In February 2007, the ING bank outsourced its mail and document processing operations to the new company, Astron. Subsequently, a staff association at the bank appealed to the courts, claiming that Astron, which has also taken over a large number of ING’s employees, does not offer the same terms and conditions of employment as the bank. At the end of 2006, ING, Astron and the trade unions had reached agreement on the transition of around 800 employees due to the outsourcing operation. Following preliminary relief proceedings at the start of March 2007, the courts rejected the employees’ claim, thus recognising the legitimacy of the agreed social plan.
Rejection of social plan
Following the outsourcing of mail and document processing by the ING bank in February 2007, the DockING staff association at the bank appealed to the courts, declaring that the new company, Astron, does not offer the same terms and conditions of employment as the bank. The association represents more than 200 of the 800 employees affected by the bank’s decision to outsource. The preliminary relief proceedings focused on clarifying what the same terms and conditions of employment must be understood to include. The parties involved all agree that the law prescribes that the same terms and conditions of employment must be retained in the event of the transfer of an undertaking. However, questions arise in relation to where primary terms and conditions of employment and fringe benefits end and where incentives begin.
Terms and conditions of employment and incentives
ING’s legal representation draws a distinction between terms and conditions of employment and incentives. An employer reserves the right to modify the latter as they see fit. The case in question involves the issue of access to a study fund or various discounts at different companies. The staff association’s legal representation points out that a profit-sharing scheme no longer exists at Astron and that no discounts are granted in the area of mortgages or for any other ING products. A less favourable pension scheme with higher premiums and share options is also offered to employees transferring to the new company. Moreover, the legal representation for staff asserts that the Allied Unions (FNV Bondgenoten) and the general trade union De Unie misinformed employees by leading them to believe that equal terms and conditions of employment relate exclusively to the primary terms and conditions of employment, meaning the gross salary.
Due to its plan to outsource, ING offered all employees a one-off compensation of between €5,000 and €15,000. This offer was nonetheless refused. According to the staff association’s legal representation, employees stand to lose thousands of euros a year as a result of the bank’s move. In addition, the respective parties all agree that after having joined a new company, the terms and conditions of employment can change.
Agreement on social plan legitimate
At the end of 2006, ING, Astron and the trade unions had reached agreement on a social plan for the transfer of around 800 employees in the area of mail and document management operations. ING is currently in the process of outsourcing the work carried out by thousands of information and communication technology (ICT) specialists and administrative staff. Operations involving the processing of mail and other documents have been transferred to Astron, which will be taking over the transferred employees. This reorganisation plan was announced in November 2005.
Subsequently, a social plan was drafted between the works council and the trade unions, and their membership base. The ensuing contract was then discussed with the members who responded favourably to it. FNV Bondgenoten considers that the trade unions have succeeded in limiting the risks for employees as much as possible in the social plan. Following preliminary relief proceedings at the start of March 2007, the courts rejected the employees’ claim ruling that Astron is not obliged to offer the transferred employees the same terms and conditions of employment in a literal sense. Employees must respond to proposals that are considered reasonable and fair. In reaching its decision, the court recognises the legitimacy of the agreed social plan.
Marianne Grünell, Hugo Sinzheimer Institute (HSI)