Flexibility in exchange for jobs at SEAT

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An agreement was signed in November 1998 between the CC.OO and UGT trade unions and the management of SEAT, which involves increasing production and introducing more flexible working hours in exchange for employment stability and job creation.

The management of the SEAT car factory in Martorell, Spain wants to propose the plant as the best location for the production of a new SEAT model (a shorter version of the Toledo). In order to obtain the approval of Volkswagen (VW), SEAT's parent company, management claimed that it was "vital" to reach a pact with the trade unions to guarantee the necessary increase in production. Management believes that accepting the production of this model will lead to the consolidation of the plant in the medium and long term, because it would mean taking on again the production of SEAT's own models and would also compensate for a possible reduction in production of VW models. The new model is also a car with greater added value, which means greater profitability. The planned increase in production is between 35,000 and 50,000 units per year (at present, 200,000 units are produced).

The production of this model, which is expected to begin in mid-1999, involves an increase in production at a factory whose workers are already working at full capacity. The solution proposed by the company is to increase the use of the plant and this requires greater flexibility in working hours.

Negotiations over an agreement on increased production lasted several months and suffered their ups and downs. They were also held at a time of trade union elections that caused divisions amongst the union sections (even internally). However, in the first week of November 1998, management and the majority trade unions, the Workers' Commissions (Comisiones Obrera s, CC.OO ) and the General Workers' Union (Unión General de Trabajadores, UGT) reached an agreement, with the opposition of the General Confederation of Labour (Confederación General de Trabajo, CGT).

Management agrees to:

• convert 600 temporary workers recruited two years ago into permanent workers;

• recruit 350 new workers;

• recruit another 100 temporary workers - students - on a part-time basis to cover weekends and holidays; and

• set up two commissions to analyse the feasibility of an early retirement plan and an occupational regrading plan.

In return the unions have agreed to:

• increase the holiday period by one month, from July to September, with the company paying ESP 6,000 more per day to workers who take their holidays outside the normal holiday period;

• increase shifts on Saturdays. The same number of Saturdays will be worked but on a three-shift pattern, with five Saturdays paid as overtime and eight as normal hours, and a bonus of ESP 1,100 per day, plus one extra day off;

• work more days per year, by not compensating accumulated hours worked the previous year and continuing to work 80 hours of overtime per worker; and

• reduce by 15% the wages of new recruits graded as "specialists", in exchange for a reduction in the period of service necessary to enter a higher grade (from three to two years).

Although this pact involves greater security for many workers and the net creation of both permanent and temporary jobs, commentators have wondered what happened to the ideas of reducing overtime and working hours (the 35-hour week).