Kongsberg Automotive V Norwegian United Federation of Trade Unions (Fellesforbundet)

Overview

NCP Decision Accepted
Current Status Closed
Date Submitted 25/08/2008
Date Closed 28/05/2009
Case Duration 39 weeks and 3 days
Host Country US  (OECD member)
Sector Automotive 
Issue(s) The use of lockout in combination with hired labour
Provisions Cited IV.1-a  IV.2-a  IV.2-b  IV.3   
Case Description In August 2008, the Norwegian United Federation of Trade Unions(Fellesforbundet) submitted a case to the Norwegian NCP concerning the use of lockout in combination with hired labour by a subsidiary of the Norwegian company Kongsberg. Kongsberg Automotive acquired the company Van Wert Facility in Ohio in 2007-2008. The factory produces gearshift system components for the U.S. automobile industry. At the time, there were ongoing negotiations at the factory concerning employment conditions and pay. The negotiations then deteriorated, leading to a labour dispute. In April 2008, Kongsberg Driveline Systems – Van Wert Facility locked out its employees. During the lockout, the factory hired temporary labour in order to continue production. It was subsequently decided that production at the Van Wert Facility was to be moved to Mexico from August 2009.

Fellesforbundet argued that the parent company Kongsberg Automotive’s acceptance of the use of hired labour during a lockout represented a breach of the OECD Guidelines. Fellesforbundet argued that the employees at the production plant have no remedies at their disposal if the enterprise can continue its operations during a lockout without this having consequences for production. In Fellesforbundet’s view, this practice is therefore in breach of the right to collective bargaining, and thus also of core ILO conventions (ILO Conventions Nos. 87 and 98). Since Kongsberg Automotive’s corporate management in Norway accepts responsibility for this situation, it is Fellesforbundet’s view that the corporate management could also have contributed to achieving a different outcome.

Developments The NCP communicated by letter with Kongsberg Automotive and Fellesforbundet, and held a meeting with both parties on 25 March 2009 to discuss the complaint and assist the parties in resolving the issue.

Kongsberg Automotive refuted all of Fellesforbundet’s allegations and submits that the use of hired labour during a lockout is neither a breach of the OECD Guidelines, nor contrary to Norwegian law.

Many of the claims and arguments were also submitted to the US NLRB and were rejected on 31 July 2008. The ruling was appealed to the Office of Appeals General Counsel of the NLRB, which rejected the appeal.

Outcome There are in effect two final statements: of the majority of the NCP (government and business) and the minority (the trade unions).

The final statement of the majority argues that the complaint should have been dealt with by the US NCP. The US NCP did not, however, reply to the Norwegian NCP.

On the issue of the use of lockout combined with hired labour, the NCP found that both practices would be legal in US and Norway and had been found to be legal in the court proceedings in the US. The Guidelines do not specifically address the issue of lockout. It also found that there was no breach of ILO Conventions. However, it concluded that "as it has become part of Norwegian parent companies’ corporate social responsibility to encourage their foreign subsidiaries to observe Norwegian labour traditions insofar as is practicable. In Norway, using hired labour during a labour dispute would not be in keeping with Norwegian practices and traditions. The Norwegian NCP recommends that Kongsberg Automotive takes such considerations into account should a similar situation arise in the future."

The minority NCP view (the trade unions) stated that the case should have been handled by the Norwegian NCP and that the existence of parallel legal proceedings in the US should not have affected the decision of the Norwegian NCP as the US has not ratified ILO Conventions Nos. 87 and 98, which are fundamental to the complaint. It also argued that "the use of hired labour in connection with a lockout is incompatible with the rules governing Norwegian labour relations, and this has been the case since the early 1930s".

Organisations

Lead NCP Norway NCP : Independent Expert Body 

Companies

Multinational Company Kongsberg (Home country: Norway)
Subsidiary Kongsberg Driveline System - (Home country: US)

Complainants

Lead Complainant Norwegian United Federation of Trade Unions - Fellesforbundet : National Centre 

Related Documents

Norwegian NCP  [Publication date: 28/5/2009] 'Statement by the Norwegian National Contact Point for the OECD Guidelines for Multinational Enterprises concerning a complaint against Kongsberg Automotive for breach of the OECD Guidelines for Multinational Enterprises'
   http://www.regjeringen.no/upload/UD/Vedlegg/ncp_statement.pdf [Date URL accessed: 23/5/2010]

TUAC Analysis

Did the NCP publish its initial assessment? status-icon
Did the case involve parallel proceedings? status-icon
Was the existence of parallel proceedings an obstacle to the NCP accepting the case? status-icon
Was the businsess relationship other than that of a subsidiary? status-icon
Was the nature of the business relationship an obstacle to the NCP accepting the case? status-icon
Did the NCP inform other relevant government departments about its acceptance of this case? status-icon
Did the NCP offer mediation or conciliation? status-icon
Did the company accept the offer of mediation or conciliation? status-icon
Did the complainant(s) accept the offer of mediation or conciliation? status-icon
Was mediation or conciliation held? status-icon
Was mediation or conciliation conducted by a professional mediator? status-icon
Did the parties reach agreement? status-icon
If yes, did the NCP publish this agreement following the consent of the parties? status-icon
If mediation was refused or failed did the NCP make an assessment of whether the company had breached the Guidelines? status-icon
Did the NCP conduct in-host country fact finding? status-icon
Did the NCP make recommendations to the company on the future implementation of the Guidelines? status-icon
Did the NCP publish its final statement or report? status-icon
Did the NCP provide for follow-up of the agreement/recommendations? status-icon
Did the NCP inform other relevant government departments about its final statement or report? status-icon
Did the NCP inform public pension funds about its final statement or report? status-icon
Did the NCP apply any consequences in this case? status-icon
Did the NCP follow the indicative timescales set out in the procedural guidance? status-icon
Was there a positive outcome for the workers involved in this case? status-icon
Did the filing of the case under the Guidelines have a positive impact for the workers involved? status-icon
Did the lead NCP play a positive role? status-icon
If different, did the home NCP play a positive role? status-icon

Implications

NCP cooperation: this case is unusual in that it was dealt with by the home country NCP, rather than the host country NCP as a result of the host NCP's failure to respond; the weight of a split decision in the NCP