Restructuring plan agreed for electronics giant

In December, following six months of negotiations with the Italian government, trade unions signed an agreement for a restructuring plan for white goods manufacturer Indesit. The agreement was ratified by a referendum, and it outlines the priorities for the company’s Italian plants in innovation and research, management, production reorganisation and investment. Public authorities will use social shock absorbers to support the restructuring programme.

Background

On 4 June 2013, the Italian company Indesit told unions that it would be introducing an industrial restructuring plan to reorganise three Italian plants between 2013 and 2015. The plan includes a €70 billion investment plan to cover product and process innovation to reduce water and energy consumption, and improve recycling and digital technologies. Around 1,400 workers, mainly blue collar, will be made redundant. In November 2013, after several months of unsuccessful negotiations with unions, the company started a collective dismissals procedure.

Following intervention from unions, employers’ representative and local authorities, the Ministry of Economic Development began a mediation process with Indesit, aiming to avoid the employment and economic consequences of the restructuring plan. The government invited Indesit and all stakeholders to discuss possible solutions to save both jobs and production, such as the use of Wage Guarantee Fund schemes, solidarity agreements and mobility schemes to help relocate workers at other plants.

Terms of the agreement

On 3 December 2013 a draft agreement was signed by the Ministry of Economic Development, representatives from the Campania and Marche regions, Indesit, the employers’ organisations Confindustria Ancona and Confindustria Caserta, and unions Fim-Cisl, Uilm-Uil and Ugl Metalmeccanici. Initially Fiom-Cgil did not sign, claiming the agreement would neither safeguard employment nor the plants’ future. However, the agreement was ratified by 79.3% of workers in all unions in a referendum. On 16 December 2013, the agreement was countersigned by the Ministry of Economic Development in Rome, and Fiom-Cgil finally joined the deal.

The agreement deal with the economic and productive situation of Indesit in Italy, which has been threatened by increased competition at the international level and by the severe economic crisis in Europe. It confirms the importance of the group’s Italian plants, in particular for innovation, research and development of all products. All Italian plants will be involved in the reorganisation and rationalisation process which will concentrate high added-value production in Italy and allocate products that are no longer viable in Italy to lower-cost countries such as Poland and Turkey.

The agreement covers the period from 2014–2016, and includes plans for innovations to reduce water and energy consumption by using green technologies and product recycling, and to integrate Indesit’s products with home automation technology. In future years, research and innovation such as this will be the focus of industry in Italy.

Management and governance

The plan also includes reorganisation of the governance and central management systems at Indesit, to achieve more simple, efficient and rapid processes and to reduce costs. The production process will also be reorganised in the Fabriano, Comunanza and Caserta plants, which produce, respectively, ovens and other cookers; front-loading washing machines; and fridges, freezers and gas hobs.

An €83 billion investment plan will support the product and process innovation and reorganisation. Over three years, €43.7 billion will be invested in the Fabriano plants (€11.5 billion in Melano and €32.2 billion in Albacina), €29 billion in Comunanza and €10.3 billion in Caserta.

Reactions of the social partners

The Ministry of Economic Development and the governments of the Marche and Campania regions are committed to supporting the industrial plan and its related investment and reorganisation processes. Requalification and training projects will also be introduced, and a national research and development centre for the sector will be established.

The parties agreed that the company may ask the relevant ministries to use the necessary social shock absorbers, mainly solidarity contracts, to save jobs. The agreement also mentions other tools, such as workers’ rotation schemes, to be used over a period of four months. The company also made a commitment not to start any unilateral mobility procedure until 2018, and to halt the one begun in November 2013.

Anna Trovò, National Secretary of Fim-Cisl, in a statement (in Italian) described the Indesit agreement as an ‘excellent result’, saying that the solid majority of votes in favour of the agreement demonstrates that workers understand how difficult the bargaining process is. She also said that the employees’ mobilisation helped change the company’s plans and led to the withdrawal of the collective dismissal procedure.

Michela Spera, National Secretary of Fiom-Cgil declared in a statement (in Italian) that, despite its opposition to the agreement, the union respects the outcome of the referendum and ‘is committed to finding the best way to safeguard and represent Indesit workers’ interests to prevent any closures and dismissals’.

Lisa Rustico, Università degli Studi di Milano

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