Societas Europeae" Ancient Name, New Concept

By ILO

The recently formed Scandinavian bank - Nordea is to become a Societas Europeae (SE) with implications for trade union structures and tactics.

The European Union plan to allow multinational companies to incorporate as "European companies" is a reality as from October 2004. The new company registration can be established in two ways: by the merger of two or more EU based entities or by the creation of joint holding companies or subsidiaries.

Nordea is a merger of banks from Sweden, Finland, Denmark and Norway. The company finds the complexities of the differing legal structures confusing and impacting on efficiency, so using European wide structures enables a simpler operational approach.

Unions see this as a crucial test case for the SE model. The EU Directive of Worker Involvement In the European Company gives workers and directors detailed and complex procedures for negotiating how employees will be consulted, differing from the well-established Works Council rules. For example companies planning to establish an SE must take the lead in initiating negotiations with unions, through the establishment of a Special Negotiating Body.

Nordea has a strong tradition of social partnership and in line with existing Scandinavian law, unions are represented on the board. Unions also have to deal with cross-national union connections. Unions are nationally based, so must seek structures that will allow bargaining across national frontiers, rather than allowing different jurisdictions separate agreements.

A cross-union working party has already reported on the possibility of "One Company One Union". One of its proposals was the establishment of an independently constituted multinational Nordea union. This is seen as a longer term goal, with the initially to establish framework agreements across the national finance sector unions.

(ILO World of Work; no 52, November 2004)