The Netherlands: Multinational companies and collective bargaining

  • Observatory: EurWORK
  • Topic:
  • Published on: 01 July 2009



About
Country:
Netherlands
Author:
Robbert van het Kaar
Institution:

Disclaimer: This information is made available as a service to the public but has not been edited or approved by the European Foundation for the Improvement of Living and Working Conditions. The content is the responsibility of the authors.

The Netherlands had a relatively early start as a home country for MNCs and, more generally, has a long tradition of being a very open economy. A large group of MNCs has its own company agreement, but that there is also a sizable group covered by sector agreement. The proportion of company agreements for MNCs is higher than the national average.Most foreign MNCs seem to have no trouble with the Dutch system of industrial relations. The exception are MNCs based in the USA and Japan, which try to keep the unions out. Instead, they do business with their works councils.

1. MNCs and collective bargaining: basic data

1) MNCs account for a significant proportion of private sector employment in many European countries. Please provide the following information according to availability:

a) proportion of private sector employment accounted for by MNCs, and recent change (e.g. since 2000)

According to the OECD Factbook 2009, foreign owned companies accounted for 24.3% of employment in manufacturing and 12.6% of employment in services. The figure for manufacturing has been fairly stable since 2002.

According to recent research (FNV Formaat, March 2009), there are 102 Dutch-based MNCs that are obliged to install a EWC.

See under 1ac) proportion of service sector employment accounted for by MNCs, and recent change (e.g. since 2000)

See under 1a

2) Please provide any available information on the breakdown of employment in multinationals between foreign-owned MNCs and home-based MNCs

See under 1a. The distinction between foreign-owned and home-vbased MNCs is not relevant in the case of the Netherlands. More than 80% of the shares in all MNcs is foreign owned.

3) What is the level of collective bargaining coverage amongst MNCs, and how does this compare with levels of collective bargaining coverage within the private sector? In the absence of precise figures, please provide an estimate of whether it is higher or lower than the average in:

i) the private sector overall

The level is high (more than 80%). The large majority of MNcs is covered by a collective agreement (sector or company). Main exception are some large US and Japan-based MNC’s, that conclude agreements with works councils.

We compiled a list of companies:

  • Company agreement

ABNAMRO

Achmea

Akzo Nobel

Corus Nederland

Delta Lloyd

DHL Express

DSM (7 CAO’s)

EDS (Hewlet Packard)

Fortis

Getronics PinkRoccade

ING

NXP

Océ

Philips

Rabo

Shell

Unilever

Heineken

Ikea Nederland

TNT (

Vopak

KLM

Solvay

DHL

Maxeda

Aegon

Sara Lee DE

Total

Aegon

Wavin (nu: Owase)

Arcadis

KPN

  • Sector agreements

Aldi

ASML (Metalectro)

Atos Origin (geen CAO)

Campina (zuivel CAO)

DAF (Metalectro)

Friesland Foods (zuivel CAO)

GTI (Metaal en Techniek)

Hewlett Packard (ICK, maar eigen arbeidsvoorwaarden beter)

Makro (METRO) – CAO groothandel in levensmiddelen

Nedcar (Mitsubishi) – Metalectro

Scapino (schoenen)

Stork (Metalectro)

Strukton (M&T)

Imtech (M&T)

GTI (M&T)

Siemens (Metalectro)

Ahold (supermarkten)

Randstad (ABU)

Wessanen (!?, wsch. zuivel)

Heijmans (!?, M&T)

Draka (metalectro)

Energy companies like Nuon and Essent

  • Agreement with the Works council

CapGemini

Esso

Fuji

IBM

Logica

Ordina

ii) manufacturing

See 1.3.i

iii) private services

The level in private services is probably lower, due to the ICT-sector.

4) In countries characterised by multi-employer bargaining arrangements for the manufacturing and/or private service sectors, are MNCs covered by sector agreements? What is the nature of the relationship between MNCs and sector agreements?

a) If Yes, do they mainly conform with the provisions specified in these agreements?

