Areva starts the most important restructuring of its corporate history.

Areva and labour costs: improving the financial position

VERONIQUE LE BILLON / ON MAY 5TH, LES ÉCHOS

 The nuclear group, facing important losses, announced its targets to staff representatives on Thursday. - AFP PHOTO / CHARLY TRIBALLEAU



Areva has started negotiations in order to reduce its world position number by 6,000 on a three-years’ time, namely 14% of labour force.

That’s only a start. On Thursday, Philippe Knoche, the group managing director, announced a target set at a 15% reduction of labour costs in France and another 18% in the world by 2017 to the trade unions representatives . As such, this target will amount to 3,000 or 4,000 job cuts in France within a three years time’s, which, at the world scale, would amount to 5,000-6,000 jobs cuts, the highest this figure be, the best. This will amount to a 14% cut in world labour force for the public nuclear company, which counted around 44,000 positions in late 2014 (among which 28,500 are located in France).
The direction spoke to the staff representatives straightforwardly : labour costs amounted to €3,3 billion (€2,4 billion in France), whereas its revenues amounted to €8,3 billion last year (falling by 8%). This situation has become unbearable because of the heavy loss suffered by the group last year (namely €4,8 billion, among which €2,6 billion of operational loss).

Different means will be used during the negotiation of a « transition agreement », whose discussions shall start tomorrow and last until next month. Indeed the group expects to negotiate with the trade unions an early retirement plan for the staff, whose age is close to retirement age, which is the case for 2,800 workers aged more than 57 years. Moreover, a voluntary early departure programme will be launched, dedicated to support functions, among which « the group has opened many positions », according to the HR manager, during the 2000s – and these positions amount to 4,100 jobs in France. Particularly, the number of hierarchic levels shall be reduced.

In its foreign subsidiaries, Areva has already announced 1,500 job cuts in Germany and launched a voluntary departure plan together with redundancies in the United States. « In France, there won’t be any redundancy and all production sites shall be protected », said the Economy Minister to AFP. He will convene the trade unions on May, 22nd. Volunteers to departure shall meet several conditions and work in the targeted plants. Nevertheless, "the management is aware that these measures won’t be enough and expects some « suggested » mobilities, and even forecasts redundancies », indicated FO (left-wing trade union) in a press release on Thursday yet.

Overhauling

In order to reach the targeted €600 million of expense cuts by 2017, Areva intends to modify some personnel agreements and to revise its staff’s total remuneration. Incentive agreements shall be reviewed drastically, following their expiry date. « It’s impossible to share what one does not own », says François Nogué. Although the financial statements have been in red since 2011, the group shall pay some 7 to 8% of profit-sharing for 2014. According to an incentive scale, profit-sharing for 2014 amounts to €2,000 to €6,000 per worker, with a company additional funding of €800, but that shall be also modified, as the present 40 agreements will be set into a global settlement for all the company.
Moreover, working time will be also revised. Following the company from which the staff comes (former Cogema or former Framatome), executives, who are working according a fixed-day basis, work some 202 and 218 days yearly (218 days being the threshold set by the collective agreement).« That’s a shock for workers who felt protected and taking profit of a quasi-public status. The most difficult thing facing the group shall be how to convince the 85% of the remaining staff whereas there is no corporate project », observes a former worker.
Sub-contractors won’t escape this complete overhauling : as the group intends to reach the € billion of expenditure cuts by 2017, Areva expects to reduce its external expenditures by €340 million.

http://www.lesechos.fr/industrie-services/energie-environnement/02154531581-areva-veut-reduire-ses-frais-de-personnel-de-15-en-france-dici-a-2017-1117434.php
http://www.areva.com/EN/news-10522/areva-launches-negotiations-with-labor-organizations-on-social-component-of-competitiveness-plan.html
http://www.usinenouvelle.com/editorial/rien-ne-va-plus-chez-areva.N315659

Read also in this blog:
http://energygeopole.blogspot.com/2015/04/areva-reviews-forging-inspections.html
http://energygeopole.blogspot.com/2015/03/todays-article-will-deal-with-arevas.html
http://energygeopole.blogspot.com/2015/02/edf-and-areva-face-over-cost-in-nuclear.html