Manufacturing Inequality: Precarious Work as Corporate Strategy II

The Nestlé Corporate Business Principles proclaim that “Nestlé regards its personnel as its most valuable asset”, but let’s look at how Nestlé defines “its personnel”.

Nestlé policy, as expressed in the “Guidelines outlining the rules and conditions in the engagement of temporary and other non-regular employees”, carefully distinguishes between 3 main types of “employee arrangements”: regular (full time/part time), temporary (direct hire/third-party agency), and outsourced (in-premise/out-premise). These distinctions have major implications for terms and conditions.

“Regular” or permanent workers, as well as direct-hire temporary workers function under the “direct control and supervision of Nestlé” and are registered in “Nestlé’s official employment documents”. Direct-hire temporary workers “generally [do] not qualify to participate in Nestlé retirement plans.”

As we move to third-party agency and outsourcing arrangements, the inequality deepens. Workers on such contracts are registered in “the Agency’s official employment documents” or the “in-premise/out-premise Contractor’s official documents”. Needless to say, they do not qualify to participate in Nestlé retirement plans.
This is what is on paper. But behind that lies the reality of unequal pay for equal work and discriminatory treatment.

The ever-increasing number of workers who contribute to Nestlé’s growth, often working side-by-side with Nestlé’s “regular” workers manufacturing, packaging, transporting and distributing Nestlé products, but who are not regarded by the company as Nestlé personnel by accident of “employee arrangement” are employed on inferior terms and conditions to the ever-decreasing number of permanent workers and are excluded from most benefit schemes.

Nestlé would try to deny this, pointing out that the Guidelines specify that

– Temporary staff can only be used if it is justified by the temporary nature of the job : seasonality, cases of urgency, temporary replacement, etc.
– Temporary work cannot be continuous, has to be interrupted for a qualified period and is of provisional character
– Temporary work cannot result in unjustifiable differences in employment conditions nor in salary and in social benefits

Following a presentation on this policy to the European Works Council, delegates expressed the view that the recourse to temporary contracts and agency labour was on the rise, temporary labour was being used as a means to cut costs and, clearly, the stated policy was not being complied with.

A survey into precarious labour contracts was carried out by the Spanish unions amongst the Nestlé workforce in May-June 2008. When questioned whether Nestlé complied with Spanish legislation and its own internal Guidelines, union members from different sites replied in one voice, “on the contrary”.

The comments include the following: “more and more often the company uses temporary labour in permanent posts”, “the current situation in our factory could allow for more permanent posts, but instead, temporary workers are hired”, “there are cases of ongoing temporary contracts which could be transformed into permanent contracts because it’s clear these jobs are vital and are filled all year long”, “the company says it’s for special orders that are hard to foresee, but in reality, it’s an excuse for not using permanent workers”, “temporary contracts are more economical because you can put less-qualified workers into higher-qualified job categories without having to pay them the higher wage”.

At the Girona coffee factory, over the course of 5 months, there were 87 contract workers out of a total workforce of 422. That’s over 20%. The plant works council has protested that 40 of these temporary workers are actually in permanent posts; the company concedes to half that number.

At the Sevares baby milk factory, there are temporary workers who have been working there for many years (some since 1988) owing to the illegal practice of continuously renewing contracts.

In La Penilla, on the chocolate and confectionery lines, there are often more temporary workers than permanent ones during peak periods.

The same holds true for a baked goods factory in Italy (Christmas and Easter cakes) where a permanent work force of 160 is flanked by 40 temporary workers in the slow months and up to 500 in the peak production months.

Workers on precarious contracts are not only discriminated against in terms of wages and benefits. Precarious workers in Spain and Italy have no access to bank credits or mortgages and can remain dependent on family members for years – while working for the world’s biggest food company.