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AIAS Amsterdam Institute for Advanced labour Studies Liberalisation and consequences for employ- ment in the Dutch postal sector Maarten van Klaveren No. 2014-02 AIAS Paper Series on the Labour Market and Industrial Relations in the Netherlands

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AIASAmsterdam Institute for

Advanced labour Studies

Liberalisation and consequences for employ-ment in the Dutch postal sector

Maarten van Klaveren

No. 2014-02

AIAS Paper Series on the Labour Market and Industrial Relations in the Netherlands

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© Maarten van Klaveren 2014

Bibliographic informationKlaveren van, M. (2014). Liberalisation and consequences for employment in the Dutch postal sec-tor. University of Amsterdam. AIAS ‘Labour markets and industrial relations in the Netherlands’ series, no. 2014-02.

This report was prepared as part of the overview report on Liberalisation and privatisation of postal markets, commissioned by UNI Europa Post and logistics and produced by the Forschungs- und Beratungsstelle Arbeitswelt (FORBA) in Vienna http://www.uniglobalunion.org/sites/default/fi les/fi les/news/post_report_forba.pdfReport Publication Date: December 2013

Information may be quoted provided the source is stated accurately and clearly. Reproduction for own/internal use is permitted.

This paper can be downloaded from our website www.uva-aias.net under the section: Publications/NL Industrial Relations series.

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Liberalisation and consequences for

employment in the Dutch postal sector

AIAS publication seriesLabour markets and industrial relations in the Netherlands

No. 2014-02

Maarten van Klaveren

Amsterdam Institute for Advanced labour Studies (AIAS)University of Amsterdam

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Table of contents

1. HISTORY UNTIL PRIVATISATION .....................................................................................................7

2. 1986 AND FURTHER: PRIVATISATION ...........................................................................................11

3. DEVELOPMENTS IN THE POSTAL MARKET: CHRONOLOGICAL OVERVIEW ..................................................17

4. DEVELOPMENT OF MARKET SHARES ..............................................................................................31

5. DEVELOPMENT OF EMPLOYMENT .................................................................................................33

6. DEVELOPMENT OF PAY AND CONDITIONS ......................................................................................35

REFERENCES .................................................................................................................................37

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1. History until privatisation

In the fi rst half of the 18th century, in the Netherlands ownership of postal services was transferred

from a city level to a state (current: provincial) level. In 1752, a new postal service was established, Staten-

post, which granted regional monopoly status to each of the state-run post offi ces. Yet, it was not until the

end of the century that Statenpost was reorganized into a single, national service. On 15 January 1799, in

the Napoleon era, the state declared to have the monopoly concerning letter post. In 1807, the country’s fi rst

Postal Act followed, setting up regulations on the collection, transport, and delivery of letters. Rates were

made uniform across the nation, based on weights and distances. When the French had left, King William I

maintained this system. The Postal Act of 1850 mandated that the postal service existed to serve the public

interest. Postal tariffs were simplifi ed and lowered, and the postage stamp made its debut in 1852. That same

year, every Dutch municipality acquired what were essentially post offi ces, where letters were posted for

delivery and collected (www.encyclopedia.com; Davids 1999; Post NL 2013).

Meanwhile, in 1845 the fi rst electrical telegraph line had been built in the Netherlands. Two years later,

a Royal Decree set strict standards for telegraph traffi c, including tariffs, in 1851 followed by the Telegraph

Act. It lasted until 1886 before the two governmental services, ‘Post’ and ‘Telegraph’, were united into one,

Post. Telephone was introduced in 1877. At fi rst this technology was integrated in the telegraph infrastruc-

ture, mainly run by the municipal post offi ces. A Royal Decree as of 1881 regulated this integration, and

from 1897 on the government fi nanced the full infrastructure. Yet, the telephone networks themselves were

exploited by private fi rms (Lintsen 1993: 275-98). This changed from 1913 on, when the government started

nationalizing the private networks, in 1915 leading to the creation of the Administration of Post and Tel-

egraph (P & T). In 1928 P & T was restructured and named the State Undertaking of Post, Telegraph and

Telephone (Staatsbedrijf voor Post, Telegrafi e en Telefonie, PTT). At the same time, its administration was set up

along more commercial lines, though government and parliament did not go along with the pursuit of the

PTT management for real commercial elbow-room. The lack of such leeway, combined with the limitations

the government budget posed on longer-term investment plans, continued to create tensions between PTT

management and the responsible Minister of Transportation & Water Management. For example, time and

time again government and parliament rejected proposals of PTT to create an own investment fund. These

tensions remained in the fi rst two decades after World War II (Davids 1999: 114-7).

