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Friday, 29 May 2015

‘Captain Entrepreneur’ is on the war path against the labour unions. The employees with fixed or flexible contracts could become the ultimate losers of this war.

The greatest trick the Devil ever pulled
was convincing the world he didn’t exist…

Already in 2013, I wrote my first article about Captain Entrepreneur, the mythical hero of the entrepreneurs and the small and large employers in The Netherlands.

Captain Entrepreneur is a tireless fighter for the interests of small and medium-sized companies, as well as enterprises in The Netherlands. He stands by them and covers their ‘six’, in their eternal battle against the (now languishing) Dutch labour unions and “the legendary ‘inflexible’ Dutch labour market, with its ‘antiquated’ laws regarding dismissals, sickness payments and employee-protection in general”. Well, you know the drill...

As that is the legend to which Captain Entrepreneur refers: the Dutch labour laws are so inflexible and the general employee-protection in case of sickness, involuntary dismissals and other events between employers and employees is so rigid, that large employers and small and medium enterprises “cannot do otherwise” than hiring either free-lancers or temporary workers on short-ranged contracts, without any outlook or guarantee for a fixed job in due course.

The Captain’s personal favorite? It is the zero-hour contract, in which workers are called at the moment that their activities are required. Such contracts are entered into by both parties, without a formal obligation for the employer to grant the employee a minimal number of weekly hours of work! 

This particular contract carries a lot of obligations for the workers and demands the utmost in flexibility on their behalf, regarding unfavourable working hours and odd starting-times, but does hardly offer any certainties for the temporary employees themselves.

And the Captain Entrepreneur’s main argument? 

“Fixed contracts are outdated…; labour unions are outdated...; collective labour agreements are totally outdated and the general young worker neither wants to have a fixed contract, nor believes in the power of labour unions and collective labour agreements anymore”.

And the youngsters and other workers below 30 believe the Captain when he speaks these words. They think that what he says makes sense for them, as they never were used to having a different kind of contract with more certainty in it…

They do not wonder why the higher-ranked staff workers and (executive) management layers at such SME employers and large, quoted companies – the very people who advocate this flexibility on behalf of the lower ranked, younger workers – do have a fixed contract and all the extra arrangements themselves, that they refuse to their company’s low-ranked human capital.

Last weekend, the Dutch Telegraaf printed an interview with three representatives of large employers' organizations in The Netherlands, who are obviously avid worshippers of Captain Entrepreneur:
  • Maxime Verhagen, chairman of the Dutch association of building companies 'Bouwend Nederland';
  • Fried Kaanen, chairman of ‘Metaalunie’: the Dutch assocation of SME
    companies in the metal processing industry;
  • Patricia Hoogstraten, chairman of the national store council, a part of MKB Nederland (i.e. the association for SME companies in The Netherlands).
This interview was a staggering testimony of the misunderstanding and straight-forward disdain among large employers for worker’s rights, the labour unions and collective labour agreements in The Netherlands.

They showed virtually no understanding for the advantages of fixed contracts for both workers and employers and seemed to live in a totally different universe than the young and older workers of nowadays.

Large employers in The Netherlands are absolutely not afraid for massive strikes. And when the Dutch business industry does not get what it needs, the labour unions can kiss their new collective labour agreements goodbye.

With great confidence, the employers push all threats from the labour unions aside. “I’m not afraid”, according to chairman Fried Kaanen of Metaalunie. “Our employees will say: “We ought not to strike at this moment”.

They make clear that they mean business: senior days (i.e. days for elder workers), special surcharges for workers and other privileges from the past should all be abolished. Totally old-fashioned, according to the employers.

The “collective labour agreement brawl” is topical for the current commotion in ‘the Dutch polder”. Many employers reached a deadlock in their arrangements with the largest Dutch federation of labour unions ‘FNV’, which maintains its wage demand of 3% and does not want to discuss the desire of companies, to negotiate a flexible and modern collective labour agreement (CLA).

According to Fried Kaanen, Patricia Hoogstraten and Maxime Verhagen, the FNV labour union is still living in the past. This causes only arguments between employers and the labour union representatives. The supermarkets didn’t arrange a new CLA in two years already and the negotiations in the building and construction industry are going very troublesome. In the metal processing industry, the negotations already blew up skyhigh. So there is a substantial risk for ubiquitous strikes these days.

Verhagen: “According to the FNV, I don’t give anything in return during the negotiations and I’m only battering the CLA. Still, we want a modern CLA with a substantial wage increase. We have an offer at the table of 4%, as long as it leads to a more bespoke collective labour agreement”.

Hoogstraaten:”Officially the negotations have been suspended. In 2012, we started an investigation, together with the FNV and CNV [Christian labour union – EL] into the modernization of the CLA. We were too far removed from one another then. The last months we only spoke about the mandatory adjustments within the pension arrangements”.

