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combination of demographic transition reducing the availability of labour in many countries and the displacement of economic growth centres, in particular to developing
countries, could be at the origin of the need to ensure employee mobility within MNEs.
Danone
As regards health coverage DanCares, headquarters provides a framework for each contingency maternity, hospitalization, outpatient based on three criteria quality, accessibility, out of pocket payment.
The harmonization of medical coverage plans is encouraged between subsidiaries within the same country.
Air France–KLM
The Group is careful to ensure that the services offered are not a barrier to international mobility for local talent. The system as a whole must have a certain logic and homogeneity.
3.2.3.2. A matter of costs The harmonization of social protection gives companies better control over their
compensation and benefits strategy. This control is now necessary because MNEs must comply with international accounting standards, including IAS 19 see note 20
above, which is of direct relevance to the obligation to fund companys liabilities including social
protection coverage for employees.
Excerpt from the Veolia Environnement Reference Document 2011
Due to its international dimension, the Company must take these factors into account and ensure that it: […] ensures the appropriate management of the Company by seeking to manage the costs associated with
liabilities that fall within the scope of IAS 19.
Excerpt from the Sanofi Reference Document 2010
The year 2010 was devoted to ensuring and maintaining the balance of health insurance schemes established in 2007. The current balance allowed some improvements of benefit levels without extra funding sources,
resulting in the signing of an amendment to existing agreements.
Some respondents also cited the need for a global retribution package policy, consolidated at group level, to cope with the demands of financial monitoring and also in
order to control costs. Indeed, the harmonization of social protection allows among other things the negotiation of a single group insurance contract and the use of technical
mechanisms such as pooling to reduce costs.
Veolia Environnement
We are currently developing a governance system with a procedure for pooling insurance costs at the country level. The goal is to have more consistency throughout our divisions by pooling providers insurers and brokers
by country.
3.3. The formalization of corporate commitments
The Company may commit to carry out social protection action for all employees supplementary to the statutory system where there is already provision for the
contingencies that the company wishes to cover:
■
either by negotiating with international trade union organizations across the group, in this case by signing an IFA; or
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unilaterally, in accordance with local statutory requirement for companies to bargain collectively on this topic. In this case, the company may finance the entire social
protection contributionpremium.
However, the fact that the policy originates from a unilateral undertaking or the outcome of negotiations with employee representatives does not seem to influence the
content and services offered. These are either a reflection of a broader strategy from the group management board and pre-exist any dialogue, or the result of harmonization of the
company’s existing social security programmes.
3.3.1. Commitments negotiated with global union federations
Of the 15 companies interviewed in the survey, only two have signed IFAs that provide worldwide coverage for their employees. Even these commitments relate only to
means and do not include a definition of worldwide coverage levels. It would seem that social protection is not yet a central issue in international
negotiations between employers’ and workers’ organizations, which may explain why few agreements include provisions on social protection at the corporate level. However, the
more recent commitments discussed in the first part of this study show the increasing interest of these organizations in the issue.
DanoneIUF in 2011
Dan’Cares action plan is intended to provide minimum medical coverage for all employees, primarily by ensuring that fundamental needs inpatient and outpatient care as well as maternity are covered by local
schemes andor insurance cofinanced by Danone companies and its employees, at a cost and of a quality and accessibility above or at least equal to those offered by other locally established international groups.
The application of the Dan’Cares action plan could be the subject of dialogue between the trade unions andor staff representative bodies. Subject to local legislation, where staffs are asked to contribute, the introduction of
health insurance shall be the subject of negotiation. Employees of all Danone companies shall be covered under a disabilitysurvivor insurance scheme.
3.3.2. Unilateral corporate commitments
Among the companies surveyed, few have passed the stage of stock taking of existing social benefits in order to develop a comprehensive strategy and deploy it in every
subsidiary. Most of those that have already implemented their strategy have extended their social
protection programmes unilaterally. However, the implementation of these programmes is in accordance with local legislation and the obligation for the company to negotiate with
workers’ representatives on these issues. Compensation is often one of the issues negotiated, with social protection being part of the overall compensation package. This
means that unilateral commitments by companies at the international level often lead to the signing of agreements with trade unions at the local level.
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Carrefour website: Providing benefits to all our employees
In all countries where it operates, the Carrefour Group ensures that its employees receive adequate social protection. Where a social security system is inadequate, the Group implements health, pension and retirement
plans, either as a substitute for the failings of local regimes, or to complement them. Source: http:www.carrefour.com, consulted in French on 8 Aug.2012 [our translation].
Total
The strategy with respect to social benefits was clearly defined at Group level. It is always implemented in compliance with the labour laws and thus may involve an element of dialogue with social partners.
The interviews show that in many countries the company pays the entire premium, which facilitates making a unilateral decision. Many multinationals thus see this as the
fastest way to provide social protection coverage for all employees worldwide. Of course, this does not avoid social dialogue at the time of implementation, or choices concerning
optional coverage, especially at the local level.
3.4. The stock taking phase
The MNEs chosen for this study were pre-selected for having made public their engagement to provide social protection to all their employees. However, this does not
mean that their initiatives are all at the same stage of implementation. Thus, six of them were still in the stock taking phase when they were interviewed.
3.4.1. Functions involved
To assess the feasibility of their engagement, the respondents had to take stock of their current social protection practices for employees at all their worksites. They
mobilized a range of stakeholders to achieve this, with the HR department at the forefront, supported by other functions finance, procurement, CSR if any when their expertise was
needed.
3.4.1.1. The human resources department The subjects of compensation and benefits, including social protection, are technical
issues implicating corporate human resources policy. Thus, among the companies surveyed, the stock taking of existing coverage and wider piloting of the implementation of
harmonized social protection programmes was generally conducted by the “compensation”, “compensation and benefits”, “social affairs” or “social relations” office
within the human resources department.
France Télécom - Orange
The inventory is conducted by the Corporate Remuneration Department, co-piloted with the CSR Department. Health and safety policy is managed at Group level by the Department of Social Relations, Health Safety
division. At the local level, it is the head of HR of the subsidiary that supports the project.
Sanofi
Human Relations management is responsible for the stock taking. Human Resources provides support to subsidiaries and the Procurement management is responsible for negotiating cost with providers.
However, as a general rule, few of the respondents involved departments other than HR, even when the social protection process was extended to the families of employees or
the surrounding community.
