Nestlé European Works Council / Steering Committee Meeting / 7 September 2010

The Steering Committee meeting began on 7 September with a strong message from co-chair Klaus Hoffmann concerning the ongoing conflict in Indonesia. He insisted that it remain a focus for the company and urged that it be resolved soon.  A major topic of discussion at the meeting was remuneration. As a result of numerous interventions at previous meetings about lack of data, lack of information and transparency, the substitution of individual performance-based bonuses for collective wage increases, Nestlé indicated at the NECIC meeting in June that they would give us a presentation on their remuneration policy.

The presentation was about policy, elements of remuneration and criteria as applied to management and other categories of employees NOT covered by collective bargaining agreements. We learned that it is Nestlé’s aim “to remunerate its employees competitively but not excessively”, with the level of remuneration determined based on local surveys of “comparator groups” with the objective of paying up to 25% above the median in a given market. The priority is to distribute salary budgets through individual increases; general increases are to be avoided, “unless contractually or legally required”. Despite efforts to distinguish these guidelines from any which may apply to workers covered by collective bargaining agreements (there was no information given), it is clear that unions will be increasingly challenged by Nestlé’s determination to substitute collective bargaining with individual salary reviews, to avoid providing information which gives negotiators a true and fair view of company performance and substitute this with “compensation surveys” and to introduce performance evaluations and bonuses in factories.

Report from the NECIC Steering Committee meeting in September 2010.