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NOKIA: "SOLIDARITY DOESN'T WORK BY PUSHING A BUTTON"

10.06.2008

Workers and unions were shocked on January 15 when Nokia management announced it would close its plant in Bochum, Germany by the end of June. Nokia had received nearly 100 million euros in government subsidies for the plant and was bound by law to guarantee jobs until December 31, 2007. Fourteen days later, despite it turning a sizable profit, Nokia declared the plant would close.

Text / Norbert Hüsson
Photos / Manfred Vollmer
Translation / Mark Slay

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Margarete Nebe feels like the ground is giving way under her feet. It is Tuesday January 15, 2008, shortly after 9am. Margarete, 46, has just learned that the Nokia plant in Bochum - a town in west-central Germany - will be closed at the end of June. Two thousand three hundred people will lose their jobs! Like in a horror film, thoughts of what awaits her shoot through her mind, "First a year unemployed, then social assistance!" Margarete Nebe, a blue-collar worker and member of IG Metall, has worked at Nokia since 1989.

Margarete had plans - a new apartment, a few purchases. Suddenly that simply disappears. "It's all gone!" She is furious: the decision to close was like a "slap in the face".

Ute Beer, 46, has received the bad news by SMS. At first she thinks, "This must be someone's idea of a joke." Although she is ill, she goes immediately to the plant. She is also worried about the future, "I don't know how I'm going to manage...", she says, her voice failing. In the plant, people are speechless and outraged. Many embrace to console each other, men weep. But Margarete Nebe is a fighter by nature. "We're not giving up. We have to continue!"

Fifty kilometers away in Düsseldorf, the capital of North Rhine-Westphalia (NRW), Nokia holds a press conference. Executive Vice President Veli Sundbäck alleges that the Bochum location is "internationally not competitive". Yet wages account for not even five per cent of the total production cost. The Bochum plant's figures are very definitely in the black. According to the business magazine Capital, in 2007 every employee in production produced a profit of 90,000 euros - thanks to overtime and weekend work. Management and the Works Council had even prepared joint plans to make the plant even more profitable. Only an investment of 14.3 million euros was necessary and it was to be approved by the supervisory board in mid-January. Instead, Veli Sundbäck read out the death sentence for Bochum. Gisela Achenbach, chairman of the works council, is "surprised, shocked and totally depressed". She feels "like in a marriage in which you find out that you have been betrayed for years". Now she wants to "save what can be saved".

Destroying the Bochum location is an "absolute obscenity", says the regional director of IG Metall NRW, Oliver Burkhard. He accuses Nokia of being "greedy for profits" and vows the company's plans would be opposed. Ulrike Kleinebrahm, the president of the IG Metall local in Bochum, announces: "We will fight for the plant and for every job."

The German Social Democratic Party (SPD) in NRW starts up an internet site where people can add their names to the list of those protesting the closure of the Nokia Bochum plant: http://nonokia.nrwspd.de./ IG Metall creates an action platform at: www.igmetall-nokia.de: "No Nokia - Not with Us!"

Over the next few days hundreds of solidarity declarations are received from all over Germany - from the works council of the firm ABB to the works council of the firm ZF Sachs. José Manuel Barroso, the President of the EU Commission, says, "I understand the employees' concerns, and I assure you of our solidarity. Where necessary, we will help." Federal Consumer Protection Minister Horst Seehofer exchanges his Nokia mobile phone for another model. Calls are heard for a boycott of Nokia. IG Metall rejects that approach, saying that boycotting Nokia would not help the employees affected. The illustrated magazine stern publishes a poll: 68 per cent of those questioned say the planned plant closure hurts Nokia's image, and 54 per cent will not buy another Nokia mobile phone.

The German Confederation of Trade Unions (DGB) condemned Nokia's move as "unacceptable" - and demanded more worker participation in order to prevent future corporate decisions geared exclusively to maximizing profits. "We demand that a two-thirds majority in the supervisory boards must vote in favour if plants are to be transferred or closed," DGB states. The economy must put people first. Big corporations, it said, are not just the property of anonymous shareholders; the employees and civil society also have a stake. Nokia wants to transfer its mobile phone production from Bochum to the region of Cluj in Romania. But even Manager-Magazine has doubts as to whether the transfer "was a smart and correct business decision".
The magazine supposes that Nokia must have miscalculated. Precisely because in Romania, Manager-Magazine reports, many international corporations such as Continental had had a "bitter experience", among other reasons due to a labour shortage there. The managers in Continental responsible for the move had since been "completely replaced".

