Workers demand higher wages in series of unofficial strikes

A wave of unofficial strikes took place in Belgium between December 2007 and March 2008. The workers involved are demanding higher wages to offset rising energy and food prices. However, employers have strongly criticised the strikes. For their part, the trade unions supported the workers’ demands, but also tried to ease the situation. Meanwhile, the newly-formed government reacted by announcing new tax redemption measures.

Strikes by Ford subcontractors and workers

As part of a series of unofficial strikes between December 2007 and March 2008, one of the first protest actions took place at the Syncreon sub-assembly and sequencing plant, a subcontractor for the Ford car factory in Genk in central Belgium (BE0311305F). The main demand of the strikers was for a wage increase of €1 an hour. Due to the ‘just-in-time’ style of management at the plant, the strike had an immediate effect on car production at the Ford factory. As production at Ford was affected, the workforces of other subcontractors also took part in the strike action, demanding the same wage increase. In some cases, it took only a few hours of strike action before the employer gave in to the demands of the workers. Wage increases of around 4% were awarded, which in some instances were accompanied by bonuses.

These actions were soon followed by a strike held by the Ford workers themselves. The strike was initiated by temporary contract workers on 17 January 2008 and lasted four days. They echoed the demand for a €1 hourly wage increase. However, the main demand of the strikers was for their temporary contracts to be converted into permanent contracts and for a slowing down of production; the latter demand has also led to strike action by workers in the past.

The strike ended with an agreement comprising three main provisions. Firstly, shifts are to be expanded with the introduction of 10 additional workers, while the speed of the production line is to be reduced by 1%. These measures will decrease the workload by an average of 3%. Moreover, the employment contracts of 200 temporary workers are to be converted into permanent contracts. Thirdly, the Ford workers have obtained two gross wage premiums of €500. The two premiums will be paid in April and December 2008.

The recent actions at the Ford plant immediately raised a public debate about the alleged lack of responsibility of the strikers. The Belgian car industry is under significant pressure due to demands of international competitiveness and, in recent years, has experienced major restructuring – for example, at the Opel plant in Antwerp in northeastern Belgium (BE0705029I) and at Volkswagen/Audi in Vorst in east Belgium (BE0701049I). Ford’s European management was quick to express its dissatisfaction with the strike initiatives. The plant’s management and trade unions made a concerted effort to resolve the dispute as quickly as possible. A couple of weeks after the strike action, management and trade unions agreed to make up for the loss in production with additional Saturday work.

Strike initiatives in other sectors

The strikes held by Ford workers and subcontractors motivated workers in other companies and economic sectors to take or threaten strike action. Such initiatives included:

  • a strike by workers at the consumer batteries manufacturer, Duracell, based in the small town of Aarschot in northeast Belgium – the strike took place on 14 February and four days later an agreement was reached between management and trade unions and approved in a ballot by rank-and-file members. In the final compromise, the management promised to pay three one-off wage bonuses of €250 before January 2009. The company will also set up a factory shop, which will sell products of Procter & Gamble, the multinational to which Duracell belongs;
  • a one-day strike organised by trade unions at the waste management company, SITA Beerse – the strike was held on 11 March after negotiations on a possible wage increase broke down. The unions were demanding a one-off wage premium of €1,000 to be paid in June 2008. Talks between management and trade unions recommenced after the strike. Before a pre-announced second day of strike action took place, the negotiating parties reached an agreement. Accordingly, workers will be paid a wage bonus of €400 in June and will obtain a company hospital insurance plan, which covers the extra cost of a hospital visit.

An approximate analysis shows that the strikes were mostly held by blue-collar workers and mainly took place in industrial sectors like the metal industry (Opel, Duracell, Sylvania, Bekaert), textiles (Uco Yarns), the food industry (Maiski, Ijsboerke) and, to a lesser extent, the chemicals sector (BP Chemicals). The wage demands were often accompanied by complaints about increased work pressure and/or flexibility. Moreover, the wave of strikes seemed to be more extensive in the Flemish than in the Walloon region. Although the strikes were not always successful, they generally ended relatively rapidly. An important element of the agreed wage increases was, in many instances, dedicated to the use of the newly-established national regulation on wage bonuses (BE0801019I). This regulation establishes a framework within which companies and sectors can introduce results-based wage premiums under a financially advantageous system.