In the Netherlands, multi-employer agreements are dominant. This is less so among MNC’s, a major reason being that among large companies the proportion of company agreements is higher.

Part of the MNCs is covered by multi-employer arrangements, part by single employer arrangements. A relatively large proportion is covered by single employer arrangements, compared to the national average. This group tends to offer better conditions than the sector agreement. There is no clear answer to the ‘nature’ of the relationship.

b) If No, do MNCs conclude their own company agreements? If so, what if any relationship do these company agreements have with the sector agreement?

See 1.4a.

5) In countries characterised by single-employer bargaining arrangements for the manufacturing and/or private service sectors, to what extent are MNCs regarded by other employers as pattern setters for wage negotiations?

Not applicable. The multi-employer level is dominant (although maybe not for MNCs). Within the category of single employer bargaining there used to be a pattern setter history by Dutch MNCs like Philips. This however is to a large extent something of the past.

2. MNCs and change in national systems of collective bargaining

1) To what extent have MNCs been a source of recent change in the agenda and outcomes of collective bargaining in respect of any of the following issues. Please distinguish between manufacturing and private services:

a) payments systems? If so, please elaborate and give examples.

From the mid 1990s onward, home based MNCs (especially Philips) have been an important driving force in introducing and promoting variable pay systems.

b) working time arrangements? If so, please elaborate and give examples.

MNCs have to our knowledge not been of major importance in the field of working time arrangements.

c) flexibility arrangements (other than working time)? If so, please elaborate and give examples.

No information

d) handling restructuring? If so, please elaborate and give examples.

In the Netherlands most restructuring operations do not cause major conflicts. One recent exception was Unilever. Many home based MNCs have elaborated social plans (examples include Corus, Philips, and AkzoNobel ). It seems that many foreign owned MNCs have to a large extent adapted to this ‘Dutch tradition ’.

2) Are any of these changes associated with MNCs headquartered in particular countries? If yes, which countries?

It seems that Dutch-based MNCs are more important in this respect than foreign owned MNCs, if only because of the relative weight in the economy.

3) Are MNCs introducing new issues onto the bargaining agenda? If so, what are these new issues? (Examples might include equality and diversity practices; environmental issues; new employee participation practices; teleworking.)

To my knowledge new issues (like equality etc.) are mainly put on the agenda (their own agenda) by large companies. In the Netherlands, most large companies are MNC’s. However, the issues mentioned are no major issues on the bargaining agenda.

4) Are any of these new issues associated with MNCs headquartered in particular countries? If yes, which countries?

See 2.3

5) In countries characterised by multi-employer bargaining arrangements for the manufacturing and/or private service sectors, what has been the role of MNCs in opening up greater scope for company negotiations? Please distinguish between developments in manufacturing and private services.

a) are company negotiations mainly confined to issues on which sector agreements

i) provide openings and/or a framework?

That depends. About half of the MNCs has a company agreement, the other half a sector agreement. For the latter group company negotiations mainly deal with the Filling in of opening clauses in sector agreements, especially on working time.

ii) establish minimum standards or conditions?

See 2.5.a.i

b) are there company negotiations on issues which are not addressed by sector agreements? If yes, please give examples.

No

c) are there any instances of company negotiations resulting in breaches of provisions in sector agreements? If yes, please give examples.

No

6) In countries characterised by multi-employer bargaining arrangements for the manufacturing and/or private service sectors, are there any recent examples of MNCs:

i) leaving a sector agreement? If yes, please give details.

Yes. In 2001 the collective agreement for the banking sector broke up. All major banks now have company agreements. The initiators all were large Dutch based banks that predominate the banking sector in the Netherlands.

ii) placing new operations or sites outside of the coverage of the sector agreement(s) which apply at existing sites? If yes, please give examples.

No. But there are definitely examples of the other way round. MNCs are trying to outsource activities like catering, transport etc. This means that employees are transferred from an expensive company agreement to a much more ‘cheap’ multi-employer agreement. This has resulted in several court cases.

