On May 27th/28th, the Siemens Europe Committee (SEC) held its 20th meeting session at Manchester, UK. 33 members from 20 European countries took part in the meeting; the representatives from Poland, Slovakia and Ireland were missing. Harald Kern, the SEC chairman, opened the meeting and welcomed the participants. He especially mentioned that this would be the 20th meeting of the Siemens Europe Committee.
Paul Gregory, Jannett Morton and Russell Ede, the SEC representatives from the UK, presented the history and the current situation at Siemens UK.
Siemens started its activities at the UK already in 1843 with the beginning of industrialization. Siemens has recently been expanding at the UK, the energy sector of Rolls-Royce has been purchased and a wind power factory has been opened at Hull. The number of employees of Siemens UK was about 14 000 last year.
Lately, there have been discussions with the management of Siemens UK about the installation of consultations between unions and management on national level. Harald Kern gave some informations about the project that has been carried out with the re-presentatives of the North/West region of the SEC. The main objective of this project was to clarify the tasks and the rights of the SEC members. The project was evaluated positive by the participants.
Birgit Steinborn, the chairwoman of the Central Works Council in Germany, informed the SEC members about the situation at Siemens in Germany. She pointed out, that there is some disappointment about the Siemens CEO, Mr. Joe Kaeser. The main issues at the moment are the low-profit businesses of Siemens, the division Power and Gas and the reduction of bureaucracy.
The business divisions Metal Technologies and Audiology (Hearing Aids) as well as the Healthcare IT have been sold; now, the low-profit are supposed to be reorganized by Siemens itself. Unfortunately, this will go together with job cuts. The management also plans to cut 1 200 jobs in the energy business. The reasons lack of market growth and change of the energy policy in Germany and other European countries are given, but there have also been mistakes made by the management. The market development has been misjudged and the expenses for Research and Development have been reduced. Now, there are plans to relocate jobs from Europe to Asia and America.
The German Works Council supports the idea of reducing bureaucracy, but does not appreciate the announced job cuts. It closely watches the measures that are taken to reduce complexity inside the company and takes influence on them. There is a lot of pressure from the stock market on the management and the employees’ representatives to execute radical measures at Siemens. There are also permanent discussions about splitting Siemens into several companies and to form a holding structure. The Works Council thinks that more innovation, a company strategy for Europe and a culture of participation are needed at Siemens.
Fritz Hagl, the chairman of the Central Works Council of Siemens Austria and deputy chairman of the SEC, gave a report about the last meeting of the employees’ representatives from the region Central/East Europe.
The region includes 19 countries, among these 8 EU members (7 of these are represented in the SEC), with 19 000 employees. There are plans to form an “Adriatic Region” inside the region Central/East Europe to reduce complexity. This will include former Yugoslavia and Albania.
The representatives have discussed among other topics the issue of “Industry 4.0”. Roy Lund (Norway) informed about the meeting for the region North/West Europe. The topics “1 by ‘16” (cost cuts of one billion until next year), “Siemens 2020” (management plan), the splitting-off of the Healthcare division, the purchases of Dresser-Rand and Rolls-Royce Energy and the corporate culture of Siemens were discussed at the meeting.
Margherita Milite (Italy) gave informations about the regional meeting for South/West Europe. At this meeting, the split of Healthcare, the issue contract workers and the future of the own regional meetings were discussed. She pointed out, that the regional management still is reluctant to discuss topics across borders. She also said, that the figures about the number of contract workers, that were provided by the company, have to be checked carefully. Some figures were not very feasible.
The employees’ representatives want to invite management representatives from the headquarter in the future. The agenda of the meetings will be discussed with the management before the meetings.
The SEC members continued with a group work session. Four working groups were formed for these issues:
- Power and Gas
- Service functions
- Corporate culture
On the second day of the meeting, the representatives of the management took part in the meeting. Jürgen Mayer, the CEO of Siemens UK, introduced the activities of Siemens UK to the participants. Siemens started its business activities at the UK already in 1843. Today, there are 13 manufacturing sites and all together 28 larger locations with 14 000 employees. There are also 500 apprentices. Only 10 % of the GDP of the UK are created by industrial manufacturing. This is the reason for a gap in the supply with qualified workforce, especially engineers. There is also a need for investment in infrastructure. All this gives Siemens good business perspectives at the UK; Siemens wants to grow by 10% per year at the UK.
The board member and head of Human Ressources, Mrs. Janina Kugel, informed about the situation at Siemens. She pointed out the difficulties especially in the division Power and Gas, which remain regardless of the latest orders from Egypt. The management sees the need to react by cost and job cuts. She also sees too many rules at Siemens; this should be changed. The employees should take more responsibility without having to ask for decisions from higher levels.
