IR Notes

The European Commission on 12 April presented a proposal for a directive that aims to amend the “accounting directive” (directive 2013/34/EU) so that multinationals operating in the EU with global revenues exceeding 750 million euros a year are required to publish key information (including the number of employees), on a country-by-country basis, on where they make their profits and where they pay their tax in the EU (see press release). The same rules would apply to non-European multinationals doing business in Europe. According to the Commission, corporate tax avoidance in Europe costs EU countries between 50 and 70 billion euros a year in lost tax revenues. The proposal will now be submitted to the European Parliament and the Council of the EU for adoption. A period of one year will be granted to the member states to transpose the new directive into their national legislation. Europe’s largest employers’ organisation BusinessEurope (see press release) indicated its support for the fight against tax fraud and evasion, but argues that making companies’ financial information public risks “undermining” the EU’s attractiveness as a location for investment. Responding to the different measures put forward by the Commission to combat tax avoidance (see press release), the European Trade Union Confederation supports “the proposal to introduce country-by-country reports to tax authorities from multinationals”. However, it interprets the package differently from BusinessEurope, expressing “regret that the Commission does not propose to make them public. If reports were public, this would allow trade unions, NGOs and other interested parties to take part in the debate on taxes paid by each multinational company in each country where it operates, enabling abusive practices and allowances to be detected.”

• Assistance for former employees of MoryGlobal: The European Commission has proposed to mobilise the European Globalisation Adjustment Fund (EGF) to help 2,132 former workers of the transport and logistics company MoryGlobal SAS in France. The total estimated cost of the envisaged package is 8.5 million euros, of which the EGF would provide 5.1 million euros (see press release).


• Aid also for former employees of the supermarket chain Larissa in Greece: On 25 July, the European Commission has proposed to provide Greece with 6.4 million euros from the European Globalisation Adjustment Fund (EGF) to help 557 former workers of the supermarket chain Larissa to find new jobs, and to include 543 young people not in employment, education or training (NEETs) in the actions planned (see press release)


• Worker involvement: The Executive Committee of the European Trade Union Confederation on 13 April adopted a position paper on a “new EU framework on information, consultation and board-level representation rights“. The new framework would become the single reference on information, consultation and board-level representation for all existing (e.g. SE, SCE) and future (e.g. SPE) European company forms. It would also apply to companies wishing to undergo a cross-border merger, cross-border divisions or cross-border transfer of registered office, to the extent that these operations are regulated by European law.

• Proposal to make working hours more flexible: The government is currently drafting a reform of statutory working time that will allow businesses to benefit from greater flexibility. The legal maximum working week could increase from 38 to 45 hours, on the condition that, when calculated on an annual basis, the average week remains at 38 hours (see ETUI article). Employers also welcome the provision for an additional 100 overtime hours to be allocated that are not recouped, but can be remunerated or saved up (see FEB press release). The FGTB trade union confederation condemns a reform that has been “decided without any social consultation” (see press release). For the largest trade union confederation, the CSC, “the 38-hour week is not for sale. (…) Companies must respond to peaks in activity by employing additional workers and not by demanding that their staff work additional hours on the cheap” (see press release).

• New measures to regulate the posting of workers: The government is continuing with its legislative work aimed at reducing the abuses linked to posted workers. On this occasion, this takes the form of a decree of 7 April 2016 concerning transport companies established outside France. The measures provide for a simplification of procedures – thus, foreign rail, road or river transport companies that intend to post workers have to complete a simple certificate of posting, in French, which replaces the pre-posting declaration. It can be done online and may cover several successive postings over a maximum period of six months. However, other measures are intended to combat fraud, with penalties ranging from 2,000 to 5,000 euros per infringement (with a ceiling of 500,000 euros per employer). For instance, a truck-driver must keep a copy of the certificate with him (if not his employer can be fined 750 euros), together with a copy of his employment contract (failing this, the employer risks a fine 450 euros). The business responsible for posting the employees will have to respect the legal and contractual provisions with regard to minimum wage, working hours, compensatory rest periods and health and safety rules. (See comments from the employers’ organisation FNTR.)

• Demonstration by steel-workers: On 11 April, around 45,000 German steel-workers took to the streets in different cities across the country to defend the future of Europe’s steel industry (see IndustriAll press release).

• Shops to be reopened on Sundays and at night: The Orbán government in 2014 passed a law that banned Sunday and night-time working in the commerce sector. However, the new opening arrangements for shops proved unpopular and the opposition Socialist party gathered 200,000 signatures from citizens, demanding a referendum to overturn the legislation and to revert to the former social and commercial legislation on this subject. In a sudden move, the government decided to repeal the 2014 law of its own accord and to reinstate the old system in order to avoid holding a referendum.

