Industrial unrest ends at Moulinex

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In autumn 2001, Moulinex, the French-based electrical household appliance manufacturer, filed for bankruptcy and was partially taken over by its competitor, SEB, with the planned loss of 3,700 jobs. Workers responded by occupying plants and adopting other hard-line tactics. The conflict ended with the conclusion of an agreement on enhanced redundancy compensation for the workers who will lose their jobs.

In recent years, faced with increasingly stiff competition in a sluggish market, the French-based electrical household appliance manufacturer, Moulinex, has been constantly restructuring. In 2000, it was bought out by the Italian holding company, Elfi, and merged with Brandt, but this was not sufficient to turn the company's fortunes around. In April 2001, the group's debt reached EUR 820 million, while total shareholders' equity stood at EUR 640 million and annual turnover at EUR 2.6 billion. The Novicelli brothers – the majority shareholder through Elfi – were unable or unwilling to recapitalise the company in order to fund a restructuring plan drawn up by the Moulinex chief executive, Patrick Puy. The banks backing the group (Crédit Lyonnais, BNP Paribas and Société Générale) were also less than forthcoming.

On 7 September 2001, Moulinex filed for bankruptcy and court-ordered liquidation seemed in prospect (FR0110106F). A few days later, strike action and employee occupations of Moulinex plants began. The subsequent announcement of a partial takeover by SEB, Moulinex's major competitor in the electrical appliance sector, only caused employees to intensify their action. SEB's takeover plan provides for the redundancy of 3,700 of Moulinex's 5,600-strong French workforce and the closure of the four Normandy plants, located in the départements of Calvados and Orne (Falaise, Bayeux, Alençon and Cormelles-le-Royal) (FR0111103N).

The government took a position on the issue when it was announced that Moulinex was filing for bankruptcy. During a previous major workforce reduction in 1999 at Michelin, the tyre manufacturer (FR9910113F), the government asserted that 'even in a market-driven economy, the government maintains an economic and above all social role'. In the case of Moulinex, it stated that 'solutions must therefore be found to assist the company's employees'. The Secretary of State for Industry, Christian Pierret, called for the takeover of the Moulinex-Brandt group by a 'genuine manufacturer'.

Trade unions representing Moulinex employees also demanded government intervention. The metalworkers' federation affiliated to the General Confederation of Labour-Force ouvrière (Confédération générale du travail-Force ouvrière, CGT-FO)condemned the 'attitude of successive management teams, who continued to base the company on past successes instead of developing a genuine manufacturing strategy'. The French Christian Workers' Confederation (Confédération française des travailleurs chrétiens, CFTC) urged 'the government, regional and local authorities and also the banks and shareholders to choose a buyer with a genuine manufacturing plan'. However, Mr Pierret's plan potentially to redeploy Moulinex-Brandt workers in other companies such as PSA, L'Oréal, Total-Fina-Elf, Airbus, Renault or IBM was met considerable scepticism.

Moulinex workers, who were unimpressed with the manufacturing solutions offered and the partial takeover by SEB, focused their demands on the level of redundancy payments and adopted hard-line tactics. 'Cash or boom' (Du fric ou boum) was the slogan adopted by the 1,026 workers at Cormelles-le-Royal, who threatened to blow up their plant. In November, they even set fire to a shed as an illustration of their determination. Later, the tension spread to Caen and Alençon, where there were clashes during an attempted occupation by Moulinex workers of the offices of of the Movement of French Enterprises (Mouvement des entreprises de France, MEDEF) employers' organisation, resulting in Claude Renault, the spokesperson for the Alençon plant inter-union coordination body, being seriously injured. The unions' tactics were described in the Le Figaro newspaper as 'terror trade unionism'.

The pressure tactics led to the conclusion – though with reservations on the part of the French Democratic Confederation of Labour (Confédération française démocratique du travail, CFDT) - of a final agreement, which was relatively favourable in terms of extra redundancy compensation. Under the deal, two-thirds of employees with over 25 years' service are to receive compensation packages equivalent to the FRF 80,000 (EUR 12,200) demanded by the union. The remaining workers are to receive between FRF 30,000 (EUR 4,600) and FRF 80,000 (EUR 12,200), based on length of service.

MEDEF took the government's resolve to 'assist Moulinex workers' literally and refused to cover the extra redundancy compensation, calling on the government to meet the bill.

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