New collective agreements concluded at three major Dutch multinationals

In the spring of 1998, collective agreements were renewed at three major Dutch companies: Akzo Nobel, Philips and Unilever. A common feature of the three agreements is that pay increases are above the 2.25% inflation rate expected for 1998. Differences still exist regarding the extent to which the agreements should include training programmes to improve employability.

February-April 1998 saw the conclusion of new collective agreements at three of the Netherlands' largest multinational companies - Philips (electronics), Akzo Nobel (chemicals) and Unilever (chemicals).

In the period preceding the negotiations at Philips, it was clear that management's aim was to incorporate performance-based pay as well as the improvement of workers' "employability" into the 1998 collective agreement (NL9801157N). However, the two-year collective agreement that was concluded in early April 1998 makes no mention of performance-based pay. Philips (with over 40,000 employees in the Netherlands) and the trade unions agreed to settle this in the collective agreement for the year 2000. The parties agreed to a pay increase of 6.5% over the two years - somewhat beneath the unions' original demands which varied between 7% and 8%. The agreement does not contain specific training measures to improve employability. It was agreed that new employees joining the company and current Philips employees switching positions must specify the period during which they will perform their new function. This measure should facilitate job rotation within the company.

At the end of March 1998, management at Akzo Nobel (18,000 employees) offered unions a pay rise of 7% over two years. The unions had demanded a 7.5% increase. The employer's offer was submitted to their members without additional comment from the unions, for a decision later in the spring. The 1998 negotiations at Akzo Nobel were particularly trying. Management had previously offered a 4% pay rise which unions had rejected after establishing that their members were willing to undertake industrial action, although the company is not known for being particularly "strike prone". The negotiating parties also concluded agreements on employee training. The company, which had intended to discontinue existing training agreements (NL9802160F), is now offering individual employees the option to improve their labour market opportunities by financing part of the costs related to vocational guidance.

Since February 1998, employees at Unilever (4,000 in the Netherlands) have been covered by a new 15-month collective agreement. Pay will be increased by 3% in March 1998 and by another 1% in January 1999. Furthermore, performance-based pay will be increased from 3% to 5% of the total. Moreover, Unilever employees are rewarded with a 4% bonus if their division, team or process unit achieves certain set targets. An additional 1% bonus is linked to an improvement in the company's turnover. Moreover, the Unilever agreement funds training costs for all employees. Training sessions can be attended during working hours if this relates to the actual task the employee carries out in the firm. Unilever is considered to be an exception in its inclusion of such far-reaching training measures in its collective agreement.