Renault: When the most recent amendment to the Renault group works council agreement concluded in March 2015 was signed, the parties agreed to renegotiate the agreement in line with the requirements of directive 2009/38 instead of making modifications to the initial document by way of amendments that were to be signed only by the trade unions that had been a signatory to the original agreement. Given changes to the scope of consolidation, this obligation imposed under the French law on collective bargaining ultimately no longer made sense. For example, an amendment concerning renegotiation was not to be signed by the Romanian representatives because, when the first agreement was signed, the group was not present in Romania. The new agreement, which in fact reiterates the content of the last amendment, was negotiated by a proper special negotiating body established in compliance with directive 2009/38. The new, more readable, agreement underlines that it is sometimes no longer in company managements’ interests to stick to their “old” agreements concluded under the provisions of article 13 of the first directive on European works councils dating from 1994 which offered a certain flexibility in terms of content, because successive amendments have ultimately brought the content of the initial agreement up to, or even surpassed, the level required by the new directive.

• LafargeHolcim: The global trade union federations continue to apply pressure on the cement group LafargeHolcim with a view to negotiating an international framework agreement. IndustriAll Global Union has joined the BWI and EFBWW to launch an online petition calling on LafargeHolcim to respect workers’ rights and improve health and safety jointly with the trade unions (see press release).

Engie: The management of the French group Engie and the European trade union federations represented within the group (IndustriAll, EPSU and EFBWW) on 8 April signed an important “European labour relations agreement“, whose principle was approved at a meeting of the European works council on 1 April 2015 dedicated to the planned transformation of the group. The agreement, which is concluded for an indefinite period, in particular aims to offer guarantees in connection with restructuring processes. Thus, a social diagnosis conducted jointly with the trade unions will systematically accompany all transformation projects. This will be followed by the negotiation of agreements relating to social guarantees. The parties will set up a fund with a budget of 100 million euros per year to finance training as part of reorganisations. They will establish an ENGIE shared European fund, specifically for Group companies experiencing financial difficulties, for retraining purposes and with an annual budget of 10 million euros. The agreement also provides for measures to support voluntary mobility (payment of a bonus of one month’s gross salary, covering the costs of relocation etc.) and restructuring measures (every employee is to be offered three positions corresponding to his/her profile and personal situation). Related press releases have been published by several trade union federations (EPSU, IndustriAll ) and by the company management.

• Solvay: The management of the Belgian chemical group Solvay (30,900 employees) and Solvay Global Forum on 4 March signed a new agreement on performance sharing for 2016, which follows on from the first agreement of this kind concluded on 27 May 2015. The budget allocated to the plan, which covers all the group’s employees (apart from the French, who have their own scheme) has increased by 20%, going up from 10 to 12 million euros. This year, the incentive award is conditional on the collective achievement of two targets. The first is financial: 4.8 million euros will be distributed to the employees if the REBITDA reaches an initial threshold. The award will be increased in a straight line up to a maximum amount of 9.6 million euros if the higher-level REBITDA target is exceeded. The second goal relates to sustainable development: an additional amount of 2.6 million euros will be paid if the group obtains an average score of 2.2 under the Solvay Way self-assessment scheme; this will represent a 10% improvement in the results compared to 2015. As in 2014 and 2015, the total incentive will be divided on an international scale in proportion to the wage bill in the various countries. The beneficiaries in each country will then receive their bonus in April 2017.

Nomad Food /Findus: The Swedish Food Workers’ Union (Livsmedelsarbetare-förbundet) has organised several demonstrations against the closure of the site belonging to the Swedish frozen foods manufacturer Findus at Bjuv in the south of the country. The closure will cause 450 direct job losses and have a devastating effect on the around one-hundred farmers who supply the factory. In the midst of the “Panama Papers” scandal, the story is far from over: the announcement was made before a general meeting of employees on 31 March by the CEO of Nomad Foods, an investment fund registered in the British Virgin Islands, who travelled to the plant to announce its closure at the end of the year before immediately leaving the country. Afterwards, the Swedish employment minister and several other prominent politicians went to Bjuv to denounce the closure of the site, while the prime minister has filed complaints against Nomad Foods.

• Increased employment rate in the EU: The European Commission on 12 April published its quarterly report on employment. The EU Employment and Social Situation – Spring 2016 Quarterly Review (in English) highlights the increase in the employment rate since 2008, particularly as a result of the rise in the activity rate of workers aged 55-64 , which is linked to raised retirement ages. The employment rate (72.8%) has returned to its pre-crisis level, but with a much wider the gap between countries, from 55% in Greece to 80% in Sweden (see press release, in English).


• Integration of migrants on the labour market: In its annual report on the “World economic outlook”, the International Monetary Fund (IMF) states that “policy actions to support the integration of migrants into the labour force are crucial to allay concerns about social exclusion and long-term fiscal costs, while unlocking the potential long-term economic benefits of refugee inflow”. This entails “minimizing restrictions that prevent refugees from taking up work during the asylum application phase” and “strengthening active labour market policies specifically targeted to refugees”. The report recommends “providing wage subsidies to private employers that hire immigrants” and initiatives to make self-employment easier and facilitate skill recognition.