Nokia ignores all the protests. Top management does not react. It is "ice-cold", criticized Finland's biggest newspaper Helsingin Sanomat. Federal Chancellor Angela Merkel intervenes in the conflict by speaking to Nokia chief Olli-Pekka Kallasvuo, saying, "I made it clear that I find the whole communication and related actions around it [the closure] incomprehensible."

Gisela Achenbach, the works council chairman, and Ulrike Kleinebrahm, the president of the IG Metall local in Bochum, fly to Finland to meet with the Nokia Board and speak with Olli-Pekka Kallasvuo. The talks end without result.

On January 22, 15,000 people flood into the Market Square in Bochum in response to IG Metall's call for a demonstration. IG Metall President Berthold Huber calls upon the company to rescind its decision. Huber shouts, "I accuse this global corporation of destroying the existence of thousands of workers and their families out of greed for profits!'' For such an offense, he says, there is "no acquittal". The demonstrators applaud. Among them are many school children, auto workers from Opel, Ford and VW, construction workers, miners and members of the service union ver.di, representatives of all parties and churches. On that cold, sunny day the square was a colourful sea of flags. One banner - alluding to Nokia's advertising slogan "Connecting People" - reads: "Nokia - Disconnecting People". Ulrike Kleinebrahm asks everyone to close ranks, and she is extremely happy. "This day shows that we know the meaning of the word solidarity!" she says.

Nine days after the announcement of its plans to close the Bochum plant, Nokia publishes its 2007 balance sheet: a record profit of 7.2 billion euros, an increase of 67 per cent. Later it is revealed what Nokia chief Olli-Pekka Kallasvuo earned in 2007: 3.4 million euros. The first victims of his corporate strategy were 757 subcontracted workers of Adecco and Randstad, of whom many had been working for Nokia for years - they were simply fired. They were followed by hundreds of employees of service enterprises; Nokia's departure has also cost shipping and cleaning workers their jobs.

On January 30 the European Metalworkers' Federation (EMF) and the European Works Council (EWC) of Nokia meet on the 10th floor of the International Trade Union House in Brussels. Following that meeting, EMF General Secretary Peter Scherrer issues a press release whose first sentence reads: " 'Nokia is no longer a social company', trade unionists acknowledged at today's coordination meeting." And further: "Retracing the way Nokia announced, on 15th January, its intention to close the Bochum site, workers' representatives came to the conclusion that Nokia made a mockery of its obligation to inform and consult its employees in line with the EU Directive on European Works Councils and German law." During the meeting, however, the EWC does not demand that the Nokia Board withdraw its decision to close the Bochum plant. Nika Paukkeri, chairman of the EWC, says that the situation throughout Europe, not just in Germany, must be taken into account. Gisela Achenbach is disappointed - and leaves the meeting early.

What happened? IG Metall advisor Martin Bartmann, a sociologist, offers two explanations: first, the Nokia works council members do not meet very often, and thus they know too little of one another and have not been able to build a basis for confidence. Second, in Scandinavia plant closings are not as controversial as in Germany, since there the chances of finding another job are better.

On the evening of Sunday February 10, almost 7,000 people with burning torches in their hands surround the Nokia plant in Bochum - the "ring of fire" is 3.8 kilometers long. The protest action was called by IG Metall. It is a day of protest by families which began in the afternoon. The parking lot in front of the plant, big as a football field, is full of people. Live music plays from the stage, at the back children frolic on an inflatable castle, in between is a snack booth, several beer wagons and tables with coffee and cakes - the atmosphere is almost that a festival under a clear blue sky. A gigantic banner has been placed on the plant fence reading: "One staff, one city, one struggle". The regional director of IG Metall NRW Oliver Burkhard, assesses the situation and says, "Nokia did not expect this resistance and this solidarity." He warns the top management that they are completely ruining the company's reputation.