7) In countries characterised by single-employer bargaining arrangements for the manufacturing and/or private service sectors, is there any evidence of the practice of ‘double-breasting’ by MNCs? (Double-breasting is when companies recognise trade unions for collective bargaining purposes at longer established sites, but not at more recently opened ones.) If yes, please indicate the extent of the practice and provide examples.

No

3. MNCs and the cross-border dimension to collective bargaining

1) Is there evidence of MNCs using comparisons of labour costs, flexibility and performance drawn from company operations in other countries in the course of local company negotiations? If yes, please give examples when answering the following:

i) in which sectors does this typically occur?

No research available

ii) what is the geographical focus of the comparisons (e.g. western Europe, eastern Europe, Asia, worldwide)?

No research available

iii) what is the impact of these comparisons on the outcome of local negotiations?

No information

2) Is there any evidence of threats to relocate operations influencing the agenda and outcomes of local company negotiations? If yes, please give examples when answering the following:

i) in which sectors has this occurred?

To my knowledge, there have been no direct threats But more indirectly, the process of relocation certainly plays a role. However, it probably plays a more important role in discussions with the works council (on investments, restructuring etc.) than in collective bargaining rounds. It is not confined to the manufacturing sector, although there it seems to be more important than in the service sector.

ii) what are the destination countries / regions of the global economy for any threatened relocations?

Eastern Europe, China and (call centres and IT) India.

iii) what has been the impact on the outcome of local negotiations?

No research available

3) Is there evidence of MNCs seeking to introduce so-called ‘best’ practices and/or corporate policies from their operations in other countries in the course of local company negotiations? (This may arise through the use of benchmarking.) If yes, please give examples when answering the following:

i) in which sectors does this typically occur?

No research available

ii) is the process linked to the use of comparisons of labour costs, flexibility and performance or other Human Resources policies (if so, please specify)?

No research available

4) Do MNCs employ significant numbers of posted workers (e.g. amounting to more than 5% of the workforce)? If yes,

i) in which sectors does this typically occur?

No data available

ii) are these posted workers covered by local sector and/or company agreements?

No data available

5) Are there any instances where MNCs headquartered in your country have engaged in transnational negotiations at either European or global levels? If yes, please provide details of the MNC(s) concerned and the issues addressed.

With regard to collective bargaining, no. Framework agreements (which have been concluded by several MNCs) do not cover terms of employment as such.

4. MNCs and the social partners

4a. Employers

1) Are MNCs affiliated to the main employers’ organizations at cross-sector and sector levels?

Most, if not all Dutch MNCs are affiliated. With regard to foreign owned MNCs: no information

2) To what extent are MNCs regarded as key players within the main employers’ organizations at cross-sector and sector levels?

The major Dutch MNCs have been quite influential in the past. Arguably, this influence has diminished.

3) Are MNCs also organized in country-of-origin specific assocations (e.g. American or German Chambers of Commerce). If yes:

Do these associations intervene on industrial relations issues? If yes, please provide details.

Yes. The American and Japanese Chambers of Commerce. There have been examples of intervention (writing letters) with regard to co-determination issues, but not on collective bargaining issues.

4) In countries characterised by multi-employer bargaining arrangements for the manufacturing and/or private service sectors, what influence do MNCs exercise over sector negotiations? For example, how far are MNC personnel involved as lead negotiators for employers’ organizations?

No influence. No involvement of MNC personnel as lead negotiators.

5) In countries characterised by multi-employer bargaining arrangements for the manufacturing and/or private service sectors, what, if any, kind of reforms to sector agreements are MNCs proposing? For example, are they pressing for:

i) limited reform, with modest extension of scope for company bargaining within sector agreements? If yes, please give examples.