Interviewer: "But the CNV wants to talk again about the supermarket-CLA?!"

Hoogstraaten:”We are always prepared. However, when you enter into negotiations, you should not repeatedly pick up the old CLA booklet and state: ‘page 1, sixth sentence from the bottom; there we are going to change two bullets'. 

Look at the current society. Our industry is not the industry anymore that it used to be thirty years ago. And the employee who walks around there, is not the employee of thirty years ago either”.

Verhagen: “In 2008, there were 170,000 people involved in the construction-CLA. Now that is 99,000. Many people started to work as freelancers. The CLA is deflating because of that. A freelancer is keeping €4,000 more in hand at the end of the year than somebody with a fixed contract. 

That is caused by the fact that he does not have to pay for all the arrangements, that he is not going to use after all. So also the employees increasingly state: “I don’t want such a CLA. With that, I have to pay for days off for elder workers; an arrangement of which I am never going to make use".

Interviewer: And how did the FNV act in the metal processing industry?!

Kaanen: “I had the feeling that the FNV had a second agenda that we hardly knew. I think it has started one year ago: the FNV simply wants to have 3% more wages, whatever it takes! We made a decent offer, in my opinion. By the way, 99% of our grassroots still thinks there has to be a CLA. But not at any price”.

Interviewer: “All of you three think that the CLA is becoming a blast from the past. But what does this particular time require?!”

Hoogstraten: “Our CLA is from the time that the shops were open 52 hours per week at max. On weekdays these supermarkets were open between 8 and 5, on Saturday just a little and not at all on Sundays. Today’s consumer requires that we are open much longer; until as much as 80 hours. For all these extra demands we need a large, flexible shell of workers. Our workers are adapting to that. And our labour terms need to be adjusted to that.

It is inevitable. On a Friday night we need a lot of people. Yet, you don’t need these people on a Monday. That is the reason that we have two categories of workers. Fixed employees who want to make a career in the industry. And many youngsters who see this as a part-time job. Both these categories have different demands and that should be translated in the terms of labour.”

Interviewer: “The labour union thinks that many of your modernizations are actually deteriorations”.

Hoogstraten: “What on earth are exactly those deteriorations? 

When somebody works at the moment that he wants to work. For instance in the evening or in the weekend, when his partner is at home and looks after the children. Then this person is not working at an inconvenient hour, isn't he?! Why on earth should we then still pay that inconvenience surcharge?!”

Verhagen: “And what we want are: individual choices for education, days off etcetera. I don’t know what is bad about that?! What does the labour union then want as a modernization of the CLA, for crying out loud?!”

Interviewer: You won’t back down in this matter? You do want to make a combined effort in the renewal of the Collective Labour Agreements?!

Kaanen: “We have a lot of arrangements with the FNV. Yet, there is a red line for that, which the FNV should not cross. When there is true annoyance, there will be a climate – also among politicianss – in which critics become sick and tired of all the b*llsh*t and tell us: stop with that. We don’t want it anymore. That could spread all over our grassroots.”

The mysterious character Verbal Kint in the renowned movie 'The Usual Suspects' – a majestic role of actor Kevin Spacey – made this famous quote: “The greatest trick the Devil ever pulled… was convincing the world he didn’t exist…”

I had to think about this quote, when I read this revealing interview (in my opinion a must-read) with these representatives of large employers' organizations. 

Their opinions and arguments do all sound quite reasonable for the uninformed listener and most of these quotes do definitely carry a sense of truth. Nevertheless, what I miss in their quotes is a sign of compassion and understanding with respect to their workers, as well as the labour unions. Everything they said was from their own point of view and from that alone.

There was no sign of compassion and understanding for workers, who had to deal with years and years of wage restraint and massive job loss, during the last decade. Or for workers who saw their legal position on the labour market deteriorate, due to the fact that it became virtually impossible in many positions to acquire a fixed contract.

Especially in the construction industry, many young workers became a freelancer at gunpoint, if they wanted to keep their job or assignment. While the reasons for it were quite understandable from the employers’ point of view, the employers should also understand that this meant a very uncertain future for many of those involuntary freelancers, who on top of that had to deal with fierce competition from East European workers. 

And perhaps these employers should also think about the youngsters working in supermarkets, who have entered into a very uncertain zero hour contract: they must be ready to work for their temporary employer at any time, while still getting a quite poor hourly wage.

If you take the surcharges for inconvenient hours away from them, they almost keep nothing, as far as their wages are concerned. 

Or do Messrs Verhagen and Kaanen and Mrs. Hoogstraten really think that working on Sunday morning at five o’clock is convenient for anybody?! Or Saturday evening at ten o’clock?! Or people not having the chance to spend time in the weekend with their loved ones, because one of them is always working?! Please think again then.

