Strategy and Management
Akzo Nobel’s powder coatings division in South Africa operates under the global brand name Interpon Powder Coatings, which falls under the management of the Powder Coatings Business Unit, which is located in theUK. The following issues can be addressed through local strategies, provided they remain within Akzo budget guidelines;
employment and restructuring;
operational and financial objectives;
research and development and product ranges;
investment decisions involving expenditures of below 25,000 rands.
Employment
There has been no increase in the use of subcontracted workers.
Akzo only employs casual labour on an ad hoc basis and uses temporary workers to meet increases in production.
Investment plans are focused on modernisation, the replacement of old equipment, and on health and safety initiatives to conform to international business standards. No job losses are anticipated resulting from these plans. However, it is likely to lead to higher skills requirements.
Labour Relations
There is freedom of association:
There have been no difficulties in getting the union recognised.
Worker representatives are able to call unscheduled meetings.
Shop stewards are given time off to attend to union matters upon request.
The union (SACWU) has no difficulty in distributing information to all workers at the plant.
The management is willing to consult and provide information necessary for collective bargaining purposes.
Right to Information on Strategic Company Issues
Issues concerning restructuring, outsourcing, subcontracting, and the introduction of new technology are not commonly discussed and are not negotiated. Partly because shop stewards do not request meetings to address these issues. Meanwhile, shop stewards feel that the company should take more initiative in raising these issues with the union.
Conflicts
With the fusion of the production activities of Akzo Nobel and Plascon, the differences between work conditions of the employees at the two companies led to some friction and quarrels:
Akzo Nobel was prepared to settle for a wage increase of 13%, but Plascon was not (1997).
Plascon, meanwhile, was providing employees with a commuter subsidy, which Akzo Nobel wanted to discontinue.
Akzo Nobel had a policy of restricting salary advances to three times annually. Plascon offered its employees salary advances as often as necessary.
Plascon provided low-interest company loans while Akzo Nobel provided company loans at the current prime rate.
Labour Conditions
No cases of child labour or forced labour have been uncovered (although there was no investigation of Akzo’s supply chain).
No complaints have arisen regarding discrimination based on race, gender, religion, or disability.
Akzo Nobel is not the highest paying company in the sector, but it does offer some of the most reasonable wages. Wage rates are above the minimum level established by the bargaining council.
Akzo Nobel offers many benefits, but non-standard employees, such as contract workers, are excluded from all benefits with the exception of access to on-site medical facilities. The following benefits are not available to temporary workers:
Provident/pension fund, medical aid, loans, transportation, ESOPS, paid vacation, paid sick
leave; childcare services, incentive bonuses, severance pay, paid maternity leave, and a car
allowance.
In terms of training, Akzo Nobel is currently spending 1% of its payroll on skills development and training (the exact legal requirement).
There is a Health, Safety, and Environmental Committee with monthly meetings.
Reorganization, Restructuring, and Relocation
The most significant restructuring took place in 2001 with the closure of three divisions of
International Paint (Pty) Ltd.. Workers were offered voluntary retrenchment packages. This
closure led to the loss of 172 jobs. There was no industrial action as a result of these
retrenchments, but the matter was dealt with through a formal consultation process.
Environment
Environmental standards and targets are established by the headquarters in the Netherlands.
Akzo Nobel South Africa is currently targeting an ISO 14001 listing in 2003. Shop stewards
were not familiar with Akzo Nobel’s environmental policy.