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Dept of Trade and Industry

Answer

Dr. Julian Lewis: To ask the Secretary of State for Trade and Industry if she will make a statement on her assessment of the relative susceptibility to being made redundant of employees of multinationals operating within the EU of (a) British, (b) Dutch, (c) French and (d) other EU companies. [98252] Alan Johnson: [holding answer 24 February 2003]: Job losses due to restructuring or plant closure are reported all over Europe and recent examples of this include Dresdner Bank, Siemens and Mobilcom in Germany, HP-Compaq and Bull in France, Lucent Technologies in the Netherlands, Fiat in Italy, Alcatel in Belgium, and Santander in Spain. In some cases these job losses are part of European or global restructuring programmes, for example, Alcatel, Ericsson and Nokia. UK firms, like those on the Continent, are subject to legislation implementing the EC Directive on Collective Redundancies designed to protect employees affected by redundancies. This requires consultation of employee representatives before collective redundancies can be made. Consultation must be undertaken in good faith with a view to reaching agreement, and must include ways of avoiding the dismissals, reducing the number of employees to be dismissed, and mitigating the consequences of the dismissals. The detailed rules vary from country to country, for example, some EU countries have more lengthy consultation periods than others. The law in the UK provides greater protection in certain respects than that in other Member States. For example, Finland, Germany, the Netherlands and Sweden do not, unlike the UK, have a statutory requirement for severance pay. And UK law treats workers more equally in the event of redundancy than workers in Austria, Belgium, Denmark, Greece, Italy and Luxembourg where blue-collar workers receive lower levels of protection than white-collar workers. The system in the UK is relatively transparent and the costs involved for employers and the length of the process are predictable, unlike in many other EU countries. The Government believes that firms should not face excessive barriers to making redundancies that add to the uncertainty and time involved in what is a painful process. To do so could deter investment, and result in fewer jobs overall, not more.

Secondary information

Type

Written question

Reference

98252; 400 c423-4W;400 c416-7W

Session

2002-03

Subjects

Conditions of employment Employment EU countries Dismissal Protection Redundancy Multinational companies

Link

View this Written question on www.publications.parliament.uk