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ROUTES TO MARKET

MAKING THE AGENCY MODEL WORK IN EUROPE
Author: Paula Staunton
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Here are some golden rules:

1) Understand that what you can do varies widely from country-to-country. Payments for redundancy rise as high as one and a half months for every years' service in certain European jurisdictions .

Collective consultation with works councils (such as trades unions) may be triggered by particular factors in the restructuring - usually how many employees are affected. For example, in Holland, collective consultation is required where 20+ employees are affected, in Germany, the obligation can be triggered by as few as 5+ employees in a workforce of 20+.

Social Plans (an agreement between employers and employee representatives/works councils to mitigate hardship) apply in many countries, including Germany, France and Spain. This could, for instance, put you under extensive obligations to find alternative employment for those affected.

It may also be necessary to involve labour authorities (such as the DTI). The extent of involvement will vary, but will range from a duty to inform to verification of the whole consultation process and Social Plan

2) Have a well-planned overall strategy. The secret is to plan ahead. Don't get panicked into piecemeal decisions. If you are well-informed in advance, you can weigh up the costs and benefits of action across countries. This should include an assessment of the risk of litigation and bad PR. Make sure you budget for management time, which can be considerable, as well as external costs.

3) Allow enough time. Collective consultation may prove necessary and it is worth noting that this may take some time. Consultation periods vary from country-to-country. In the UK collective consultation must be for a period of 30 or 90 days (depending on the numbers affected). If you do your research into timeframes early on, then you will eliminate nasty surprises later.

4) Put one senior manager in charge of the overall plan. It is normally a mistake to adopt a piecemeal approach. You are more likely to hit deadlines and avoid soaring costs if one person has overall responsibility.

5) Look at legal alternatives. It may be more efficient to close down subsidiary companies overseas and replace them with individually appointed distributors or resellers, perhaps even managed or staffed by your own departing personnel. However, the acquired rights directive may apply in these circumstances.

Many companies seek to buy out employees legal rights by offering lump sum payments in return for a waiver of claims. Procedures for such waivers will vary from country-to-country.

6) Plan, plan and plan again. The overall message is simple. Time invested early on is time well spent. Don't leave things too late or you will find the costs and time mounting.


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