Redundancy plan finalised in Opel-GM restructuring

After three months of industrial conflict, the management and trade unions at the Opel-GM car manufacturer in Antwerp reached an agreement on a redundancy plan with regard to the 2,200 workers who have to leave the plant. Some workers can take early retirement, while others can claim a generous redundancy settlement. The generosity of the agreement has raised controversy among the national social partners.

In mid April 2007, Opel-GM (BE0109301F, BE9803229F) announced that production of the next generation of the Astra model would not take place at its car manufacturing plant in Antwerp in northern Belgium. A period of negotiations to determine the future of the plant followed the announcement. These negotiations were flanked by a range of protests and strikes by workers at the plant (see table).

Major events in restructuring process, 2007
Overview of protest activities by workers at the Opel-GM car manufacturing plant in Antwerp, April–July 2007
Date Event
17 April Opel-GM announces that the new Astra model will not be produced at the Antwerp plant. The news was announced at a special works council meeting held in a hotel near the Brussels National Airport in Zaventem.
18 April Limited work stoppage by the night shift in reaction to management’s announcement
25 April Opel workers go on strike when it becomes clear that the downsizing exercise will be greater than expected. The strike will last two weeks.
3 May Three hours’ solidarity work stoppage in Opel-GM’s other European plants
8 May Management announces production of two new car models in the coming years.
13 May After two weeks of strike action and a referendum, workers return to work.
16 May Strike takes place following management statement that they will not pay wages for previous work stoppages; this protest action is related to a trade union information meeting in the plant. After management promises an additional wage premium, workers return to work.
24 May A night-shift work stoppage is scheduled. In negotiations with the unions, the management eases back on further redundancy plans. Nonetheless, only 1,350 jobs at most will remain by 2010. Productions costs will have to be cut by €75 million and the production time for a car will have to be significantly reduced.
25 May After company property was sabotaged during the night-shift work stoppage, the management sends the workers home. Shiftworkers, in particular, fear that they will lose their jobs.
26 May Management announces that the contracts of 450 temporary workers are not going to be extended. During the recent protest actions, some of these workers were involved in damaging computers and cars at the plant. However, these workers will receive some kind of redundancy payment, which is exceptional.
29 May Day of work stoppages, as workers still await the final redundancy figures
31 May Management announces final redundancy figures.
1 June Short protest action during the morning shift in reaction to the previous day’s announcement
13–18 June Protest strike takes place following management’s refusal to answer questions on the content of the restructuring plan, particularly the budget available to start negotiations on the severance agreement Workers return to work after obtaining this information.
1 July Short wildcat strike after a meeting was held outlining the overall effects of the social plan that is to accompany the restructuring.

Source: Belgian national press

Severance agreements finalised

On 17 July 2007, the conflict surrounding the restructuring was resolved when the trade unions obtained a written statement from Opel-GM’s international management guaranteeing the production of two new sports-utility vehicle (SUV) models in Antwerp with the option of a possible third car model in 2009. With this provision, the plant will maintain a production capacity of at least 120,000 cars in the coming years. Nevertheless, the plant will still have an overcapacity of workers. As a result, 1,700 production workers and 180 white-collar staff will have to go, along with more than 400 temporary-agency workers.

On 1 July 2007, the management reached an agreement with the trade unions on the redundancy settlement for the production workers. Some 1,200 workers over 50 years of age can take early retirement and retain between 82% and 89% of their last net wage. In addition, up to 750 workers will be made redundant. Workers who decide to leave the company voluntarily, having worked at the Antwerp factory for at least 25 years, can claim a maximum gross severance payment of €144,000.

A week later, a similar redundancy plan for the plant’s white-collar workers was agreed upon.

Employers critical of agreed plans

The agreement triggered a lot of criticism among employers in Belgium. The former Head of Volvo Gand and newly-elected Member of Parliament, Peter Leyman of the Flemish Christian Democrats (Christen-Democratisch en Vlaams, CD&V), considered the planned redundancy payments immoral. The Federation of Belgian Enterprises (Fédération des Entreprises de Belgique/Verbond van Belgische Ondernemingen, FEB/VBO) described the payments as worrying. It had hoped that what it considered high redundancy payments at VW Vorst in Brussels (BE0701049I) earlier in the year would be a one off event; this has now proved not to be the case. FEB/VBO supported the criticism raised by the metal industry employer organisation, Agoria.

Meanwhile, the Organisation of the Self-Employed (Unie van Zelfstandige Ondernemers, UNIZO) considered that workers were getting the ‘wrong signal’ and argued that the unions should have pressed for alternative employment for the workers who would be made redundant instead of focusing on high redundancy payments. Right-wing political parties used the new agreements to make a plea for a new ‘Generation Pact’, which would contain more stringent rules on early retirement.

Workers and trade unions reacted angrily to this criticism. The Belgian Employment Minister, Peter Van Velthoven – of the Flemish socialist party (Vlaamse socialistische partij, SP.A) – supported the agreement. He believes that it includes sufficient measures to get people back into employment and is in accordance with the provisions of the Generation Pact (BE0602304F). The minister also stated that while many people take early retirement, but they have to remain available for the labour market.

Commentary

In comparison with other restructuring cases in the Belgian car industry, the following observations can be made:

  • the severance payments are indeed high and comparable with German practices, which is the parent country of the companies involved;
  • the redundancy payments for temporary agency workers is a new feature;
  • Belgian metalworkers appear to be becoming more resigned to job losses. Previous restructuring cases (BE9703202F, BE0311305F) were accompanied by large-scale national protests on each occasion. This time, the protest was contained largely to the company itself;
  • doubts about the viability of the Belgian car industry remain (BE0606019I). Nevertheless, in the same month as the Opel restructuring case was finalised, Audi Vorst (formerly Volkswagen, VW) announced that it will recruit 100 new employees in the coming months.

Guy Van Gyes, Higher Institute for Labour Studies (HIVA), Catholic University of Leuven

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