"280,000 Nestle people sharing the same vision and commitment"…but not the mega-profits!

Nestlé has announced record sales growth for the first nine months of 2008, well above its long-term targets, and declared: “280,000 Nestlé people sharing the same vision and commitment to operational excellence, selling billions of products to consumers across the world, day after day.” So why aren’t Nestlé workers sharing in the billions in extra profits?

While the company joyfully proclaims that it has beaten its growth targets, share buybacks are on course and profits are rolling in, Nestlé workers are struggling with a management which in many parts of the world claims that wages are not a matter for negotiation. In Perm, Russia, Nestlé refused all collective bargaining over wages, claiming that payment is strictly a matter of…management “discretion”. Challenged by the union on this violation of fundamental rights, Nestlé contended that wage scales were protected by “commercial secrecy”! It took over 6 months of escalating international pressure including IUF action at the OECD before Nestlé would reluctantly concede in June this year that the Perm union does in fact have a basic right to negotiate wages.

Nestlé Unions in other countries are today struggling for the same basic right. In Indonesia the union at Nestlé Panjang is facing harassment and intimidation as the company declares that wage information is “secret” (like they did at Perm). In Hong Kong, Nestle management has said it’s not only secret, but they’ve lost the data for the past 10 years!

In Peru, the National Union of Nestlé Peru Workers (SUNTRANEP) has been trying to negotiate a new collective agreement covering its membership at the Lima factory and the Chiclayo distribution centre since February of this year.

After initially seeking a wage increase to reflect the productivity increases and excellent financial results of the past 5 years, the union adjusted its demands in the face of management’s refusal to accord a real wage increase and is now seeking only to cover inflation – which Nestlé Peru obstinately refuses. Instead, the company intends to apply differentiated wage increases by category – based on wage categories it unilaterally imposed one year ago and is now seeking to have codified in the collective agreement!

The union has been contesting Nestlé’s discriminatory and divisive system of categorizing workers as a violation of Article 23, paragraph 2 of the Universal Declaration of Human Rights, which states, “Everyone, without any discrimination, has the right to equal pay for equal work”. In September, in an outrageous attempt to bypass established labour-management procedures and shift the conflict into the private sphere, management sent letters to the workers at home, urging them to accept the company’s offer of…60 US cents per day! The union is currently on strike after all attempts at mediation have failed to move Nestlé.

In the same October 23 press release announcing huge profits and sales growth the company acknowledges that all this is the result of the hard work of its employees. Missing in the statement is any reference to the tens of thousands of outsourced workers who also contributed to sales growth but aren’t “Nestle employees”. They can share in the vision and commitment but shouldn’t ask for a direct employment contract.

The reality at Nestlé today is that sales, revenues and profits are booming, and workers are being left behind.