French motor giant signs CSR deal with trade unions

Peugeot Citroen has reached a landmark agreement with 85 trade unions by committing itself to new global workplace and supply chain standards.

The multinational French car manufacturer, which has 210,000 employees worldwide, says the ‘global framework agreement’ will significantly expand the scope of its CSR initiatives, which have been developed mainly in Europe.

The agreement has been drawn up with the International Metalworkers’ Federation and the European Metalworkers’ Federation, together representing 85 unions, each of which will now separately sign the document in the countries in which they operate.

Among other things, the agreement:

encourages employees to organize ‘as they so choose’
sets a general minimum employment age of 18
should lead to best practice guidelines on social dialogue, health and safety, remuneration, apprenticeships and equal opportunities, with the intention to create working conditions ‘in line with the highest international standards’ throughout the group.

Europe’s second-largest automaker will apply its equal opportunities and diversity policies – developed in western Europe in conjunction with unions in 2003 and 2004 – to all countries in which it operates. The company is rapidly expanding production in China – where workplace conditions are often a key concern – through a joint subsidiary with the local Dongfeng Motor Group. The subsidiary’s Wuhan plant should produce 300,000 units a year by 2008 and a new production site is also being sought.

Human rights will be ‘critical’ in the selection of suppliers and subcontractors worldwide, and new requirements will be developed with unions.

A ‘global council’ will bring together employees and managers for regular discussions of group strategy, ensuring that the agreement is ‘applied smoothly’. The council, composed of representatives of all subsidiaries employing more than 500 people, will be an extension of the company’s European Works Council, which brings together employee representatives and managers and is required in France under EU law.

The framework agreement will come into immediate effect and will be applied through country-level action plans drawn up with local unions. There will be a three-year monitoring cycle.

Jean-Luc Vergne, who has been instrumental in setting up the agreement as Peugeot Citroen’s executive vice-president of human resources, said the group hoped to create ‘a balanced approach to achieving economic performance while ensuring human progress’. The involvement of unions was designed to show that the development of the agreement was ‘more than just a unilateral corporate decision’, he added.

The company aroused controversy last month following its decision to close a manufacturing plant in the UK with the loss of 2300 jobs.