The SEC members reacted positive, but also critical to Mrs. Kugel’s presentation. Melanie Vidigueira Portugal) and Eleni Goufa (Greece) often do not see trust and cooperation as reality in everyday life at Siemens. Pavel Holzknecht (Czech Republic) criticized the lack of management decisions. Christian Schaller (Austria) especially criticized the dominating head count thinking of the management, which leads to wrong decisions.
Birgit Steinborn (Germany) referred to an interview with the CEO, Mr. Joe Kaeser, in the “Siemens Welt” (company magazine). She pointed out, that the employees’ representatives at Germany do not agree to the management plans. It is important that perspectives are developed for the employees.
Mrs. Kugel answered that the management’s “Vision 2020” will be implemented step by step. She agreed that the culture of leadership has to be improved at Siemens. She also agreed that the reports about the numbers of contract workers have to be improved.
Mikael Wiström (Sweden) expressed his worries about the future development at the Finspång plant. Roy Lund (Norway) said that he does not see any positive effects caused by the management’s plans of the last years. He also expressed some skepticism about the purchases of Dresser-Rand and Rolls-Royce Energy and criticized the innovation process at Siemens. Hans Kreimer (Austria) pointed out some critical developments at the transformer business, especially in Austria. Kurt Thomsen (Denmark) said, he thinks that the Siemens Wind Power business is too much focused on big off-shore projects and smaller on-shore projects are neglected. Zoran Knez (Croatia) asked for the US-EU treaty TTIP and its consequences.
Mrs. Kugel agreed that the communication process at Siemens has to be improved. She stated that Siemens would handle difficult changes much more careful than companies from the US or China. She also said that Siemens would protect the employees’ rights no matter what will be agreed on in the TTIP treaty.
Mr. Hannes Apitzsch gave informations about Siemens Global Services. The SEC members asked about the consequences of the cost cutting program “1 by ‘16”. Felix Schwarzenbacher (Switzerland) criticized the process at Switzerland. The management just cuts jobs without any changes in the internal processes. Ferrán Navarro (Spain) pointed out that a lot of employees are already overstressed at Siemens. René Jensen (Denmark) gave examples where job cuts lead to more complicated processes, which do not save costs at all. Erik Vanackere (Belgium) said that he sees a lot of bureaucracy at Siemens.
Mr. Apitzsch agreed that job cuts without changes and improvements of the internal processes are not acceptable. Mrs. Kugel also agreed to this point of view.
Mr. Marco Stülpner presented the management plans for the Healthcare division. Siemens wants to react in time to the expected changes in the healthcare business. There will be some technological changes which will affect the business. The stock market investors should take part in the necessary investments; for this reason, the Healthcare division has to be split off from the rest of the company. The complexity of the Healthcare business at Siemens will be reduced.
Margherita Milite (Italy) expressed her concern about the future of the Healthcare division. She said that a lot of employees expect Siemens to sell off the division. Russell Ede (UK) especially asked for the plans for the support functions of Healthcare. Fritz Hagl (Austria) asked, if the Diagnostics business will stay separate after the split-off of Healthcare.
Mr. Stülpner answered that in the future, there should only be one Healthcare company in each country. For legal reasons, in most of the countries, the other Healthcare businesses will be integrated into Diagnostics. The support functions are still examined. There are no plans to sell Healthcare to another company. Siemens wants to keep the majority of the shares. Margherita Milite and Fritz Hagl pointed out that the integration of the rest of the Healthcare businesses into Diagnostics will cause some legal problems as well as problems with existing collective agreements and the working conditions of the employees.
Reinhard Hahn (IG Metall; Germany) demanded an agreement between unions and management about the procedure of splitting off Healthcare at each European country. Mrs. Kugel responded that this has been understood and will be discussed in the company board.
The final session of the SEC meeting was an internal meeting of the SEC members again. Harald Kern presented the changes in the SEC agreement and the rules of procedure that have been discussed with the management. Siemens has agreed to possibly provide higher standards than the law. The second SEC mandate for each country will now start at 5 000 employees. The role of the substitutes has been clarified. They have to be informed.
The SEC members have the right for information and access to the locations everywhere in their home country. The obligations as SEC members have to be preferred to other obligations at work. The SEC members are obliged to take part in the meetings. The language at the meetings will be German. Translation will be provided in any necessary language. The SEC strongly recommends the capability to speak English and/or German, especially for the internal communication. The SEC agrees unanimously to the proposed changes.
In the final discussion, the meeting was evaluated positive. The time frame was looked upon as quite narrow. Birgit Steinborn proposed to return to the practice of having the dinner with the management representatives on the evening of the second day, so that the discussed issues can be followed up in the evening. Harald Kern pointed out that the regional contact persons from the management were invited to the meeting to improve the continuity of the discussions with them.