations, company reorganisation, new production or the "outsourcing" of processes.

This delegation (or "select committee") will be made up of one representative each of the national secretariats of the food sector federations of the main union confederations - Fat-Cisl, Flai-Cgil and Uila-Uil- together with a number of representatives of the Rsu coordination committee - six at Galbani and five at Nestlè. A clearly stated objective of the Galbani agreement is to foster the development of a "participatory culture based on informed involvement" which could be supported by specific training initiatives. The companies will state in each meeting which part of the information provided should be considered confidential. The select committee must inform the coordination committee promptly of its work with management, and the coordination committee remains the sole holder of bargaining rights.

Working time

In order to cope with the need for competitiveness and flexibility, the two agreements cover the issue of working time. Galbani has entrusted to a joint "information and study commission" an assessment of the feasibility of new working time arrangements - weekend shifts (part-time working on Saturdays and Sundays), multi-plant part-time work (part-time workers moving on a regular basis from one plant to another), job-sharing and telework. In Nestlè, on the other hand, it will be possible to start actual experiments with new working arrangements, such as:

  • "compressed work" - that is, the "compression" of the whole working week on fewer days than the ordinary five;
  • rotation among different jobs during the same working week (and therefore potentially among different working time schedules);
  • the calculation of working time on a monthly or yearly basis, through the use of "positive" and "negative" flexibility, as with an "hours bank" scheme;
  • "mixed" part-time arrangements, for instance multi-plant part-time work (see above);
  • teleworking;
  • job-sharing; and
  • weekend shifts.

These initiatives are part of a wider commitment by the two companies to a search for new work organisation models based on autonomy, responsibility and professional development.

Finally, both agreements provide for a joint supervision of overtime, which should enable the parties to assess the possibility of converting overtime work into new employment opportunities. For this reason, for example, the Galbani agreement envisages the hiring of 10 new maintenance workers.

Performance bonuses

Under the provisions of the tripartite central incomes policy agreement of July 1993 (IT9709212F), the variable pay regulated by company-level agreements is made up of two components: the first is linked to company returns; the second is related to plant-level indicators which must be defined through plant-level bargaining, and which may include quality, productivity, flexibility, equipment utilisation rates etc.

Since performance bonuses are considered by the parties as a useful means of ensuring worker involvement, as they make a closer link between company results and workers' performance, the two agreements introduce some innovations in this area. In particular, there is a tendency to reduce the relevance of the reference to company returns in comparison with previous agreements, whereas the importance of plant-level indicators such as quality and productivity, which are closer to workers' understanding and participation, is increased. Significantly, the agreements provide for a joint assessment of the implementation of performance bonuses.

Investment for employment at Nestlè

The Nestlè agreement provides for the creation of an "investment for employment" fund to which the company will contribute ITL 250 million in the next two years. The use of these resources will be jointly decided by the company and trade unions and will be devoted to the professional development of people searching for their first job, in order to help them find an occupation either in Nestlè itself or in other companies.


The renewals of company-level agreements in the food sector apparently confirm a tendency towards cooperation between trade unions and employers which was already present, for instance, in the Galbani reorganisation process, where an agreement was reached for the outplacement or redeployment of the 1,200 staff made redundant, with no recourse to dismissals. The new company agreements' provisions represent a further step in this direction and, significantly, towards the creation of an institutionalised system of "participatory" industrial relations.

This means that the cooperation between the parties is not left to the attitudes of trade unions and company management, but it is embodied in specific procedures. The creation of the "select committee" of the Rsu coordination committees and the provision for regular meetings for information on company strategies, backed by training initiatives, is very significant. The statement on confidentiality of information and the clear distinction between the select committee, which has an information and consultation role, and the coordination committee, which has bargaining rights, seem to outline the first elements of a "dual channel" of company-level employee representation. This is a very peculiar dual channel, though, since both channels are entirely assigned to trade unions, with a problematic overlapping between the persons who bargain and those who "participate".

Leaving aside these possible difficulties of the industrial relations model which is emerging in the Italian food sector's major companies, it is undoubtedly interesting to note that all the components of company-level bargaining seem to be moving towards the same objective of increasing workers' involvement and participation, with the central role played by trade unions. Apparent steps in this direction include not only the establishment of the information and consultation meetings, but also: the joint study of, and experimentation with, new working time and work organisation models; the increased relevance of performance indicators closer to workers' understanding and participation; and the joint supervision of performance bonuses. (Roberto Pedersini, Fondazione Regionale Pietro Seveso)

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