The severity and reach of the downturn is prompting many unions and employee representatives to react strongly against business decisions that threaten adverse effects for workers. The consequences can be extremely uncomfortable, particularly for a sector such as the automotive one, whose output depends on a motivated, hardworking workforce. They may include:  

  • industrial action, wildcat strikes and even physical intimidation (including instances of workers holding managers hostage for short periods of time). Local politicians sometimes back some of these actions, adding to the political dimension and the ‘newsworthiness’ of the event and possibly making it more difficult to resolve;  
  • possible litigation by employee bodies, such as local works councils and European works councils, with the aim of delaying restructuring processes with claims that the employer did not comply with the requisite information and consultation processes;
  • unions and employee representative bodies growing in power as a collective ‘voice’ for employees and seeking more formal recognition rights than might have been pursued in the past; and  
  • difficult public relations implications because even if an employer’s actions are not motivated by the nationality of its workforce some elements of that workforce may see it differently in the current climate.  

Managing the risks carefully and effectively is crucial.  

  • Compliance: ensure your compliance policy is up to date and effectively enforced.  
  • Co-ordination: ensure your in-house legal team is close enough to key business lines and works effectively with human resources. Check that you know about all relevant existing key agreements, both collective and individual.  
  • Communication: this means both internally with employees and their representatives and externally with unions, regulatory/local authorities and the press.  
  • Funding: ensure that any public funding obtained does not interfere with planned measures, which would be the case if, for example, there was a commitment to maintain a minimum workforce.  
  • Redundancies: be careful with selection procedures and carry out consultation properly.