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US multinational Bunge, the world’s largest oilseed processor, has announced plans to downsize its Dobrich plant, resulting in the loss of 167 jobs. In June 2007, workers at the plant launched a series of industrial actions in protest at the closure and at management’s refusal to negotiate a redundancy plan with the trade unions. Despite the involvement of the Bunge European works council, the management stood firm on its initial offer and rejected the trade unions’ demands.
US multinational company Bunge Limited is currently the world’s largest oilseed processor and employs more than 25,000 workers in 32 countries. In 2002, Bunge took over the vegetable oil refinery Kaliakra AD in the town of Dobrich in northeastern Bulgaria and also acquired the Kaliakra oil brand. In total, about 204 people work at the Kaliakra plant.
In early June 2007, Bunge unexpectedly announced its plan to close the plant in Bulgaria and move production to Romania. The closure will result in the loss of 167 of the 204 jobs. Bunge will retain only its grain storage facilities, which currently employ 37 workers. This decision comes soon after Anglo-Dutch Unilever, the Bunge plant’s main customer, relocated its Dobrich-based production of the Kaliakra margarine brand to Romania.
The reasons given by Bunge for closing the Dobrich facility included the unsatisfactory financial performance of the Kaliakra plant, the restricted market, and the costs of compliance with EU environmental standards required after Bulgaria’s accession to the EU on 1 January 2007.
On 7 June 2007, a general assembly of the workers at the Dobrich plant was held. The meeting was attended by the leaders of the Federation of Independent Trade Unions in the Food Industry (FITU), affiliated to the Confederation of Independent Trade Unions in Bulgaria (CITUB), and the regional coordinator of CITUB. The workers agreed to set up negotiations and strike bodies in order to play an active role in supporting the demands put to management. During this meeting, it was also agreed to hold one-hour daily strikes. The main points under dispute include the level of financial compensation, the lack of further education and training schemes, and early retirement provisions. Workers issued the management with a notice demanding that they start negotiations to conclude a redundancy programme.
A number of demands were put to company management by FITU:
In response to the trade union’s demands, the company management agreed to the following provisions:
Workers launched protests demanding sizeable compensation in response to the planned layoffs, but failed to reach agreement with management on the amount of the compensation. The Executive Director of Bunge in Bulgaria, Tzvetan Iliev, said that the unions’ demands went far beyond what the company would be able to offer, given its poor financial situation.
On 22 June 2007, the workers organised a one-hour warning strike. As a result, tensions continued to mount over the following days. On 25 June, after the management refused to negotiate in relation to the trade union’s demands, the workers blocked the entrance to the plant, thus preventing management from entering the company premises. After three days of picketing, the workers continued their protest action but allowed the management and the workers who wanted to work to enter the premises.
The strike organised by CITUB received strong support from the local community (including the press and local authorities), members of parliament and the CITUB leadership, as they are concerned that famous Bulgarian brands will end up being produced in other countries.
On 10 July 2007, at the Bunge European works council (EWC) meeting, the management of the Kaliakra plant stated that the company would be standing firm on its offer of compensation for the workers due to be laid off. The company finally decided to compensate the workers who will be made redundant with a sum equivalent to six months’ wages. Only 15 workers who have disabilities or are of pre-retirement age will receive a sum equivalent to 18 months’ wages. The Bulgarian representative in the EWC, Miroslav Marinov, presented the workers’ demands and highlighted the trade union’s campaign to boycott Kaliakra products using the slogan ‘Don’t buy the Kaliakra sunflower oil.’
Coming soon after the Unilever relocation, the closure of the Dobrich plant has raised fears among trade unions of a further wave of pullouts by multinationals that are seeking a cost-cutting consolidation of their production operations.
Nadezhda Daskalova, Institute for Social and Trade Union Research