On 8 January 2007, following strike action and negotiations over a social plan at the end of 2006, workers at the Volkswagen (VW) plant at Forest, located in the Brussels region, returned to work.
In January 2007, work recommenced at the Volkswagen (VW) plant at Forest in the Brussels region, following seven weeks of strike action which had paralysed production at the plant. At issue is the transfer of production of the Golf model to Germany and the announcement of job cuts of almost three quarters of the plant’s workforce. The return to work marks the end of two months’ negotiations with regard to the restructuring of the plant. In total, about 2,000 workers will opt for voluntary redundancy, while around 950 workers will be entitled to take early retirement. However, approximately 2,200 workers will continue to work at the site. The remaining workers will probably be made redundant.
On 8 January 2007, following strike action and negotiations over a social plan at the end of 2006, workers at the Volkswagen (VW) plant at Forest, located in the Brussels region, returned to work.
Tensions had previously been raised following an extraordinary meeting of the company’s works council, called to determine the nature of the restructuring set to take place at the VW site at Forest. Subsequently, on 21 November, the management announced that the Brussels plant would cease production of the Golf car. Instead, production of this model would be carried out exclusively at VW’s two German factories, Mosel and Wolfsburg.
The decision came as a complete shock to workers at the Forest plant. Apart from the Golf model, the Forest plant also assembles the Polo model, but in much smaller quantities. In total, around 4,000 jobs out of an overall 5,400 jobs on the site are to be lost – the equivalent of nearly three quarters of the workforce. The workers reacted quickly following the announcement, immediately calling a general strike throughout the factory. Subsequent negotiations on a social plan for the restructuring commenced towards the middle of December.
Future of plant
According to the trade unions, the future of the Forest plant cannot remain viable with the production of only one model, the Polo. They are convinced that this decision marks the first stage of the eventual closure of the site.
On 23 November, the consultation process began in relation to the proposed restructuring of the plant. The trade unions wanted to obtain concrete and official guarantees with regard to the future of the site. In fact, before drawing up a social plan, the works council is obliged to explore all economic alternatives to restructuring, in order to save as many jobs as possible at the plant. Quite rapidly, the VW management proposed to allocate production of a new Audi model, the A1, to the Forest plant. This project, due to start in 2009, could guarantee as many as 3,000 jobs at the site. During the transition period from 2007 to 2008, the Forest plant would be assigned the production of 84,000 vehicles, which would provide jobs for some 2,200 people.
High redundancy compensation
The initial discussions, as usual, since the drawing up of the Solidarity Pact in 2005, centred on the amount of compensation to be paid to workers who take voluntary redundancy. The Solidarity Pact in fact makes the early retirement system the last recourse for a company planning to restructure (BE0602304F).
An agreement emerged quite rapidly, as the compensatory amounts offered are historically high for Belgium. Workers who leave the company voluntarily will be entitled to receive compensation of one month’s gross wages for each year of service. Thus, the compensation awarded will vary between €29,000 and €144,000. Temporary workers will also receive redundancy compensation of about €25,000. At the same time, 950 workers aged over 50 years will benefit from early retirement.
Given the particularly generous redundancy package, almost 2,000 workers have signed up for voluntary redundancy at the Forest plant. The situation has raised some concerns for the government, since it fears that once the workers have received such a generous redundancy package, they will be slow to return to the labour market to seek a new job.
Commentary
On 5 January, a referendum was held about a possible return to work by the workers remaining at the plant and by those set to benefit from early retirement. Some 54% of the workers voted for an end to the strike. Thus, after seven weeks of work stoppage, production recommenced at the plant on 8 January 2007.
Nevertheless, the atmosphere at the plant remains tense. A small group of about 50 militant workers made an attempt to restart the strike. In fact, a number of problems remain unresolved at the plant, such as those relating to working conditions, wage maintenance and the retention of the 35-hour working week.
Delphine Rochet, Institut des Sciences du Travail (IST), Catholic University of Leuven
Eurofound recommends citing this publication in the following way.
Eurofound (2007), Job losses and restructuring at Volkswagen plant, article.
