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U.S. Fuss Over Plant-Closing Notices Puzzles Europeans

May 1, 1988

LONDON (AP) _ The debate in Washington over a bill requiring a company to give 60 days’ notice before closing a plant puzzles people in Europe, where such measures are woven into the fiber of national welfare systems.

″I can’t remember the subject being discussed in the 10 years I’ve been working here,″ said Keith Faulkner, spokesman for the Trades Union Congress, the umbrella movement of British organized labor.

″I don’t see what’s the big deal,″ remarked French economist Bernard Ewenczyk, a specialist in company bankruptcy law. ″It’s not an issue here.″

Washington has debated a clause in the trade bill that would require many employers to give workers and local authorities 60 days’ notice of plans to close a plant or lay off large numbers of people.

President Reagan promised to veto the bill, which was passed by Congress. He and pro-business lobbies say the bill would lead to government interference in the market and hamper competitiveness in world trade.

But union and management representatives in several European countries sounded surprised that anyone would deny workers the right to be notified that they will lose their jobs.

Even in Britain, where Prime Minister Margaret Thatcher is busy stamping her free-market, anti-union doctrines into the social fabric, at least 90 days’ closure notice must be given by a plant employing 100 or more people. For workforces numbering between 10 and 99, 30 days is needed.

″This notice is obligatory all over Europe,″ said Carlos Liebana, a spokesman for the European Economic Community’s social affairs commission. ″It’s a very common thing. ... It can be 30, 60 or 90 days, but the principle of giving notice is universal.″

West Germany and France do not set specific periods for notification, but their procedures are so complex that a company seeking to close down can expect to wait months to shut the gates.

The same goes for Sweden, where ″even the most clear cases will take months,″ said Jan Nordin, a senior Employers’ Federation official.

Martin Oertel, a spokesman for IG Metal, West Germany’s largest union, said: ″It would be inconceivable for someone to simply close a plant here. It would be seen as anti-social and inhuman.

″No major action could be taken here without the relevant unions’ knowledge and cooperation.″

In July 1986, the Michelin tire giant closed its Belgian plant without warning as two out of three shifts were away on summer vacation.

The reaction was universally vehement. Workers occupied the plant and authorities pressed Michelin to keep it in operation. Michelin refused but compensated every worker with at least six months’ pay.

Such compensation is fairly normal in Europe. In France, for instance, laid-off workers get 75 percent of their gross salary for 14 months, and for another 14 months if they can prove they have looked hard for another job.

The money comes out of the social security fund, and this, says Ewenczyk, is the real problem. In times of high unemployment, the social security fund can’t cope with the drain.

In the past, French companies had to justify closings before shutting down, and the bureaucratic tangle could be crippling.

Prime Minister Jacques Chirac’s conservative government has made attempts to help smaller businesses by doing away with that requirement for workforces numbering under 10 workers, and Britain has enacted a similar change.

But Chirac has introduced a new rule: companies closing plants have to train workers for other jobs or help them open their own businesses.

″The situation in the United States is much rougher,″ Ewenczyk said. ″Here it is felt that if a company has to close, it has some responsibility (to its workers). ... It’s a very European point of view.″

In Britain, the opposition Labor Party has outlined a demand for companies not only to notify workers of a closing but to justify it to an independent body.

But among various groups questioned, none expressed any dissatisfaction with the existing laws on notification.

In Paris, a spokesman for the French Federation of Workers said the union was relatively happy with the present situation.

″What is happening in the United States is the reaction of a conservative economic policy that does not give proper consideration to workers,″ he said, speaking on condition of anonymity.

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