“I love the smell of subsidy in the morning.
It smells like … a free lunch”
Paraphrased from ‘Colonel William Kilgore’
in ‘Apocalypse Now’
A few months ago, the Dutch former state postal service PostNL passed these lines, due to the unwanted side-effects of the flexibilization of their workforce.
Today, however, PostNL was ‘back with a vengeance’ at BNR Business radio (www.bnr.nl). The company had much better news:
PostNL stated that it is intending to hire 500 people with ‘a distance to the labour market':
- People that received welfare for a prolonged time;
- Physically and/or mentally disabled workers;
In an interview with BNR, CEO Werner van Bastelaar of PostNL stated that the company took this action in order to take its societal responsibility. ‘Expenses were not an issue here’. Of course, they were not...
Here are the pertinent snips from the interview [this and the next featured interview in this article are available behind the link – EL]:
Bastelaar: "The expenses that we make to hire these people, are the same expenses that we would make when we would hire regular mail-deliverers. So, expenses and cost-saving are not an issue here.
We pay amounts that are common in this market and, on top of that, we pay the 'Sociale Werkplaats Bedrijven' to counsel these people.
[Sociale Werkplaats Bedrijven or SWB are the pseudo-commercial branches of the so-called Social Workshops in The Netherlands. These Social Workshops are heavily subsidized general workshops, where disabled workers and other people with 'a distance to the labour market' can get working experience, while being in a safe environment- EL]
The job is and will remain a ‘welfare’ thing, as these people will not receive a direct contract from PostNL. The purpose is to reintegrate people in the labour market, who initially have a distance to it. This distance could either be formed as a consequence of people being long-term welfare recipients or by the fact that people are physically / mentally disabled. Both categories have under normal circumstances little chance for a real job. We do our best to get these people to work again.
PostNL will be guiding these people thoroughly, by using the expertise of the SWB-companies, but we will also set some conditions for them. They must be mentally, as well as physically capable to deliver the mail.
And as a matter of fact, the people that we intend to hire are indeed capable of delivering the mail. Until now, the experiences have been satisfactory; the people are very motivated. The quality of mail delivery probably won't suffer from it."
Well, does that sound great or does that sound great?! Almost too good to be true… and it probably is!
The recent history of PostNL is that of a company which fired a lot of real postmen with fixed contracts, in exchange for mail-deliverers with flexible contracts, who are either paid per item or on a part-time basis.
The following lines are from the earlier mentioned article (see the 2nd link in this article), that I wrote on 5 December, 2012:
In order to keep the company profitable under the deteriorated circumstances for normal mail, the board of directors decided to discharge thousands of the official postmen with fixed contracts and to replace them with flexworkers that worked on a payment-by-the-piece basis.They did so to cut the excess fixed expenses per letter.
This decision caused massive unrest among the fixed contract workers, who suddenly saw their secured future deteriorate. They quite rightly feared the ‘false’ competition of non-qualified, parttime workers (often youngsters), who would receive much lower payments for the same amount of work. Especially for the older, often highly compensated workers their discharge meant often a dismal course to longterm unemployment.
Like I already wrote in this article, I do understand that PostNL tries to cut expenses to stay competitive. When its most important competitors radically cut their expenses, a company has to cut its own expenses, in order to stay in business.
Nevertheless, the negative side-effects of the aforementioned actions by PostNL have been that the older postmen who had been fired, often became unemployed with a grim future of prolonged joblessness ahead. And the new mail-deliverers with their freelance or flex-contracts, stayed behind with a salary that, since then, has often been below the official minimum wage per month in The Netherlands.
Read for instance this article for additional information on the hazards of freelancing and working with flex-contracts, as this is, in my opinion, the nasty flipside of unemployment.
Summarizing: in recent years, PostNL has not exactly been ‘the usual suspect’, when it came to societal involvedness and philanthropy of large companies in The Netherlands. Therefore it would be naive to solely count on the philanthropic intentions of PostNL, when it decides to hire 500 workers with a large distance to the labour market.
The assumption that PostNL does not hire these disabled or ex-welfare workers only from the kindness of its heart, was emphasized in a second interview (see the link behind the first interview for the Dutch-spoken, taped version of this second interview). BNR held it this afternoon with professor Ronald Dekker, labour economist of the Tilburg University:
Dekker: "PostNL stated that these ‘people with distance to the labour market’ have the same costs as regular mail-deliverers, but this is not per sé true. PostNL does not bear any employer’s responsibility for these workers, as the company does not offer them a direct contract.
This strongly reduces the risks of such workers: for instance, they don’t have to be paid during times of illness. Besides that, when such a mail-deliverer is found to be not fit for the job eventually, there will be no lay off-expenses for PostNL.
These risks have been sold off within this contract, without any additional expenses for PostNL. As PostNL doesn't have to pay one cent for these risks, such a contract form is much cheaper than the contracts with regular workers.
It will be great for disabled people and long-term welfare recipients to have such a job, but I have still mixed feelings about it. It is always nice when large companies take their societal responsibility, but in this case the whole construction fits just in too nicely with PostNL’s goal to save loan expenses.
On top of that, it is slightly cynical that PostNL can now hire these disabled people, due to the fact that the company firmly guided thousands of mailmen to the exit, over the last few years."
I had to leave some very interesting sidelines out of the transcript from BNR’s interview with Ronald Dekker. Nevertheless, for everybody who understands Dutch, the whole interview is a 'must-listen'.
Unfortunately, PostNL seems one of those companies, which cause that many of the new flex-workers and freelancers might turn into 'the poor of the 21st century'. People in this situation are called ‘freelancers’, but in reality they are nowhere near of earning a decent salary. A decent salary would include: enough money for pension-building, health and working incapacity insurances, with on top of that a utility ‘for a rainy day’ aka a future without an assignment.
When the contracts of such freelancers will eventually be abolished by their principals, they often stay behind without a penny in savings at the bank.
The same is true for the flex-workers at PostNL, with their parttime contracts. People like these flexworkers must often have two or three jobs to earn a decent salary to live from.
That is a very worrisome development and it will only get worse in the coming years.