Restructuring, factory closures and strike action feature in IUF and EFFAT Coca-Cola newsletter

Invalid restructuring plan in Spain, strike in Portugal, successful agreement in Germany and more news from Europe are included in the first IUF-EFFAT Coca-Cola Newsletter.

Coca-Cola Company: The Coca-Cola Company is in the process of merging three business units that are responsible, amongst other things, for communication, marketing and public affairs, into a single unit. The affected business units are Iberia (Portugal and Spain), NWEN (Coca-Cola Enterprises + Coca-Cola Nordic Beverages + Ireland) and Germany. Similar mergers of bottlers in the past have had high social consequences for workers.

Coca-Cola CCE AG (Germany): CCE AG has taken a decision to eliminate the 0.5 L and 1.5 L refillable bottles and replace them with non-refillable ones. The current reusable bottles can be refilled up to 40 times. As a result of this decision, about 1000 jobs may be destroyed in the next two years. Management has said that the 1 L refillable bottles will be kept, but there is a possibility that the company might kill off the reusable plastic bottle system entirely. This may destroy more than 5000 jobs at CCE AG. NGG, which represents Coca-Cola workers in Germany, is strongly opposing this scenario. In the meanwhile, in the 4th round of negotiations that took place from 17th to 19th of March, the NGG wage commission was able to reach some important agreements. Among the more relevant ones, the pay increase of 3.2% in 2015 and the clause that states that "no redundancies will take place without a prior 12-week consultation process or without a works council hearing" deserves a special mention. Other important agreements have been reached with respect to working hours. Please find the English statement of NGG here about the new agreement and its key points.

CCIP Spain: Outstanding issues in relation to closures and dismissals in Spain were subject to discussion and negotiation at the IUF-TCCC meeting on April 15, 2015 in Atlanta while the Supreme Court issued its final verdict on the closure of four Coca-Cola factories in Spain. The Court confirmed the previous ruling of the National Court which declared the Coca-Cola Iberian Partners' (CCIP) restructuring plan announced in January 2014 invalid. According to the Court, CCIP violated the right to strike during the consultation period by supplying products from other functioning plants. Confirming that the company's actions around the closures violated the dismissed workers' rights, the Supreme Court ruled that there was now no need to evaluate other grounds of appeal. The final verdict nullified the closure of the factories and the company is now responsible for payment of back wages of all workers for the entire period. Details of the ruling will become available in the upcoming weeks. Read more here for the background of issues.

CCIP Portugal: Workers at the Refrige plant went on strike on 9 April 2015. The reasons for the strike are as follows: Anti- union activities, threats to workers, attempts to block meetings of the works council, social dumping, request for more labour flexibility and destruction of jobs.

Coca-Cola Enterprise (France): The mandatory annual negotiations on salary increases ended with the award of a total budget of 2.2% increase in payroll (an overall increase of between 0.7% and 1.5%) excluding management. For management, there is a total increase of 2.2%, dependent on achieving targets. There is a redundancy plan affecting finance and cooler services. There is an expectation of a loss of volume given the French economic situation but also due to the delay of signing contracts with customers in 2015. These annual tariff negotiations are finalized and a recovery in volumes has begun. Studies are being conducted to find ways to adapt the operations to produce the volumes required, whilst keeping control of production costs. Following the establishment of a new factory organization (PPP) in 2011 and after 3 years of experience, some adjustments will be made to some services such as the "Upstream Area" and media services. The union has been told that there will be no job cuts.

Coca Cola HBC Italy: CCHBC intends to launch new products, price cuts, a package of investments in communication that will be directed to all channels, from marketing to advertising and new management in 2015. The company announced that in 2015 it would re-launch the range with four new 33cL glass bottles (Coca-Cola, Coca-Cola Zero, Fanta and Sprite), while in retail a price revision will be made to better align with current purchasing power, with particular attention to the main pack of Coca Cola, namely 1.5 L. According to management, even the water Lilia will play a central role in corporate strategy: huge investments will be made in communication. After a drastic diet (with closure of some plants and redundancy of over three thousand employees), a new country general manager from Ukraine, Vitaly Novikov, replaced Sotiris Yannopoulos from Poland. The new company strategy will be to manage the business side through a structure focused on distribution channels and developing stronger relationships with wholesalers: this means that Coca Cola will focus only on the activities in strategic metropolitan areas and rely on wholesalers; but what is the strategy of Coca Cola HBC? In the last three years 2011/13 revenues slipped from 1.48 billion to 1.02 billion, with total losses of 95.4 million. Company's market share has been eroded by 0.4% in volume, however, it was indicated that Coke Zero has gained a point of market share. There is no change in the unemployment situation in Italy. The company's strategy is to not open the front with the unions and in addition the company does not want negative publicity during Expo 2015.

Coca-Cola Belgium: On January 6 2015, the National Works Council was informed about the relocation of the distribution activity from Chaudfontaine production plant to the distribution centers of Heppignies and Hasselt which are fully operated by Coca-Cola Enterprises Belgium. The reason given for the relocation was that Chaudfontaine plant had no room to expand or grow its surface area for the storage of water products which the company foresees growing up to 8% in the coming years. 36 people (blue collars; truck drivers and order pickers, and white collar checkers and some administrative roles) would be affected by this decision. For 26 blue collar workers, relocation to the distribution centers was not a big issue except the increased travel distance from home to work and for the order pickers a change was made from a dayshift pattern to a two shift pattern. The negotiations of the social plan for impacted people were finalized on March 27 and the agreed social plan was in line with former social plans negotiated in earlier restructuring plans, with a few increases on the financial aspects.

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