The next day Nokia starts up the new plant in the Romanian region of Cluj. The day after that, the Bochum Works Council travels to Finland and presents proposals to increase productivity. Nokia rejects them and insists on closing the plant, but says it is ready, together with the state government of North Rhine-Westphalia, to help new companies locate there and to create new jobs. Four weeks of public pressure have an effect when Nokia accepts responsibility for further development of the location. And the unions keep up the pressure. In the "Helsinki Declaration" the Finnish unions Metalli, TEK, UILry and TU together with IG Metall and the EMF on February 13 state, "It is unacceptable for Nokia top management to announce plant closures and mass redundancies without a satisfactory prior information, consultation and negotiation procedure." That was an "attack on the basic rules of the European social model". The unions demand "a future for the Nokia Bochum workers". On February 20 negotiations begin on a reconciliation of interests and a social plan. In the meantime the state government of North Rhine-Westphalia increases its pressure on Nokia, demanding that the company returns government subsidies of 41 million euros plus interest, bringing the total to 60 million euros. The reason: Nokia has created fewer jobs than agreed.

The DGB's Hans Böckler Foundation commissions an expert report. The result surprises even the author of the report, Hamburg labour law professor Ulrich Zachert, who writes, "In Germany it is possible to close a corporate location substantially faster and at lower cost than in other European countries." Zachert compared ten countries. In most of them the State intervenes much more strongly in cases of plant transfers, for example in Portugal, Spain, France and the Netherlands. Only in Denmark and the United Kingdom do companies enjoy even more freedom than in Germany.

The Federal Statistical Office of Germany has determined that in recent years some 180,000 jobs have been transferred abroad, while 105,000 were created at home, that is only 56 per cent of the lost jobs were replaced. But of the 125,000 low-skill jobs lost, only 37 per cent were replaced. Bottom line: the higher a worker's level of skills is, the better his or her chances are of finding a new job after their old job is transferred away.

"It's done," says Ulrike Kleinebrahm (IG Metall Bochum) on April 8, after the social plan negotiations with Nokia have been concluded. The company will pay 200 million euros to settle the closing of the Bochum plant on June 30 - almost three times what was originally planned. The 2,300 employees affected will receive compensation. After their period of notice, those who so desire can move to a transfer company which will take charge of finding them another job by early 2010. Two business areas are being sold, the auto accessories department and part of software development. That will save 300 jobs. More investors are being urgently sought. Blackberry maker RIM has announced that it intends to create as many as 500 jobs in Bochum - good news for engineers and IT specialists. Oliver Burkhard (IG Metall NRW) says, "We can only be satisfied when all employees have new prospects."
With a brand equity of US$44 billion, Nokia is among the top ten brands. The company accounts for 39 per cent of the world market for mobile phones, and employs 116,378 people. In the first quarter of 2008 its profits rose again - up 25 per cent to 1.2 billion euros. But for the year as a whole the firm expects a decline in sales in the mobile phone sector. As soon as that pessimistic forecast becomes public, Nokia's shares drop by more than five per cent.

RESULTS
What lessons can be learned from the Nokia case? For EMF General Secretary Peter Scherrer, one thing is clear, "Solidarity cannot work by merely pushing a button!" For that reason unions and works councils must cooperate more closely to prevent multinational corporations from playing them off against each other. That is also the view of the General Works Council chairman for Nokia Germany, Werner Hammer. "We Works Council members must get to know each other better and develop more understanding for each other," he says, because what happened in Bochum can happen anywhere, anytime.

Ulrike Kleinebrahm says, "With a new form of struggle we have achieved something - we didn't strike against Nokia, but rather we mobilised public opinion and cast doubt on Nokia's image."

And what about Margarete Nebe and Ute Beer, whom I met three months ago? Margarete sounds depressed, she wavers between the hope of finding a new job and the fear of remaining unemployed. "I'll do anything, it doesn't matter what!" Ute is optimistic and full of drive: she wants to do everything she can to work again. "I don't let it get me down!"

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