Pay deal follows major strike at Automobile Dacia

On 24 March 2008, more than 7,500 workers at the Automobile Dacia car manufacturer in Romania launched an indefinite strike in support of pay demands. After several rounds of negotiations, and after a court ruling that the strike was legal, on 11 April Dacia management and the trade unions signed an agreement that ended the strike and awarded substantial wage increases.

Start of the conflict

Automobile Dacia (Dacia) is a car manufacturer located in Piteşti in south-central Romania. It is owned by the France-based Renault group. During negotiations over a 2008 collective agreement for the company, the bargaining panel formed of eight trade union leaders and eight managers failed to reach a consensus.

Consequently, the unions warned that they intended to call a two-hour strike on 14 March, and published a list of 14 claims. Their main demands for 2008 were the following:

  • A two-stage increase in pay for all employees by a fixed cash amount of RON 550 (approximately €150) per month;
  • A profit-sharing scheme for employees, amounting to 5%-10% of net profits;
  • An Easter and a Christmas bonus for all worker s, each worth 50% of average gross monthly pay at Dacia;
  • An annual leave allowance equal to one month’s average gross monthly pay, plus a RON 200 bonus on ‘Car Builder’s Day’ (which falls in September), and a day off on that date;
  • A 15% reduction for employees on the price of any car in the Dacia, Renault or Nissan ranges.

Initially, management offered a pay increase of 10%. After the warning strike was held on 14 March, the offer was increased to 12% (some €32 per month).

In response, an official of the Automobile Dacia Trade Union (Sindicatul Automobile Dacia, SAD) said: ‘Given a €150 million profit in 2007, the 12% offer is an affront’. The unions announced that an indefinite strike would start at 07.00 on 24 March. The employer said that ‘the claims could not be granted’ because accepting the unions’ demands would mean a hike from the 19% rise (in pay and bonuses) offered by management to an overall raise of 70%, which would be beyond any reasonable limit.

Progress of the strike

On 24 March, over 7,500 Dacia workers launched an all-out strike, with the support of the National Trade Union Bloc (Blocul Naţional Sindical, BNS).

Dacia management challenged the lawfulness of the strike before the Argeş County Court (Tribunalul Argeş, TAg), contending that the unions had failed to observe the required four-step collective bargaining procedure prior to calling the strike. It also claimed that only 40% of the workforce was participating in the strike and not 76%, as the unions claimed.

The court postponed its ruling. Management broke off negotiations pending a resumption of work and withdrew all previous offers, while the unions filed with the court a list of 7,664 signatures of workers supporting the strike.

On 8 April, management made a new offer of a monthly flat-rate pay increase of RON 200, backdated to 1 January 2008, followed by a second monthly increase of RON 90 from 1 September, plus a monthly bonus of RON 94 throughout 2008. The unions turned down this proposal.

On 9 April, the court ruled that the strike was legal and, on 10 April, some 5,000 union members staged a protest rally in the centre of Piteşti, attended also by representatives of BNS and of other Renault group trade unions.

Strike ends

During the night of 10/11 April, the unions and management held a new round of talks. Management proposed a flat-rate gross monthly pay rise of RON 300, backdated to 1 January, followed by a second increase of RON 60 from 1 September, plus a ‘success bonus’ of at least RON 900 in respect of 2007.

The unions consulted on the proposal and over 70% of union members accepted the offer and agreed to resume work.

On 11 April, the two sides announced that management’s offer had been accepted, and that the unions had signed an agreement with the company, adhering to all of the company’s objectives for 2008. The workers also undertook to catch up with lost production.

The overall wage rises (bonuses included) amount to approximately RON 450 per month gross.

Commentary

The 18-day strike at Dacia was one of the longest labour conflicts in Romania. Although the pay rise obtained by the workers looks high, the gross average wage at Dacia continues to be several times lower than that in the French units of the Renault group. The strike may be a warning signal to other employers who count on low wage costs in Romania.

Luminita Chivu, Institute of National Economy, Romanian Academy

Useful? Interesting? Tell us what you think. Hide comments

Eurofound welcomes feedback and updates on this regulation

Neuen Kommentar schreiben