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Negotiation of restructuring processes at European level and

the role of European Works Councils: the case of the …

European Works Council

IPL/HBS Conference, Turin, March 7th, 2005 – Georg Leutert

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1) Background- Formation of FEWC in 1996

- 16 members, 3 external experts

- Five countries:

- Intense co-operation and exchange with Volvo EWC

- Frequent meetings

- Strong co-ordination/leadership by Select Committee

- Day to day business handled by own secretariat

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1) Background- First negotiations in 1999 (Visteon)

- Formally recognized as negotiating body in 2000

- A total of eight agreements negotiated, thereof two re-negotiated agreements and one in progress

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2) Major agreements- Visteon (2000)

- Background: Outsourcing of Ford’s own supplier plants

- FEWC response: Resolution dated 10 May 1999

- Members decided to delegate conduct of negotiations to FEWC

- Declaration of mutual solidarity Agreement ensured continuity of the plants (sourcing

commitments) Agreement constituted basis for subsequent national agreements

on issues of co-determination in the context of Visteon Still today, the FEWC is keeper to the agreement (as well towards

Visteon)

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2) Major agreements- GFT (2000)

- Background: Integration of Ford’s European manual transmission business into 50/50 joint venture

- FEWC response All employees have remained Ford employees Agreement on forward looking investments Agreements protects plants and ensures their future

development

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2) Major agreements- European Framework Agreement/Code of

Conduct (2003)- Agreement on social rights and social responsibility

signed by Company and Unions- Well accepted by employees throughout Europe- Seems to be one of the few effective instruments we

have in order to conciliate global competition and the European Social model

- Initiative in progress to extend to global scale

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2) Major agreements- IOS (2004)

- Background: Restructuring of Ford’s PD processes by integration into cross-brand PD-operations

- FEWC response- Exclusion of job losses- Re-investment of savings into new products- Employees who require redeployment, due to IOS, will

be provided with the appropriate retraining to ensure their employability

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3) Strategic approach/recommendations

- We have to chase for early information and act quickly

- We have to build strong employee networks for on-going information exchange

- We have to present ourselves as (strong) unity

- We should be in the position to calculate costs on a total cost basis

- We (in the West) should try to be better, not cheaper

- It is crucial to insert clauses for re-negotiation in each and every agreement we sign

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3) Strategic approach/recommendations

- Short-term business policy is fatal but sometimes increases management’s readiness for concessions

- We have to act as “co-managers”, argue the way management does

- If we act too late or if we act against major economic principals we risk to end up with a pyrrhic victory

- We should strictly separate between purely national topics and European topics but always be ready for actions of trans-national solidarity

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4) Conclusions- EWC can be a platform for strong unity/solidarity

among employee representatives- By the way: Has there been more concrete and lived

international solidarity between workers in the past 60 years in Western Europe than some recent cases of EWC show us?

- In MNC’s we just can’t win on our own; we can tackle the problem of competition between production sites if we are decided to go for a fair distribution of the existing production volume and see the benefit of joint action

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4) Conclusions- We risk to die ‘in solidarity’ if our strategy is not

based on a solid business model; current financial and economic performance of automotive manufacturers (except of Toyota) is that tough that we can easily pull the rug out from under our own feet