Glass manufacturer to close despite trade unions' efforts

Despite the efforts of trade unions and the Walloon and Flemish governments to push through a restructuring scheme, the troubled Belgian glass manufacturer, Verlipack, is to close in December 1999. The stumbling-block was the failure to find a credible rescuer, able to propose sound financial and industrial plans.

Verlipack, a Belgian concern specialising in hollow glassware, which had been in deep financial trouble for almost two years, filed for bankruptcy for its three sites (Ghlin and Jumet in Wallonia, Mol in Flanders) in January 1999. After many twists and turns, the glass manufacturer had been taken over by the German group Heye Glass. However, as the competent federal authorities - the Walloon and the Flemish Region - had also acquired a stake in the company's equity, the destiny of the Flemish site was decided separately from that of the Walloon ones. Despite initiatives by the trade unions and the Flemish and Walloon governments, the guardian appointed by the Commercial Courts was ultimately unable to identify a credible rescuer.

On the Flemish side, an agreement had been reached in April 1999 with a French buyer, the Saverglass group. However, the agreement was contingent upon obtaining a soil rehabilitation certificate from the Flemish Ministry for the Environment. The Commercial Court had set the closing date for the takeover for 8 November 1999, but Saverglass was not able to produce the required certificate within this deadline. The two major creditors (Deutsche Bank and KBC) had moreover set their own ultimatum for 1 December 1999, the date on which the Mol furnace was scheduled to be closed and the 140 jobs definitively lost.

On the Walloon side, the takeover scenarios took a number of turns and it seemed at one point that one of the two sites (Jumet) risked being sacrificed to the advantage of the other one (Ghlin). Rudy De Moyer, former vice president of Verlipack, offered to take over the two sites and save 375 jobs out of 450 threatened ones, but the Commercial Court promptly turned down the offer. A takeover offer for the Jumet site presented by Bernadette Del Ré was also rejected. Ultimately, the Commercial Court retained only the plan presented by a last takeover candidate, Dominique Balcaen.

Mr Balcaen proposed keeping open only the Ghlin site and retaining 125 jobs, some of which would be transferred from Jumet. The plan was negotiated with the two major trade union organisations, the Belgian General Federation of Labour (Fédération Générale du Travail de Belgique/Algemeen Belgisch Vakverbond, FGTB/ABVV) and the Confederation of Christian Trade Unions (Confédération des Syndicats Chrétiens/Algemeen Christelijk Vakverbond, CSC/ACV). It finally obtained the endorsement of a majority of workers employed at the Ghlin site (62%) and of the guardian, with the Walloon government agreeing to participate in the recapitalisation.

However, not one of the five banks canvassed by Mr Balcaen would grant him a loan. The prospects for a takeover of Verlipack-Ghlin were thus very much jeopardised. On 18 October, Verlipack-Jumet's furnace was definitively closed. If no solution is found together with the banks and the Commission, Verlipack-Ghlin's furnace was to follow suit and be closed on 3 December.

In the absence of an interlocutor on behalf of the management and of credible takeover prospects, the trade unions were forced to refocus their action on reconversion possibilities, in particular for the Ghlin site. Workers' representatives initially proposed to the regional authorities (Serge Kubla, Minister for Economic Affairs) to reconvert the Ghlin site into a glass-recycling facility, with an injection of public and private capital.

Finally, the trade union organisations concentrated their efforts on attempting to convince the competent ministers (Michel Daerden on the Walloon side and Renaat Landuyt on the Flemish side) to set up outplacement units coupled with training schemes provided by the regional employment and training authorities: the Office communautaire et régional de la formation professionnelle et de l'emploi (FOREM) in Wallonia and the Vlaamse Dienst voor Arbeidbemiddeling en Beroepsopleiding (VDAB) in Flanders. In the past, similar schemes have successful in putting 80% of redundant workers back into the labour market.

In the end, the notable elements of this episode are the absence of an interlocutor on the employers' side and the sense of responsibility displayed by the trade unions, which weighed in with all their forces to avoid a major social conflict and ensure the continuation of activity.