Germany to Nokia: Give us back our subsidies
€41m plus €18m interest, thanks
Germany's western state of North-Rhine Westphalia (NRW) has told Nokia to repay all its subsidies plus interest by 31 March or face legal action.
The German state paid €41m in aid for Nokia's mobile phone factory in Bochum, under the condition that at least 2,800 jobs would be created. However, the Finnish mobile giant is to close its plant by 30 June and move its operation to Romania.
The closure of the plant infuriated many German unions and politicians and fuelled a strong anti-Nokia and anti-Finnish sentiment in the country with many consumers turning their backs on Nokia products.
But Nokia says it has no choice. Labour and non-wage labour costs in Germany are not competitive enough for the mass-production of Nokia products. In Romania, the average monthly salaries will be about one-tenth of the average wage of workers at Bochum.
Nokia employed more than 2,300 people in Bochum in exchange for EU and state subsidies. The company says it fulfilled all the necessary conditions for the subsidies, but NRW believes Nokia fell short of the required numbers by 200 to 400 posts between 2002 and 2005.
On Tuesday, the state government formally demanded that the company pay back €41m in subsidies, plus €18m in interest.
The two sides are expected to negotiate in the next few days. State Finance Minister Christa Thoben has punted the idea of opening up a technology business park with Nokia as the main investor.
Nokia received more bad news today after components supplier Texas Instruments Inc warned of deteriorating conditions in the wireless industry. Nokia shares dropped below €20. ®
Although I'm meanwhile not completely up to date anymore with respect to german labor law, maybe first a fact and than a little story from the pricvate sector in France for you:
The fact is, that in case you want to lay someone off for poor performance in France, you give him a warning in the OBLIGATORY annual personal performance assessment and you'll repeat the exercise three months down the road. In case his performance
has not improved you can lay him off for professional reasons. He'll take one month of salary, his remaining holidays and in case of seniority (for every 12 months in the company) another month of salary (however, there is a cap,
which I fail to remember).
Not really too hard is it?
And you can believe me, since I HAD to lay off people like this.
And now the little story:
My wife is in the mid management of a small subsidary of a bigger US-based company. Since the downturn of the US-economy, the writing was on the wall that the company will have to reduce it's workforce.
Consequently, the french management advised the US-bigwicks to do the annual performance evaluation and tag the dead wood in the company with a warning, so that in case of lay-offs at a later stage, the procedings have already been started according to french labor law.
The american headquarter, however - at the time very busy with merger talks - could not be bothered with such small folkloristic labor law details overseas and prefered not to listen. Even worse - two weeks before Xmas they perform a "cut and paste style" evaluation which assignes even to the underperformers an "acceptable" performance.
Then the happy new year 2008 arrives and the US-board decides, well, this year we lay off some folk.
And, since merger talk should not be clouded by bad economic rumors, we call a lay-off for economical reasons (which has in France completely different proceedings) not by it's proper name, but we say we simply get rid of some dead wood and tell the underperformersto take a hike, because - well - they underperform.
Subsequently, they send a firing squad for immediate execution to France, which - despite a renewed warning of the french management that this will violate french labor law and thus will provide any half-way decent lawyer a huge opening to rake in huge compansations - summons the delinquents and let's them know that they mustn't drop in tomorrow morning, because it came to the managements attention that their performance sucks.
Naturally, the inevitable happens: These people print out their "acceptable" december evaluation, get a good lawyer who rips the proceedings legally apart and get a full featured six months of salary as a golden handshake out of all this.
IMHO - rightly so.
Since then the US-based human resource department runs around in the headquarter telling anyone who will listen that it's:
1) Nearly impossible to lay-off staff in France. That's a bloody commy cell over there.
2) Last thing we'll ever do is hire someone againin France.
I guess, they sound in their rants a lot like you Oliver.
And the french management came to simply two conclusions:
1) That this was the most botched up firing exercise they have ever had to witness. The diletantic way
in which it was MANAGED basically tripled the costs.
2) Apparently the wrong people were fired. Shoving the HR bums and one or the other bummer from the board over the
cliff would have lead to substancially larger savings...
And - since in your rant you're also giving the indian continent a kick - yet another thing:
My sister in law was meanwhile forced to change her job because the contractor of her Madras based company
expects the Indian IT staff to work nine months per year in Omaha.
Highly motivated and for an Indian salary, naturally.
If you're unable to get work because of ageist attitudes, it's another matter entirely, and I'd be sympathetic (though if I was you I'd reflect on my attitude a bit - you don't come accross as much of a team player for example). BTW, if you're currently unemployed, what are you living from? Accepting money from the evil socialist welfare state?
As you're getting nearer to retirement age (guessing from what you said), you should be concerned when large amounts of public money is wasted as bribe to large companies, instead of being used for pensions and the health service - those hip-replacement operations aren't cheap you know.
Arguing that companies should be able to fire people willy nilly, despite public subsidy, so you (theoretically) would have a better chance of getting a new job is ignoble.
Also Sweden has a completey different attitude towards imigration (and intergration) than Japan, so the aging population problem (as all countires in western Europe) shouldn't be as extreme. A bad comparison to make.
Can I just echo
The comment above that says "Outsource the Board". And folk here are claiming that we need to make it easier to fire people? Let's start with the workshy, tax-dodging benefit scroungers at the top of organisations.
I'm not joking but I'll take the red and black hoodie, ta.