Strikes generate public debate

The series of unannounced strikes intensified the political debate about the rise in the cost of living and the loss of purchasing power. This debate is related to the existing system of automatic wage indexation in Belgium. Using the argument of international competitiveness and the Belgian labour cost ‘handicap’, employers have for a long time criticised this unique Belgian system. Now, however, they are arguing that this system should be sufficient to compensate for rising inflation. They define the problem of rising prices as partly a ‘demagogy’. Nevertheless, one of the big employer organisations, the Organisation for the Self-employed (Unie van Zelfstandige Ondernemers, UNIZO), has also made a plea (in Dutch) for tax measures, especially for lower wages.

Trade union initiatives

The trade unions turned mainly to the politicians and asked for compensatory measures – for example, tax redemptions, a rise in welfare benefits or price controls, particularly in the energy sector. To this end, they had already organised a demonstration in advance of the wave of unofficial strikes and in the midst of the political crisis at federal level. The latter crisis pertained to the lack of agreement over any government between June and December 2007 due to regional tensions; the dilemma was finally alleviated when the King of Belgium, Albert II, asked the previous prime minister, Guy Verhofstadt, to form an interim government until a coalition could be finalised.

Thus, three trade union groups organised a demonstration for 15 December 2007 in Brussels to back three demands: increased purchasing power (more pay and lower prices), the maintenance of a univeral social security system in Belgium, and the introduction of a more balanced tax situation. The three union organisations involved were the Confederation of Christian Trade Unions (Confédération des Syndicats Chrétiens/Algemeen Christelijk Vakverbond, CSC/ACV), the socialist Belgian General Federation of Labour (Fédération Générale du Travail de Belgique/Algemeen Belgisch Vakverbond, FGTB/ABVV) and the Federation of Liberal Trade Unions of Belgium (Centrale Générale des Syndicats Libéraux de Belgique/Algemene Centrale der Liberale Vakbonden van België, CGSLB/ACLVB). About 20,000 people took part in the demonstration. Ironically, some of the demonstrators were unable to make their way to Brussels due to a rail strike called by the Independent Union of Rail Workers (Onafhankelijke Vakbond voor Spoorwegpersoneel/Syndicat Independant pour Cheminots, OVS/SIC).

Official findings intensify debate

The debate was further deepened by a range of official reports and declarations, which included the following.

  • Contradictory reports (in French) issued by the National Bank of Belgium (NBB) acknowledged, on the one hand, that prices are rising and that the labour share in the national income is diminishing; on the other hand, the reports stated that the situation in relation to price increases is partly temporary and partly an illusion, as some prices (food and energy) are rising, while other prices (for example, of more durable consumer goods) are falling.
  • The Belgian Federal Planning Bureau (FBP) added fuel to the discussion with an announcement (in French, 122Kb PDF) that the agreed wage norm of the intersectoral national agreement for 2007–2008 is likely to be exceeded by 0.9% in 2008.
  • Although not specific to Belgium, the President of the European Central Bank (ECB), Jean-Claude Trichet, took a firm position on 11 January 2008 against automatic wage indexation mechanisms related to rises in inflation. This position received considerable media attention in Belgium.

Government measures

The entire debate was picked up by the country’s newly-formed government, led by Yves Leterme of the Flemish Christian Democrats (Christen-Democratisch en Vlaams, CD&V). Some initial measures were taken by the interim government, led by Mr Verhofstadt of the Flemish Liberals and Democrats (Vlaamse Liberalen en Democraten, VLD) for a third – albeit partial – term from 21 December 2007 to 20 March 2008. For example, the interim government extended the functioning of the so-called ‘oil fund’, which grants a discount to lower-income categories on their heating bill. Moreover, the new Leterme government, in power since 21 March 2008, announced in its government policy statement (in French) its intention to introduce a range of tax redemption measures and to develop an ambitious plan to combat poverty and increase social cohesion. However, the declaration did not refer to the contentious issue of possible price control measures in the energy sector, that is, electricity and gas.

Commentary

The wave of strikes has placed the trade unions in a particularly difficult situation. Sectoral or company collective agreements which deal with wage increases normally also include a so-called ‘social peace clause’. This means that, for the duration of the agreement, trade unions promise not to make additional wage demands or to support these demands through the organisation of strikes. These kinds of sectoral wage agreements were settled in 2007 for the period 2007–2008 (BE0711029I).

The wave of strikes can also be interpreted as a slight deterioration in the country’s social dialogue climate, which has been positively developed since 2006. In the midst of the eight-month political crisis in Belgium, leading figures of the social partners were honouring their own constructive social dialogue practices in spite of the ongoing political impasse. However, after the wave of strikes, comments were raised in the media in relation to the potential damage which could be caused by these strikes to the national wage bargaining rounds, due to commence in the autumn of 2008.

Guy Van Gyes, Higher Institute for Labour Studies (HIVA), Katholieke Universiteit Leuven (KUL)

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