Solidarity contracts agreed at Telecom in place of collective redundancies
In July 2009, at the Ministry of Labour, Health and Social Policy, Italy’s biggest telecommunications group, Telecom, signed an agreement with the sectoral trade unions, transforming 470 collective redundancies into 1,054 solidarity contracts. This move follows the company’s announcement of its Strategic Plan 2009–2011, providing for 4,000 redundancies. The trade unions welcome the agreement and the company’s effort to save jobs at a difficult economic time.
About the company
Telecom Italia is the largest telecommunications group in Italy and is one of the most important companies in the sector at European level. According to data from Telecom Italia in March 2009, the company currently has 75,499 employees and operates in 15 countries, being particularly influential in Brazil and Turkey. It also offers broadband services in Germany and the Netherlands and manages 50% of the international telecommunications traffic in the Mediterranean countries.
Telecom Italia was set up in 1994 through a merger of five state-controlled companies operating in the telecommunications industry. In 1997, the company was privatised and was quoted on the stock market at the end of that year.
Since then, following hostile takeovers and differing management strategies, Telecom Italia has accumulated debts of more than €35 billion. At the end of 2007, a new management group took over and initiated a restructuring process that includes the loss of a considerable number of jobs.
Restructuring at Telecom
In September 2008, the trade unions and Telecom Italia reached an agreement which, by the end of December 2010, envisages mobility for 5,000 workers who during this period of mobility will reach retirement age. In the settlement, Telecom agreed to integrate the mobility allowance of these workers in order to arrive at 90% of their normal salary; it also agreed to hire 900 people on open-ended employment contracts.
In January 2009, the Telecom Italia Group presented its Strategic Plan for the period 2009–2011 to the trade unions. This plan provides for a further 4,000 redundancies.
Following this plan, in May 2009, the Group announced the redundancies of 470 workers at the company’s call centres. The trade unions opposed this action and requested the intervention of the Minister of Labour, Health and Social Policy, Maurizio Sacconi, who set up a meeting acting as mediator. On 21 July 2009, at the ministry, a meeting took place between Telecom Italia, the unitary workplace union structure (Rappresentanza sindacale unitaria, RSU), the Communication Workers’ Union (Sindacato Lavoratori Comunicazione, Slc-Cgil), the Information, Entertainment and Telecommunications Workers’ Union (Federazione dell’Informazione, dello Spettacolo e delle Telecomunicazioni, Fistel-Cisl), and the Italian Communication Workers’ Union (Unione Italiana Lavoratori della Comunicazione, UILCOM).
After a 24-hour period of negotiation, the parties reached an agreement whereby the 470 anticipated redundancies were replaced by 1,054 employment ‘solidarity contracts’ or job security agreements.
Content of agreement
In fact, two agreements have been negotiated.
In the first agreement, concluded by the trade unions and the Telecom Italia Group, the decisions relate to the organisation of the Group:
- the company has annulled the 470 redundancies announced;
- the number of territorial offices to be closed has been reduced from 15 to 10;
- for the employees of the 10 offices that will be closed, the agreement foresees their transfer to other offices in the same municipality or alternatively in another municipality, but in this case only with the full consent of the worker concerned;
- the transfer of workers to other operative areas will be monitored every six months by the parties involved;
- the training activities for Telecom staff – considered fundamental by both sides ‘for the protection and reconversion of the workers’ know-how’ – will be discussed in an ad hoc meeting between the actors involved in September 2009.
Regulation of solidarity contracts
The second agreement, concluded between the trade unions and the Telecom Italia Group with the mediation of Minister Sacconi, regulates the 1,054 solidarity contracts which will replace the 470 expected collective redundancies.
The job security agreements will be valid for two years, from 1 September 2009 to 31 August 2011. In this period, the actors involved will meet every six months to verify the activities that the company has undertaken to relaunch services and the use of human resources.
Weekly working hours will be reduced by no more than 47% for full-time personnel. Workers on part-time employment contracts will be separated into three categories in this regard:
- those whose working hours amount to 50% of a full-time contract will be excluded from the solidarity contracts;
- those whose working hours amount to 65% of a full-time contract will have their hours reduced by 23%;
- those whose working hours amount to 75% of a full-time contract will have their hours reduced by 33%.
For all of the workers involved in solidarity contracts, seniority and severance pay will remain unaltered. Salaries will effectively be reduced by only 3% due to tax relief and income support measures stipulated in the law regarding job security agreements.
Reactions to agreement on solidarity contracts
The Chief Executive Officer of Telecom Italia, Franco Bernabè, has underlined the effort that the Group has made to ‘guarantee the respect and protection of the workers in a positive negotiation with the trade unions’.
The Secretary General of the General Confederation of Italian Workers (Confederazione Generale Italiana del Lavoro, Cgil), Guglielmo Epifani, has welcomed the agreement, stating that it is the result of ‘the consistency of the trade union during negotiations’. However, he added that ‘the future of Telecom remains problematic as it operates in a difficult market area’.
The Secretary General of the Italian Confederation of Workers’ Trade Unions (Confederazione Italiana Sindacati Lavoratori, Cisl), Raffaele Bonanni, considers the Telecom agreement to be ‘particularly positive’ because it demonstrates that serious crises can be overcome with ‘innovative instruments, which make it possible to protect jobs and for workers and enterprises to cooperate’.
The Confederal Secretary of the Union of Italian Workers (Unione Italiana del Lavoro, Uil), Paolo Pirani, underlines the ‘important social significance represented by the dialogue between the various actors in a time of severe financial crisis’.
Vilma Rinolfi, Cesos