The situation of the German economy is leading to rising unemployment, a large number of restructuring measures, increasing social unrest and an unusual level of media coverage of some of these disputes. Furthermore, the proposed review of the pension scheme for those retiring at 63 (subject to certain conditions), should the legislation be passed, will limit companies’ recourse to this option, thereby making it more difficult to find solutions through the departure of employees with long service.

To properly prepare for the announcement, it is fundamental to fully integrate the principle of co-determination (mitbestimmung) and how it applies to the specific site or company in terms of the quality of social dialogue.

Beyond the specificity of legal procedures, do not forget that the fundamental principle of co-determination requires management to prepare the content of the restructuring/transformation plan very precisely in advance, anticipating the reactions of the works council, unions, and employees—not only on the principle of the project but also on the schedule and implementation conditions (expect pertinent remarks, or even alternatives that deserve to be studied).

For the project team, the objective must be to propose an acceptable and realistic roadmap and budget to the Board and, if possible, to prepare local mindsets well in advance. It is essential for a foreign group to take into account the prerogatives of the Works Council (Betriebsrat), which is much more involved than in other countries in the strategy and operation of the company (working conditions, individual data protection, etc.).

Of course, this is even more true when the trust, loyalty, and relationship built between stakeholders is average or even poor.

Ideally, the company will take the time to rebuild these relationships before announcing its plan, but it is often not possible to wait.

In any event, a precise analysis of social risks, costs, and probable execution timelines must be conducted, exploring the possibility of avoiding a formal social plan process, if feasible.

Winning social strategies often include the following ingredients: establishing a high-quality dialogue to try to reach an agreement on the project (interessenaussgleich), effective governance around a project team that involves local management and that of other potentially impacted sites, proper consideration of tools to minimize social impact, as well as providing a perspective on the future of the company/site—a subject to which social partners are very attached.

Oneida’s teams, who regularly work on these subjects—particularly with their partner Von Rundstedt, a leader in career transition consulting—are ready to answer questions from companies that need to lead this type of project in Germany.

A big thank you to our speakers Thierry Hubert, Expert Consultant, former HRD at OP Mobility and Alstom; Frédéric Blaisot, former HRD at Hager and Schneider Electric; Carina Muskolus, Director Transformation Advisory at von Rundstedt; and Dr. Matthias Sandmaier, Partner at Littler Munich; as well as to Philippe Grabli for moderating the evening.