Job security agreement at Safilo eyewear group

On 11 May 2012, Safilo, one of the world leaders in the eyewear sector, announced its intention to cut 1,000 jobs at its three Italian plants. The decision came after the company, already in financial difficulties, lost its contract to make eyewear for luxury brand Armani. Negotiations with sectoral trade unions resulted in several commitments by the company in its industrial plan aimed at stabilising the business and an agreement to avoid the planned large-scale redundancies.

Background

Safilo, an Italian group established in the eyewear sector for more than 75 years, is based in Padua and is the second largest manufacturer of eyewear products worldwide in terms of turnover. It is a world leader in the luxury eyewear division and is one of the top three sports eyewear manufacturers and distributors.

The Safilo Group operates in about 130 countries and employs more than 8,000 workers worldwide of which 3,480 are based in Italy. As well as its central office, Safilo has production plants in Longarone in the province of Belluno, Santa Maria di Sala in Venezia, and a third in Martignacco in Udine.

The group is currently experiencing financial difficulties, and in the past year its share price has dropped by 65%.

Armani bombshell

On 11 May 2012, the group told trade unions it had lost the Armani licence, which amounted to 20% of the group’s total sales. From 2013, Armani plans to have its eyewear manufactured by Luxottica, another Italian group in the sector. The switch will have potentially serious impact on Safilo’s production levels and sales.

On the same day, the management of the group announced redundancies for approximately 1,000 workers at the central office in Padua and the production plants of Longarone and Santa Maria di Sala.

In order to find an alternative to redundancies, the sectoral trade unions met several times with company bosses, asking them to produce a business plan which would outline the group’s future actions and investments.

The agreement

An agreement was signed on 15 June 2012 by the representatives of the group, by the Unitary Workplace Union Structure (RSU) at Safilo, and by the regional and provincial trade union secretaries of the territories listed below.

  • The Energy, Fashion, Chemical and Allied Industries Federation (FEMCA CISL) affiliated to the Italian Confederation of Workers’ Trade Unions (CISL).
  • The Italian Federation of Chemical, Energy and Manufacturing Workers (FILCTEM CGIL) affiliated to the General Confederation of Italian Workers (CGIL).
  • The Italian Textiles and Clothing Workers’ Union (UILTA UIL) affiliated to the Union of Italian Workers (UIL).

As part of the agreement, the group made specific commitments in its industrial plan which included:

  • making investments of €9 million to be used to introduce new technology;
  • the setting up of professional training programmes in order to make the workers more flexible in their roles and prepare them for the new technologies that will be introduced;
  • the elimination of investments in China, and the reintroduction of production in the Italian plants;
  • the re-hiring of some previously outsourced workers.

The result of these measures has been a reduction in the number redundancies from 1,000 to 790. The number will drop further to 671 by blocking the use of fixed-term agreements and staff leasing.

In order to avoid the 671 remaining redundancies, the agreement proposes the use of a 24-month job-security agreement. This deal would mean a temporary reduction in working hours for approximately 2,200 Safilo workers in order to avoid job losses. The organisation of working hours and shifts will be carried out at plant level.

The resulting reduction in salary levels will be mitigated through the use of an extraordinary wages guarantee fund.

On 18, 19 and 20 June, workers’ assemblies approved the agreement.

Reaction

In a joint declaration, the sectoral trade unions and the RSUs expressed their satisfaction with the agreement, saying the contents ‘mirror the requests of the trade unions and workers who had asked the group to reconsider their position and exclude redundancies’.

Mario Siviero, Secretary of the Femca Cisl del Veneto, said:

The most important part of the agreement starts now. The objective over the next two years is to exploit all the points established in the agreement in order to maximise employment levels and re-launch the production in the Safilo plants.

Vilma Rinolfi, Cesos

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