Finland's mainly state-owned Leonia finance group gave notice in spring 1998 of massive reorganisation involving large-scale redundancies. Employees are vigorously opposed to the dismissals, which are now under negotiation in the works council. If a solution cannot be reached, the dispute will escalate into a widespread boycott.
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Finland's mainly state-owned Leonia finance group gave notice in spring 1998 of massive reorganisation involving large-scale redundancies. Employees are vigorously opposed to the dismissals, which are now under negotiation in the works council. If a solution cannot be reached, the dispute will escalate into a widespread boycott.
The largely state-owned finance group, Leonia, annnounced a massive reorganisation and workforce-reduction programme in spring 1998, to be carried out over the next two years. The programme, which altogether affects 1,500 employees (including some who have already been made redundant) out of the group's 5,000-strong workforce, is currently under negotiation by management and employee representatives in the works council. It is justified by Leonia on the grounds of cost-effectiveness. The Finnish Bank Employers' Union (Pankkitoimihenkilöliitto, PTL) has decided to support the Leonia employees by means of boycotts if needed. The start of any such industrial action depends on the progress of the works council negotiations.
The talks between employee representatives and the management have already started, with the former proposing that Leonia should stop the reorganisation measures until "rules of the game" have been jointly agreed upon. According to the employees, the group's new management has contradicted the proposed cuts in the bank's branch network by presenting goals for growth. The workforce demands that sufficient time should be reserved for talks concerning development of the group's services. Personnel who are surplus to requirements should be employed in the jobs that are understaffed at the moment. Furthermore, it has been proposed that a telephone banking service specialising in serving companies and organisations should be established, which would need an increased labour force. It also proposed that retraining and further training should be intensified.
Immediately before announcing the reorganisation programme, Leonia reported a significant improvement in its financial results. Against this background, the redundancies are "more a question of will than of money", says the executive manager of the organisation of Leonia employees, Erkki Tuononen. The managing director of Leonia, Harri Hollmen, considers the reorganisation decisions as justified: "It is completely clear that these actions are part of the increased cost-effectiveness that Leonia has to bring about." The results of the works council negotiations will be discussed at a board meeting of PTL on 12 June 1998, when the decisions on the possible industrial action will be made.
Eurofound recommends citing this publication in the following way.
Eurofound (1998), Mass redundancies in Leonia finance group, article.
