Investment contracts: job security and education

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Social partners at national level in the Netherlands have recently recommended investment in the quality of the workforce. Alongside the reduction of working time, the new spearhead for improving terms and conditions of employment focuses on the education of workers. For the Industrial Union affiliated to the Dutch Trade Union Federation (Industriebond FNV), contracts with employers on investment in employment and the education of workers will be a major item on the collective bargaining agenda in the future. The potential significance of this is clearly illustrated in the agreement concluded in June 1997 at Heineken.

Social partners' recommendations

In November 1996, the Labour Foundation (Stichting van de Arbeid, STAR) - a bipartite consultative body consisting of employers' and trade union organisations - published its recommendations on the importance of education to workers, companies and sectors ("Werken aan je werkkring" ("Working on your job"), STAR, November 1996) .

STAR states that an increasingly knowledge-based economy coupled with an ongoing process of globalisation forces companies to capitalise quickly on changing markets and technology. These changes create continually changing occupations and functions, and require a well-trained and flexible workforce. The Foundation concludes that employers and workers have both an individual and a collective responsibility to invest in education and training. For workers, an individual or collective right to education may serve to reinforce their position within the company and in the labour market, but it could also force them to stay at work. Employers are called on to develop company schemes including targets with respect to the (future) education of various groups of workers.

From the social partners, STAR demands a strategy to invest in the quality of the workforce and to improve the employability of workers. It recommends that agreements be reached at sectoral and company level concerning educational policy and facilities. In particular, attention should be paid to the individual rights of workers and the proportional participation of disadvantaged groups.

The amalgamatedFederation of Dutch Enterprises-Dutch Federation of Christian Employers (VNO-NCW) and the Dutch Trade Union Federation (FNV) have both taken STAR's recommendations into account in their 1997 policy documents concerning terms and conditions of employment. More specifically, VNO-NCW recommends that employers offer workers a suitable package to enable them to invest in training and to improve their employability. FNV focuses on a legally enforceable individual right for workers to two weeks off for educational purposes a year without loss of pay. FNV also intends to appoint educational consultants to improve the educational infrastructure at sector level and to stimulate the participation of disadvantaged groups.

Industriebond FNV

Particularly in industry, lower-skilled production workers are confronted with technological changes requiring higher skills, while the participation of these workers in educational and vocational training (8%) is lower than the average (11%). From January to May 1997, the Industriebond FNV conducted a survey and organised several discussion meetings on "work or job security". Several thousand members responded.

On 21 May 1997, the Industriebond FNV conference on future strategic policy concerning terms and conditions of employment, "Greater opportunities collectively", adopted job security based on investment contracts as a spearhead for collective bargaining over the 1998-2001 period. Instead of the term "employability", which is considered to be an employers' notion, the Industriebond FNV uses the concept of "job security". Investment contracts cover the education of workers as well as the development of the company within which they are working. Three types of contract may be distinguished: collective contracts for all workers within a sector or company; contracts for specific groups of workers; and individual contracts with the workers themselves. The contracts may take the form of a comprehensive collective agreement or be restricted to an educational clause in a collective labour agreement.

Clauses on remuneration in collective agreements will have to include room for agreements relating to personal educational budgets, facilities for study and extra allowances over and above standard salaries as a bonus for certificates achieved, as well as improved remuneration for workers with multiple skills. Trade union officials now plan to elaborate the substance of collective agreements on job security, to adapt and innovate vocational training and to develop trade union products and services in the field of education, including the introduction of career guidance and educational consultants. Within them individual company, trade union representatives will be involved in the implementation of investment contracts and will intensify cooperation with the local works councils.

Heineken investment contract

The Dutch branch of Heineken Beer Brewery aims to speed up investments in the application of new technologies and to reshape its organisation through the introduction of teamwork. The new form of organisation will demand higher skills and competencies from its production workers. In 1996, Heineken initiated negotiations with the trade unions on the restructuring process and its consequences for production workers.

These negotiations led to an agreement on the deployment of employees, which was signed on 12 June 1997 by Heineken Nederlands Beheer NV and the trade unions involved, the Industriebond FNV, the Industrial and Food Union affiliated to theChristian Trade Union Federation (Industrie-en Voedingsbond CNV), the Federation of Managerial and Professional Staff Unions (VMHP) and De Unie, which represents mainly senior staff. At Heineken, between 70% and 80% of the workers belong to a trade union, which is quite a high density in terms of Dutch labour relations.

The agreement includes a five-year guarantee of employment and education to all the workers at the breweries in Den Bosch and Zoeterwoude. This covers 2,000 workers with an average age of 41. The starting point is that all current employees will continue to work within the new organisation and will be trained, individually or collectively, for their new functions. All employees will be tested by an external agency regarding their potential to be retrained and redeployed. If deemed unsuitable - that is, where it is thought that the individual may not be able to achieve the necessary qualifications - Heineken's management will ensure that suitable work is found. The agreement carefully describes the path to be followed, as well as the respective responsibilities and consultative procedures for the different actors involved. A proactive committee consisting of two members representing the works councils and two members representing management will discuss the results and offer arbitration regarding possible disputes. Every three months, a consultative meeting will be held at a group level between the trade union officials involved and the management of Heineken Nederland Beheer NV, and every two months, there will be a consultative meeting with the trade unions at a plant level.

Commentary

Whereas the education of workers used to fall primarily under the internal social policy of companies, the social partners have now pushed this theme to the fore. The approach of the Industriebond FNV to conclude investment contracts with employers is of strategic short-term importance when it comes to restructuring plans that could adversely affect the interests of workers. The Heineken contract provides a good example of how to restructure work organisation without the loss of jobs affecting the present workforce. Secondly, it also enables the Industriebond FNV to establish a partnership with the employer at a company level. The question that remains, however, is whether or not the "Heineken model" will, in practice, serve as a role model for other companies considering, for instance, the introduction of new technology or restructuring.

Apart from the good example set by the Heineken agreement, the first 1997 progress report shows that the number of clauses on the education of workers in collective agreements increased slightly in 1996 in comparison with the previous year. (Josee Lamers, HSI)

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