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Norkers helpVolvo compet

19th September 1981
Page 14
Page 14, 19th September 1981 — Norkers helpVolvo compet
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Which of the following most accurately describes the problem?

THOUGH VOLVO was one of few lorry manufacturers to ike a profit last year, accord to Gunnar Huseryd, vice)sident and deputy marketing ector, workers are willing to ;ept minimum wage increases d have a refreshing sense of ilism. This is the more surprisj because trade unions have a ong influence on Swedish blic opinion and could use 3.ir muscle power destructively they chose writes ARTHUR IERLOCK-MESHER.

This responsible attitude ntrasts sharply with that in me sections of British indus,. For example, the announceant by Sir Michael Edwardes, airman of BL, of a trading loss £143 million and an overall 3s of £225.8 million in the first If of this year immediately ought a demand from the lions for a 20 per cent wage crease. Excessive fixed costs Id overmanning caused a tradg loss of £47 million by Leynd Vehicles alone, said Sir ichael — particularly disap-• Anting when there was a tradg profit of £7 million in the first 3If of last year.

Against this depressing background it was refreshing to discuss industrial relations with Martin Marklund, managing director of Volvo's splendid cabbuilding plant in Umea, Northern Sweden. It employs 1,040 people — 887 on the shop floor and 153 in the offices — and average earnings are about £3.50 an hour, or £140 for a 40hour week. The working day is from 7am until 4pm, Some £12 million has been invested in a new 11,000sq metre paint shop. Production at Umea is divided into four sectors — parts manufacture, cab assembly, painting, and assembly of trim parts. A high degree of mechanisation is being achieved without industrial strife. In fact, the press lines are almost fully mechanised, as in the car division of AB Volvo.

There are already seven robots in use and another nine are to come. Six will be employed on painting. Each costs about £100,000 to install, of which £3 5,00 0 is the cost of the machine. Expansion should avoid the need for redundancies as the result of automation but, said Mr Marklund, workers must be willing to change jobs.

They would in future require higher technical qualifications, which could be obtained at Umea University, "The organisation and development of leaders," Mr Marklund added, was another important need. This is a matter in which the unions have an interest. Employers are required to tell them in advance about the appointment of managers and their opinion of the acceptability of individuals has to be invited, although it is not decisive. The system worked well, Mr Marklund told me.

While British unions commonly pursue leapfrogging tactics, legally enforceable wage agreements in Sweden are negotiated for two years between the employers' federation (SAF) and the labour organisation (SLO). Unions or employers who break the agreements can be taken to an industrial court.

An employer who is victimised by a strike can get financial aid from SAF. On the other hand, SAF may penalise an employer who lures away another's workers by offering wages in excess of the agreed figure, although this does not preclude the negotiation of local productivity agreements.

What was regarded as a wages explosion occurred in 1975 when employers were compelled to concede a 12 per cent increase. British employers would have indeed been grateful for such a modest settlement.

The current two-year agreement provides for an increase of 4 per cent this year and 3 per cent next year. Negotiations are facilitated by the existence of only one union for all shopfloor workers at Umea and one f white-collar staff. It also r moves the risk of costly int union disputes.

The modest settlement is a c gent commentary on the reali tic attitude of unions tower profit and stability despite an flation rate of about 12 per ce and only 4 per cent nation unemployment. To survive country of only some 8 milli population must be competiti in international industrial m kets. Volvo, for instance, expo about nine-tenths of its lorries.

The Umea plant is split in cost centres, each with its sm management or works comm tee selected from among t workers and presided over by foreman. Two examples taken random are the press shop the original cost centre -an the assembly hall, which wi 200 workers is the largest co unit.

It is a system that fostel helpful relations between mat agement and staff. So does suggestion scheme in which hz the profit from any worthwhi idea is awarded to its author the year after its adoption. Tf possibility of paying a born based on the quality of work merit money — is also beir discussed.

Even in a harmonious atmo phere, however, wildcat striki occasionally occur. Volvo hione last year. It lasted all of day-and-a-half and made pac one news, with Mr Marktund b ing interviewed on televisio The management took a fir line: no further negotiations c. wages until the strikers return( to work. They came runnir back.

Workers' representatives who are not called directors sit on company boards.

A proposal that has be floated in Sweden is that er ployers should be able to p part of any wage increase intc trust fund administered by union to enable workers to b an interest in companies. Marklund had reservatiol about its acceptability.

Having regard to the Trar port and Gene,ral Worker Union's condemnation of t plan to sell equity in the Natior Freight Co to the staff, I canr imagine that the Swedish id would get far in Britain.


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