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RETRENCHMENT AT UNILEVER?

posted 3 Jun 2019, 12:46 by Gerry Kangalee   [ updated 3 Jun 2019, 13:14 ]
For months, rumours have been running rife that Unilever Caribbean Ltd. (UCL), popularly still known as Lever Brothers, was organising to once again, retrench workers in the Champs Fleurs based transnational corporation. On the weekend of the 25th and 26th May 2019 a notice published by UCL in the daily newspaper added muscle to the rumours.

The notice stated that at a board meeting held on Tuesday May 21st 2019 it was resolved to “initiate a consultation period with the Oilfields Workers Trade Union, to discuss the most suitable option to improve the sustainability and profitability of the company. “

It went on to say “This notice is published pursuant to Section 64(1) [b] of the Trinidad and Tobago Securities Act 2012”. Bells are beginning to ring aren’t they?

What does the Trinidad and Tobago Securities Act 2012 say in section 64 (1) [b] that would have a bearing on the likelihood that UCL has decided to go on a retrenchment drive? (VERP? VSEP? ...a rose by any other name...it’s still workers on the breadline).

The aforementioned section states: “where a material change occurs in the affairs of a reporting issuer, the reporting issuer shall— (b) forthwith, and in any event within seven days of the occurrence of the material change, publish a notice in two daily newspapers of general circulation in Trinidad and Tobago or as otherwise prescribed and such notice shall be authorized by a senior officer and shall disclose the nature and substance of the material change;...”

How does the Act define a “material change”? It states a: “material change” means— (a) when used in relation to an issuer other than a collective investment scheme, a change in the business, operations, assets or ownership of an issuer, the disclosure of which would be considered important to a reasonable investor in making an investment decision...”

The fact that the notice speaks to consultation with the Oilfields Workers Trade Union (OWTU), the recognised majority union of the workers, suggests that the consultation spoken of is in relation to “a change in business operations”, to use the language of the Securities Act.

It would be reasonable to assume that a change in business operations that would trigger a consultation with the recognised majority union would impinge upon the terms and conditions of the workers represented by that union. Interestingly this term “consultation” as it applies to employer and union is spoken of in another Act that directly affects workers terms and conditions of employment. That Act is the Retrenchment and Severance Benefits Act.

According to section 5 of the Act “an employer may, prior to the giving of formal notice in writing of retrenchment, enter into consultation with the recognised majority union with a view to exploring the possibility of averting, reducing or mitigating the effects of the proposed retrenchment”.

This website understands that the company has already written to the union suggesting dates for the “consultation” and that the company is arguing that there has been a downturn in the company’s operations over the last few years and that the way the company has been operating is no longer sustainable. Industrial Relations practitioners are agreed that retrenchment is in the offing.

It has even been put forward that the company has hired Zatopek Solutions, a company owned by Gerard Pinard, former chairman of the Employers’ Consultative Association, to lead the discussions with the OWTU.

Unilever Caribbean Limited has operated in T&T since 1929. It is a public limited liability company and is listed on the Trinidad and Tobago Stock Exchange. It manufactures and sells homecare, personal care and food products. The Company is a subsidiary of Unilever Overseas Holdings AG (50.01% of shares held), which is a wholly owned subsidiary of Unilever PLC, a company incorporated in the United Kingdom.

Last year Unilever’s Board of Directors agreed to sell the Company`s Spreads Business, which includes the margarine brands FLORA, BECEL, I CAN`T BELIEVE ITS NOT BUTTER, BLUE BAND, COOKEEN and GOLDEN RAY.

The assets sold by the Company included production and other tangible assets used primarily in relation to spreads Business; distribution rights to spreads products in Trinidad & Tobago and Export markets and locally owned intellectual property rights, including the Golden Ray Margarine trademark.

The Home Care business consists of iconic brands like BREEZE, RADIANTE, COMFORT, QUIX and CIF.

Personal care products include: AXE, DEGREE, DOVE, LIFEBUOY, LUX, SUAVE, TRESEMME and VASELINE.

Major brands in the foods and refreshments categories include HELLMANN’S, Teas (LIPTON and RED ROSE), and Ice Cream MAGNUM, BEN AND JERRY’S, BREYERS.

The workers of Unilever hold a position of pride in the folklore of the labour movement. On May 2nd 1984, they went on strike after the
Rally at Lever Bros. strike camp 1984
breakdown of their negotiations.

According to the OWTU’s publication FIFTY YEARS OF PROGRESS “There was massive police intimidation, workers were brutalised and arrested, including 2nd vice president Cecil Paul. Women on the picket camp were not spared. A car...drove into the picket camp injuring 18 workers. Lever advertised publicly for scabs and they came in under police protection. The strike lasted four and a half months and the union was forced to accept the minister’s 24% proposal”.

Since that historic strike, Unilever’s collective agreements over the years have been used as a benchmark for negotiating with other manufacturing companies and along with Petrotrin and Nestlé’s its wage rates were used by other unions as comparator rates in their wage proposals.

Unilever is considered the oldest multunational corporation in the world. In 2018 it had a turnover of fifty billion euros and employed over 160,000 workers worldwide.
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