In the building sector, employers would like more flexibility in the sector agreement. However, this is not confined to MNCs. As mentioned before, early this century the banking agreement broke up. This was definitely caused by the Dutch MNCs, who now have their own company agreements.

ii) extensive reform, under which sector agreements are confined to establishing either minimum standards or a basic framework governing a few key issues? If yes, please give examples.

See 4.5.ii

6) In countries characterised by multi-employer bargaining arrangements for the manufacturing and/or private service sectors, is there any indication of the advantages or disadvantages that MNCs perceive in continuing to be party to sector agreements?

Unknown

4b. Trade unions

1) How have trade unions responded to the impact of MNCs on the agenda and outcomes of collective bargaining? Please give examples.

The impact of MNCs on sector bargaining has not been very large. The major MNC’s have a company agreement. To our knowledge, there has been no major change in the bargaining process specifically due to MNCs.

2) In countries characterised by multi-employer bargaining arrangements for the manufacturing and/or private service sectors, how have trade unions responded to attempts by MNCs to broaden the scope of company negotiations? Please give examples.

No information.

3) In countries characterised by multi-employer bargaining arrangements for the manufacturing and/or private service sectors, how have trade unions responded to any attempts by MNCs to:

i) leave sector agreements? Please give examples.

The only sector where this happened is banking. The unions have concentrated on getting a good company agreement, and not so much on resisting the process of leaving the sector agreement.

ii) place new operations or sites outside of the coverage of the sector agreement which applies to existing operations? Please give examples.

This is exceptional. The main problem is the process of outsourcing. This results in worse terms of employment, because the former company agreement is much better than the new sector agreement (e.g. for cleaning, catering etc.). Unions have either resisted the outsourcing and, where they did not succeed, in maintaining the former level of the terms of employment.

4) In what ways have trade unions responded to the use by MNCs in local, company negotiations of:

i) comparisons of labour costs, flexibility and performance?

No information

ii) threats to relocate? Please give examples.

There has been one case in the northeast of the Netherlands, where a producer of paper-related products threatened to leave. Some years earlier, this company had received subsidies from the Ministry of Economic Affairs to start the plant. The unions have called on the Ministry to demand a repayment in the case of relocation. More generally, it is in many cases the works councils who conduct the negotiations, while the unions negotiate a social plan. Only where the unions are strong, they try to mobilize their members to fight the relocation itself.

5) Are there instances where trade unions have targeted specific MNCs because of public, media or political interest in their practices? If yes,

i) have they involved political exchange, involving mobilization of popular sentiment against foreign companies as political leverage to gain concessions from government (e.g. the cases of Alstom in France and Alitalia in Italy)? Please provide examples.

Yes, in the case of IHC-Calland (dredging), which was active in Birma/Myanmar (human rights). In the 1970s and 1980s the unions have fought the presence of Shell and outer companies in South Africa.

ii) have new industrial relations actors, such as NGOs, been involved in such campaigns? Please give examples.

Yes, see 4b5i.

6) Are trade unions in MNCs engaged in compiling their own cross-border comparisons of working conditions etc. at sites in different countries? If yes, please give examples.

Unknown.

7) Are national and local trade unions involved in European-level negotiations with MNCs on any issues? If yes, please give details.

Through framework agreements. Mention should be made of the supporting role of trade unions for EWCs in MNCs. However, this support is usually not on collective bargaining issues.

8) More generally, do trade unions have policies aimed at developing the cross-border and European-level dimensions to collective bargaining in MNCs?

To our knowledge, unions are not very active on this issue

5. Commentary by the NC

For purposes of analysis, a major difficulty is to distinguish between the activities of foreign based and home based MNCs The majority of the shares of all large ‘Dutch’ listed MNCs is foreign owned. This is not the case for family owned MNCs, but it is much harder to get figures on this latter category.

In the past, ‘Dutch’ MNCs were trendsetters in collective bargaining. This is no more the case. A major reason is that sector agreements are dominant in the Netherlands, while a major part of the MNcs have their own company agreement.

Robbert van het Kaar (HSI)

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