Major dispute at AGC Automotive Europe

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Following the announcement of major redundancies at the AGC Automotive Europe factory in Fleurus in southern Belgium, part of the automobile glass division of the Japanese-owned Asahi Glass, the workforce went out on strike in early December 2004. Management has stressed the necessity of cutting costs, in particular wage costs, whereas trade unions fear that activities will be moved to lower labour-cost countries. The public authorities have intervened and launched a conciliation procedure, but without much success, and the conflict started to spread to the other Glaverbel-Asahi Glass sites in Belgium in mid-January 2005.

Belgium is Europe's second-largest producer of flat glass in terms of tonnage. The glass sector employs some 10,200 people, directly and indirectly. The building sector is Belgium's biggest user of glass (approximately 75%), with the rest going to the automobile sector and some other industrial applications. However, there is twice as much flat glass produced as consumed (particularly in the construction sector), and the sector has undergone successive restructurings over a number of years. In 20 years, a third of the companies and a third of the jobs have disappeared.

In April 2002, the Japanese-based group Asahi Glass bought the remaining shares of the Belgian glass group Glaverbel (it already held 50% of the shares). The Japanese headquarters then decided to restructure its worldwide activities into two strategic divisions, with the first being the flat glass division, based at the Glaverbel headquarters in Brussels and the second, the automobile glass division, based in Tokyo. The AGC Automotive Europe factory at Fleurus, near Charleroi in Belgium's Walloon region, which specialises in the production of automobile glass, is the group’s largest production unit in Europe.

Restructuring

At the beginning of December 2004, the management of AGC Automotive Europe announced a restructuring plan at its Belgian plants, which entails the redundancy of more than a quarter of the workforce between then and the end of 2006 (284 jobs out of a total of a little less than 900). The measures envisaged are intended to refocus activities on the core competences of the company and to put in place a new organisation of working procedures, with recourse to subcontracting for related activities and to temporary agency workers to cater for variations in demand. Excess production will be transferred to other European sites. To accompany this, the management proposes to introduce a system of early retirement and create a training and coaching unit.

The management sees these as measures to safeguard competitiveness through the reduction of wage costs. Luc Willame, the director of the flat glass division, justifies these cuts in employment levels at the Fleurus, Lodelinsart and Seneffe sites with reference to the fact that 'wage costs have become an increasingly large percentage of the price of the finished product, sometimes exceeding 20%', in a sector where 'competition is so sharp that prices are being forced lower by the pressure exerted by the construction companies on their suppliers'. The Fleurus site has already undergone other restructuring processes and 'it is confronted by a lack of profitability, which has meant recurrent losses over the last five years', according to Marie-Ange Dhondt, a spokesperson for the company. The last restructuring process, in 2000, ended up with 300 redundancies.

Dispute

As soon as restructuring was announced, AGC Automotive Europe employees started a strike on 2 December, blocked access to the Fleurus plant, and 'held hostage' a number of senior managers for 24 hours. Trade union delegates from 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) at company headquarters in Fleurus jointly expressed their rejection of the plan, which they consider to be unjustified. In the view of the unions, the company undertook a previous restructuring process in 2000, which has already reduced the workforce, but which does not seem to have produced the expected result in terms of productivity. In their opinion, the objectives put forward by Asahi Glass do not justify the loss of a third of the jobs. According to the delegates, by accepting the reorganisation, they would be condemning themselves to being in the same position in two years time, when further activities will have been moved abroad.

Following the seizure of the managers, the Walloon Minister for Employment and the Economy intervened in the conflict. In order to renew the dialogue between the unions and the management, he called a meeting of an 'emergency committee' and made any negotiation conditional on the release of the members of management. This emergency committee, whose objective is to prevent situations of social confrontation and ensure rapid concertation with the parties in a dispute, was set up following similar action at a company in the region in 2003. The committee was made official in 2004 by the new Walloon government (BE0407301N) through its 'contract for a new future' (contrat d’avenir renouvelé) programme. The emergency committee is composed of the Ministers of Employment and the Economy and top-level representatives of the Walloon Employers’ Union (Union wallonne des Entreprises, UWE), the Union of the Self-Employed (Union des Classes moyennes, UCM), FGTB/ABVV, CSC/ACV and the Walloon Federation of Agriculture (Fédération wallonne de l’Agriculture, FWA). The AGC Automotive Europe cases is the first time that the committee's intervention has been asked for.

Conciliation meetings at the Federal Public Service Employment, Labour and Social Dialogue (SPF Emploi, Travail et Concertation sociale/FOD Werkgelegenheid, Arbeid en Sociaal Overleg) did not facilitate advances in the dialogue at AGC Automotive Europe, since the trade unions refused to negotiate on the basis of the restructuring plan. Under pressure from the public conciliator, company management clarified its intentions with regard to the industrial and social aspects of the plan. The industrial aspect defines the conditions of competitiveness with which the Fleurus factory must comply, in particular through an investment of EUR 9 million. The social aspect remains the same, and the unions fear a shift of activities to sites in lower-cost countries.

In a joint demonstration organised by FGTB/ABVV and CSC/ACV on 13 December 2004, 5,000 AGC Automotive Europe workers and supporters marched in the streets of Charleroi. The demonstrators, who included delegations from other companies in the Belgian glass industry, but also workers from supermarkets and public services, denounced the restructuring process, the relocation of jobs abroad and the loss of jobs in the Charleroi employment area. In order to put pressure on the company, all the companies in the Glaverbel-Asahi Glass group in the region (Seneffe, Roux, Lodelinsart et Jumet) showed their solidarity by going on strike.

In mid-January 2005, the management of AGC Automotive Europe, fearing a deterioration of its plant, opened judicial proceedings to obtain the lifting of picket lines, free access to the site and freedom to move within the factory, together with penalties if this decision were not respected. The court agreed completely with management's argument and it imposed an order to stop people being prevented from entering the factory. The next step in this procedure will consist of applying this order by bailiffs. The unions, despite some differences in strategy, made it very clear that they intended to oppose this order and to reinforce their action. Moreover, FGTB/ABVV decided to give notice of a strike in all the Glaverbel-Asahi Glass sites in the Charleroi region. The restart of contacts between management and the unions, along with the public conciliator, has been postponed until there is a better climate.

Commentary

The very hard fought conflict at AGC Automotive Europe is reminiscent of others, particularly at the Clabecq-Duferco factory in the Hainault area steel sector (BE9707109F), which was also characterised by head-on confrontation between the unions and the employer. As with Clabecq, the current conflict is widely supported by the population in general and the working population in particular, since concern about employment in the area is acute. The whole industrial infrastructure of the Hainault area (mines, steelworks, metalworking etc) has been in perpetual restructuring for the last 20 years. In the AGC Automotive Europe dispute, even though the unions are acting in a united front, certain strategic disagreements are appearing as the conflict drags on. The socialist FGTB/ABVV, which accounts for a majority of blue-collar workers, is a proponent of a hard line. White-collar workers and middle management, represented largely by CSC/ACV, seem to be less committed to such a line. (Enrique Moro, Institut des Sciences du Travail)