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Solidarity in MNCs: when and where does this occur?

Shedding light on the interplay and coordination processes between different institutions and actors in MNCs

Author: Sophie Rosenbohm, Institute for Work, Skills and Training, University of Duisburg-Essen

In multinational companies, solidarity among employees must be developed across national and cultural boundaries and, quite often, against the backdrop of site competition. A key question is therefore: What preconditions have to be met that employee representatives develop mutual support, cooperate with each other, and identify common concerns and interests?

Overall, actors must overcome fragmentation, bridge existing differences, create the perception of common concern and must define those as injustices. Moreover, solidarity also requires coordination among employees and their representatives who are – in the case of MNCs – geographically dispersed (Rosenbohm & Hertwig, 2021). In recent years, much attention has been devoted to European Works Councils (EWCs), the first supranational institution for company-level employee representation, and the question what role EWCs play for overcoming fragmentations and for developing mutual support among employee representatives from different countries (see for example Kotthoff & Whittall, 2014).

Employee representation in MNC is, however, embedded in a highly complex multi-level system; this includes, for instance, works councils and shop stewards at the plant level, trade unions and central or group works councils at the national company level and European or even World Works Councils at the transnational level. MNCs typically consist of numerous operations distributed across a large number of countries encompassing different national institutional frameworks for employee representation like dual or single channel representation systems. MNCs are thus characterized by the co-existence of many of these institutionalized systems of participation with distinctive national characteristics and institutional features. For instance, some countries, such as Germany or France, possess complex structures of local works councils and supra-workplace representative bodies such as central and group works councils, sometimes this is even supplemented by board-level employee representation. Transnational employee representation via European Works Councils (EWCs) or World Works Councils (WWC) adds an extra layer to this complex multi-level system of action fields (Haipeter, Hertwig, & Rosenbohm, 2019).

Source: own compilation; see also: Haipeter, Hertwig, & Rosenbohm, 2019, p.

This multi-level system of employee representation is not organized hierarchically. Instead, legitimacy and authority are delegated from below. For instance, an EWC depends on decision-making powers acquired through the agreement of other parties: it has no inbuilt authority over the national or local level. Thus, employee representation in MNCs relies very much on the capacity to coordinate and integrate different interests, strategies and orientations across different action fields. This means, employee representation in MNCs is confronted by a dual challenge of articulation: to coordinate interests between the local, national and transnational action fields of employee representation and to integrate interests on the respective levels. It is therefore important not only to focus on the transnational level but to extend the analytical perspective by analyzing the interplay and coordination processes between different institutions and actors at different levels

A practice based on solidarity does not, however, result from the mere existence of these different levels or emerge automatically on the basis of existing needs for action in the case of cross-border restructuring in MNCs. Rather, empirical findings underline that it must be actively established by the actors involved. Employee representatives in MNCs have to mobilize resources, and they have to forge coalitions as well as construct common interpretations and interests (here and in the following see Haipeter, Hertwig, & Rosenbohm, 2019).

Quite different practices of integration and coordination between the various actors and levels of interest representation in multinational companies emerge in phases of restructuring. The spectrum ranges from ‘disarticulation’, which is characterized by weak vertical coordination between the national and transnational action field in combination with weak integration, where the exchange of information and communication remains underdeveloped and where no shared interpretations and interests are developed, either because conflicts of interest have proved irresolvable or there are no actors able to integrate them successfully, to ‘comprehensive articulation’. In the latter case, dense communication and interaction exist and the transnational action field has developed into an important instance of coordination in combination with a high degree of integration, making it possible to develop common interpretations and common goals for action. Such active integration is based on interpretive patterns that attribute added value to the transnational level for local and national advocacy action and also benefits from the activation of resources and power resources at different levels.

A high degree of coordination and integration, which can be regarded as an important precondition for acts of solidarity, will only come about when actors see that an added value can be generated through representation at the transnational level – either in the form of obtaining additional information, coordinating and agreeing a common position vis-à-vis group management or supporting employee representatives at local level – and at the same time are sufficiently strong to deploy their resources in the transnational action field.

 

References/more information:

Haipeter, T., Hertwig, M., & Rosenbohm, S. (2019). Employee Representation in Multinational Companies. The Articulation of Interests in Multilevel Action Fields. Cham: Palgrave Macmillan

Kotthoff, H., & Whittall, M. (2014). Paths to Transnational Solidarity. Oxford: Peter Lang.

Rosenbohm, S., & Hertwig, M. (2021). Interessenartikulation in multinationalen Unternehmen – Konkurrenz und Solidarität im europäischen Mehrebenensystem. In C. Wirth (Hg.), Konkurrenzen und Solidaritäten: Festschrift für Anton Kobel zum 75. Geburtstag. Nomos/Rainer Hampp: Baden-Baden.