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European automobile producers in MERCOSUR, like Volkswagen do Brazil,
traditionally produce, to a large extent, for the domestic market. As a result of the
weak Brazilian economy in 2002 and 2003 and given the importance of the Brazilian
production and sales for the consolidated accounts of the Volkswagen AG globally,
the Brazilian subsidiary Volkswagen do Brazil has been responsible for a major
share of Volkswagen’s overall losses in 2002-2003. 203 VW do Brazil has an annual
production capacity of 740,000 vehicles, but currently [2003], due to the “weakness
in demand”, only 473,000 vehicles are being produced. 204
In times of such “weaknesses in demand” transnational corporations like Volkswagen,
which like to praise their “social responsibility” towards their employees in a
publicity-effective manner, don’t take labor law too seriously, as the 2003 corporate
strategy to confront these losses shows: Cost-management through layoffs. And
in doing so the Wolfsburg headquarters has not been squeamish and with only
shareholder value in mind is ready to pass over labor laws as well as over their own
otherwise publicly effective, marketed, both internally as well as globally valid codes
of conduct.
Volkswagen planned to reduce personnel in the plants in the federal states of
São Paulo, Tabaute and Anchieta by 4000 employees. Anchieta is the oldest Volkswagen
plant in Brazil and at the same time the largest Volkswagen entity abroad.
In order to reach this goal, without violating the job security agreement between the
union and the corporation which is valid until 2006, the 4000 employees are to be
transferred to a Volkswagen employment and training firm –in response the VW-employees
were up in arms and announced strikes. Volkswagen CEO Bernd Pischetsrieder
felt he was in the position to pass over all valid Brazilian labor legislation, and
to threaten all strikers with layoffs, 205 a statement which was explicitly confirmed by
the Volkswagen spokesman. 206 This in turn induced the Brazilian Labor courts 207 to
consider taking legal action against the VW-board of directors. 208
Whether the right to strike is a fundamental right, however, is being disputed.
The right to strike is not explicitly mentioned in the ILO Conventions No. 87 “on freedom
of association and the protection of the right to organize” of 1948 and No. 98
“concerning the application of the principles of the right to organize and to bargain
collectively.” But the ILO Committee on Freedom of Association (CFA) considers the
203 Apart from the “weakness in turnover” the resulting “costs of restructuring for the Brazilian-bussiness” are adduced.
http://www.ftd.de/ub/in/1067066343667.html?nv=sl.
204 http://www.n-tv.de/3173891.html.
205 http://www.bbc.co.uk/portuguese/economia/story/2003/09/030923_volksvale.shtml.
206 http://www.bbc.co.uk/portuguese/economia/story/2003/09/030923_volksvale.shtml.
207 “Procuradora-Geral do Trabalho.”
208 http://www.estado.com.br/editorias/2003/09/26/eco043.html.