Labor Omnia Vincit

Of all the problems that face U.S. companies setting up shop in Europe, one of the most perplexing is how to deal with European labor. The workers generally welcome American firms for the good working conditions and higher pay that they offer, but U.S. executives soon find that it takes more than that to get along with their European help. Not that European labor is necessarily more demanding or obstinate than U.S. labor: it is merely different. The U.S. firm that wants to make a success on the Continent cannot afford to ignore the differences.

One of the first things the American learns is that the working habits and foibles of European workers are not easily tampered with. The Europeans expect--and get--longer vacations (four weeks in France) and more legal holidays (14 in Sweden) than in the U.S. They also cling to their own ways, no matter what the efficiency experts say: Germans like their bottle of beer on the job, the French must have their daily liter of wine, and the Spaniards insist on a three-hour siesta at midday. A U.S.-owned factory in Amsterdam barely averted a walkout over how the cafeteria food should be seasoned, and an exasperated U.S. executive in France found that, after one worker complained of a draft, he had to discuss for hours what doors of a warehouse should be opened or closed.

Help or Hair Shirt. In Britain, contracts are brief, often oral, and sealed with no more than a handshake. Though the Germans rarely strike (only 34 strikes all last year), the French have a way of striking at any time without warning; wildcat walkouts are especially prevalent in Britain, where the courts have little power to intervene. U.S. businessmen are often taken aback by the anti-capitalist polemics, greater militance and puzzling multiplicity of the labor unions. The British have 190 unions, and a company such as Ford must negotiate with more than 20 on each contract go-round. In France three welders working side by side may belong to three different unions.

European governments loom especially large in labor negotiations. Because the French government employs 25% of the country's labor force and the Italian government 12%, they wield a tremendous influence on wage policies. Under the complicated French labor code, special labor courts handle all grievances, and each plant is required to have an employee committee sitting as advisers to management. Called the Comite d'Entreprise, it can be anything from a great help to a hair shirt, meets at least monthly with plant managers and can have the company's books audited at any time.

Paternalism counts for as much in Europe as the paycheck--and can be almost as expensive. Fringe benefits, for example, add up to as much as 55% of the average salary, compared with only 16% in the U.S. Besides providing cradle-to-grave medical and pension plans, companies in Italy are also expected to provide such extras as summer camps at the shore, low-cost housing and nurseries for employed mothers. French companies with more than 15 employees are required by law to provide lunch at greatly reduced prices. A German is more likely to change jobs for a better Betriebsklima, or working climate, than for more pay.

Paris Is Not Arizona. The most serious problem that U.S. companies encounter--fortunately, not too frequently--is the layoff. Though they are accepted as occupational hazards in the U.S., layoffs are almost unheard of in Scandinavia and Southern Europe--and are sure to raise a storm anywhere on the Continent. They violate one of Europe's oldest labor traditions: a job, once obtained, is supposed to last indefinitely. Normally, European-owned factories switch workers to other assignments or put them on half-day shifts, but almost never fire them outright. Machines Bull-General Electric a month ago drew black headlines and angry cries of "Paris is not Arizona!" when it laid off 500 workers. When the U.S.-owned Beloit-Italia paper machinery plant near Turin tried to lay off 300 employees recently, workers invaded the factory in protest and occupied it for eleven days. They were fed through the fences by women and children, and the parish priest even came on Sunday to say Mass before the factory gate. What company wants to battle odds like that?

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