WRITTEN QUESTION P-3128/98

by Jaak Vandemeulebroucke (ARE) to the Commission

(9 October 1998)

Subject: Closure of four establishments of Levi Strauss Europe

Levi Strauss Europe has announced the restructuring of its activities in Europe and its intention to close four establishments, with the loss of 1 461 jobs. 100 administrative posts will also be lost. Levi Strauss Europe has announced that it will comply with European Directives (75/129/EEC, 92/56/EEC and 94/45/EEC) and national legislation. The shutdown must be accompanied by a credible retraining plan for the workers.

Paragraphs 8 and 9 of the resolution adopted by the European Parliament on 13 July 1995 on relocations and job losses in the European Union state:

"8. Calls on the Commission and Member States to urge Community-scale corporations not to take decisions which adversely affect employment and about which employees have not been informed and consulted in advance and which are not accompanied by a credible retraining plan in accordance with Directive 94/45/EEC;

9. Calls on the Commission to refuse assistance from Community programmes to businesses which fail to comply with the obligations referred to in paragraph 8 or which abuse investment subsidies;"

1. In the specific instance of Levi Strauss Europe, can the Commission provide an overview of the European subsidies received by that company over the last ten years?

2. The company in question also has establishments in Poland, Hungary and Turkey. Can the Commission state whether Levi Strauss Europe has received funding under the aid programmes for Central and Eastern Europe? If so, what funding? Can the Commission provide the same information in respect of Turkey?

3. Can the Commission state whether it is prepared to apply paragraph 9 of the abovementioned resolution, should it appear, during the negotiations with the trade unions, that Levi Strauss Europe is unwilling to adopt a large-scale retraining plan for the workers affected?

4. Can the Commission also state how it can justify the aid (if any) to the Eastern European and Turkish establishments of Levi Strauss Europe, should it appear that such aid has dealt the deathblow to establishments situated within Community territory?

Answer given by Mr Flynn on behalf of the Commission

(5 November 1998)

1. The Commission is not aware of any direct public subsidies obtained by Levi Strauss Europe in recent years. However, the group may possibly have benefited from general measures open to all undertakings in Member States or from aid under horizontal or regional schemes approved by the Commission, where Member States are free to grant aid without having to notify the Commission.

2. and 4. No aid has been granted to the Levi Strauss Europe establishments in Poland and Hungary under the aid programmes for Central and Eastern Europe. Aid is never granted directly to companies under these programmes. Neither has Community aid been granted to the Turkish establishment of Levi Strauss Europe.

3. The Commission would like to draw attention to the existence of various Community legislative acts on the information and consultation of workers in the event of the restructuring of undertakings, particularly where collective redundancies are involved (Council Directive 75/129/EEC of 17 February 1975 on the approximation of the laws of the Member States relating to collective redundancies(1), and Council Directive 94/45/EC of 22 September 1994 on the establishment of a European works council or a procedure in Community-scale undertakings and Community-scale groups of undertakings for the purposes of informing and consulting employees(2)).

These directives and the provisions transposing them into national law include procedures for the enforcement of the obligations involved. In any event, according to the Commission's information, Levi Strauss has entered into negotiations with workers' representatives at both national and Community levels in an attempt to seek alternative solutions to closures or at least to alleviate their social consequences.

The Commission has recently launched a new initiative to consolidate the arrangements for informing and consulting workers in the Community. It includes aspects designed to ensure "upstream" consultation within the undertaking and, in the event of workforce cuts, encourage negotiated solutions (training, retraining, redeployment).

The high-level group established at the request of the Luxembourg European Council to produce a report on the economic and social implications of industrial change has stated in its interim report that undertakings which do not make sufficient effort to provide training for their workers should be disqualified from receiving public aid.

(1) OJ L 48, 22.2.1975.

(2) OJ L 254, 30.9.1994.