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Nestlé Philippines Unions Issue New Challenge to Rampant Casualization

Posted to the IUF website 12-Apr-2006

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On April 6, 2006, the IUF-affiliated Council of Filipino Nestle Unions (CFNU) submitted a written request to the Department of Labor and Employment (DOLE) Secretary, Patricia Sto. Tomas, calling for government inspections of all Nestlé worksites in the Philippines to assess compliance with labour standards and expose violations.

The move was prompted by the attempt of the management of the Nestle Cagayan de Oro plant to submit the Department of Labor and Employment's “Checklist for self-assessment on compliance with labour standards” survey without conducting a joint assessment with the union. Instead, management requested that the union simply sign the already completed self-assessment survey. The union refused and filed a grievance, accusing the management of failing to abide by the bipartite procedures required under DOLE's compliance assessment procedures.

A key provision of the “Checklist for self-assessment on compliance with labour standards” survey is that all contractors and subcontractors must be interviewed and provide documentary evidence of social security registration, social security payments, payment of wages etc. This is something that none of the CFNU affiliates have seen. As a result, they are now calling for DOLE inspectors to examine closely whether Nestle’s contractors and subcontractors are in fact abiding by the Labour Code.

The Union of Nestlé Workers Cagazan de Oro Factory Factory (UNWCF), a member of the Council of Filipino Nestle Unions, has been battling the destruction of permanent work at the plant since 2001, when it requested the Labour Department to investigate “labour-only” contracting by Nestlé's co-packer COFIPAC. The union argued that COFIPAC was not contracted by Nestlé as a coffee packing company to pack Nescafe products, but was serving as a labour contracting firm. The Labour Department inspection team found that the complaint was true, and that three companies, COFIPAC, FEDCON and SCF General Manpower Services, were providing labour-only contracting to Nestlé. Nestlé claimed that they were independent third-party contractors, which means they should have their own plant and equipment and not simply supply labour. The investigation also found they were producing the same products as regular employees directly employed by Nestlé.

Based on these findings the union filed a complaint in the National Labour Relations Commission, but it was not until January 2005 that Nestlé answered the charges. In July 2005 the Labour Arbitrator ruled in favour of the company. The union, which has amassed an enormous amount of evidence documenting the company's abusive employment practices, is committed to pursuing the case to the Supreme Court.

Nestlé continues to reorganize its operations to maximize the elimination of permanent jobs, thereby accomplishing the twin objectives of cost-cutting and reducing union membership and bargaining power. Under the guise of regulating “non-regular employment” throughout the Nestle system new company guidelines redefine "core" and "non-core activities" to exploit “legitimate” forms of outsourcing and casualization.

At Nestle’s Lipa plant in the Philippines 137 positions in 3 product lines will be categorized as “non-core”, a figure equivalent to 49% of the 270 union members currently holding regular positions at the plant. All packaging, as well as certain kinds of filling and bagging, will be classified as “non-core” and will be outsourced to labour-hire agencies and co-packers.

According to the CFNU, which is organizing to fight these changes, "Nestle makes billions out of branding and marketing, but now they're saying packaging isn't part of their core business!"