And it might be true indeed that the wages in a supermarket are 20% to 30% above the ‘legal minimum wage’, but let the employers please be honest and tell you that this is probably the minimum YOUTH wage. The follow snippets come from an earlier article:

Yesterday, my dear neighbour told me that her 17-year old grandson had to work long and hard hours in the supermarket, in exchange for very low payment; sometimes even without having a break during six or seven hours of working. And the foreman of this kid still had the nerves to complain that he worked too slow.

As the boy had a zero hour contract without any formal rights, he had to hope and prey every week that his supermarket had some work for him to spare. The “salary” this kid earned, was €3 per hour. This is roughly the same hourly fee as I earned 30 (!) years ago, as a “professional” dishwasher. However, the purchase power of this boy’s money is a fraction of what it was in the eighties.

One remark of Maxime Verhagen in the aforementioned interview comes especially in mind to me: “And what we want are: individual choices for education, days off etcetera. I don’t know what is bad about that?!”

Everybody who is used to working in projects, knows that deadlines are sacred. 

If only employers would rule in the world, there would only be holidays and time off for education during non-working days or idle time. Not during project times.

Yet, when someone has children at school, he knows that he can only go on vacation during the holiday season. And that he has often only time for studies and courses during working days... Project or no project and time or no time. 

Unionized workers and especially workers with fixed contracts know what their rights are and have the tools to enforce them, without the risk of losing their job immediately. 

Freelancers on the other hand only think about their assignment with their temporary employer and their desire to keep it at all costs. The latter does not yield a equal position for negotiations with their temporary employers.

And especially in these hard times, employers want their employees to vanish into thin air when there is no work, only to return when there is work to do again, as I stated a few weeks ago:  

Extra hours? Working during the weekend?

“No problem, you got it, sir! And sir, you pay me so much money for my normal working hours, that I just don’t want to receive the payment for all the extra hours I make for you. I know I am already expensive enough for you, so I will gladly save your company the extra buck”.

And when the economy would decline, those loyal and flexible workers would vanish into thin air, like they never existed, only to return in full force and shape when the economy would start to grow again.

“Glad to be back, sir. How can I be of service?”

While many executives and self-acclaimed leaders at large employers praise themselves for their exceptional qualities and skills, and use this as an excuse for their exceptionally high remuneration, they don’t really search for exceptional qualities among their personnel.

The ideal workers are people, whose knowledge and skills would always be fully up to date. They would not be overly ambitious and would never become bored of their jobs, even when their jobs would be boring, as a matter of fact.

Yet, education and additional courses and trainings are a very serious thing for (freelance and temporary) workers. When they don’t follow those in their spare time, their knowledge and skills become outdated soon. And having outdated knowledges and skills mean ‘no assignments’ for freelancers. So there must be enough time and opportunities to do such courses and trainings.

Yet, the latter does not seem to be the problem of the temporary employer. This is the reason that freelancers are increasingly becoming in a poor negotiating position, as employers are not involved in their education and always seem to choose for the cheapest and most favourable solution... for themselves.

Professor Henk Volberda of the Erasmus University (with a chair in Enterprise Policy) argued in Het Financieel Dagblad:

‘The Netherlands has great ambitions with respect to working more years before retirement and getting used to life-long education. Yet, one sees very little of that in practice. We have excellent primary and secondary education and we invest much in youngsters, but this learning path stops immediately at the beginning of their career. This in contrary to the Scandinavian countries.

As a consequence, Dutch employees are not able to keep their knowledge and skills at level, causing them to land at the sidelines early in their career. After 55, they are participating in the labour market very poorly, in average. Unemployment is extremely high in that category of workers. Only few Dutch 55-plus workers will participate in the labour market until they become 67.

The will to invest in human talent is missing among employers, as well as employees, and there is no fiscal stimulus for that anymore. And at the same time the need for additional education grows: the half-time of professions and skills decreases at lightning speed, under pressure of technological breakthroughs and automation.

In the meantime, the demand for flexibilization is soaring. Certain industries, like hospitality, food and beverage, need this inherently, but this demand for flexibilization also happens in the financial industry, logistics, healthcare and government. 

This bothers me. Short-term thinking rules. Companies consume ready-to-order talent, but don’t feel responsible for their education anymore. When someone better comes along, they simply abandon their old worker. In the long run, this has a destructive influence upon the Dutch knowledge economy”.

I totally agree with this professor and I couldn’t have said it better myself; as a matter of fact, I said about the same in my aforementioned article. 

And so this war between Captain Entrepreneur and the Labour Unions could cause the most casualties among the fixed, temporary and freelance workers, who seem to become neglected by their employers and don't feel represented by the labour unions anymore. 

Their employers forget to invest in them and they forget to invest in themselves. And that is a pity!

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