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By 1928, the wide network of local PTT offi ces already housed a number of ‘non-PTT’ activities,

including those of the Postal Savings Bank (Rijkspostspaarbank, RPS) and the Postal Cheque and Clearing

Service (Postcheque- en GiroDienst, PCGD). RPS was established in 1881 and, although using PTT premises,

remained formally independent for over a century, until 1986. In 1972, however, it had become materially

part of PTT’s Division Money Services. The PCGD was started up in 1918, following an initiative of the

Chambers of Commerce, aiming “to achieve an improvement of money transfer and facilitating payments”

(De Wit 1994: 31). After a failure due to a decentralized structure, in 1923, the centralized RPS/PCGD

services, using the front-offi ce of the local post offi ces, developed into a highly successful and smoothly

operating Giro service, after World War II internationally renowned as technologically leading, in particular

through the advanced adoption of mainframe computer systems (De Wit 1994). RPS/PCGD were the fi rst

to convince Dutch employers (and employees) of the advantages of giral over cash wage payments, and to

link giro payments to private savings accounts (Tijdens 1989).

Wim Duisenberg, Finance Minister in the centre-left Den Uyl administration, in 1973 revealed his plan

for the integration of PCGD (by then operating under the Postgiro label) and RPS in a Postbank as a re-

tail bank, in particular meant to fuel competition in Dutch retail banking. However, in 1977 the fall of the

Den Uyl cabinet suspended the parliamentary treatment of the Postbank bill. In different ways the delay

that followed played into the hands of the general banks. For the time being, PTT could only take minor

steps: in 1977 Postgiro and RPS were formally integrated in the PTT Division Money Services, and in 1979

this division took over the last municipal giro service, that of Amsterdam. In between, the general banks

had started a public campaign, fi ercely opposing the creation of what they invariably called ‘a State Bank’

(Schotsman 1990).

Concerning banking services, the four major Dutch general banks (ABN, AMRO, RABO and NMB)

since the mid-1960s had heavily automated as well as harmonised their payment processes. They closely

cooperated concerning their product and process innovations. In 1967 the four large banks initiated the

BankGiroCentrale (BGC) for the processing of their mutual payment and clearing activities, thus creating

a payment circuit of their own, besides that of the PCGD. BGC expanded rapidly.1 Government plans to

integrate both circuits in one National Payment Circuit (Nationaal Betalingscircuit, NBC) progressed only very

slowly2 (Tijdens 1993; Van Klaveren 2001). In the course of the 1970s, PCGD/RPS growingly had to cope

with heavy competitive pressure. Postgiro’s market share in Dutch private savings grew slightly, but its share

1 In 1994, BGC, BeaNet and Eurocard Nederland merged into Interpay; currently this clearing organisation is called Equens.2 And were only to be materialized in 1997 (Van Klaveren 2001: 4).

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in business savings eroded continuously. The overall perception, also within the PTT, was that Postgiro ie.

the Division Money Services had little to offer to business clients. In 1980-82, this Division suffered from

major losses. Moreover, irritations within PTT grew. The management of Money Services growingly felt

curtailed by the central PTT management. By contrast, the latter tried to tighten their control over this divi-

sion, aiming to keep it within PTT at any price. The central management found allies in the trade unions

of public servants. They emphasized the importance of a majority government share in Money Services

(Schotsman 1990). It may be added that these unions spawned a considerable, well-organized force: in 1985

47 per cent of PTT staff were unionized, for Dutch standards a very high fi gure (Davids 1999).3 In 1985,

the then centre-right coalition presented the defi nite Ruding-Smit Postbank bills. The explanatory memo-

randum stipulated that there was already sound competition in the Dutch banking market, and allowed only

defensive expansion of Postbank’s service offer -- thus delineating serious commercial limitations for the

new bank (Cf. Schotsman 1990).

For just seven years, between 1979 and 1986, PTT was a state fi rm integrating postal services, telecom-

munications, and money services. Though under central management, the three services operated largely

autonomous, and cross-fi nancing was quite limited (Schotsman 1990). At the time, PTT still held a mo-

nopoly for postal deliveries, but in telecommunications and banking major changes were already under way.

After World War II the Dutch government had heavily subsidized telephone infrastructure as to match the

exponentially growing demand for fi xed line telephone connections, but in the late 1980s that demand satu-

rated.4 At the same time, telecommunications and computer technology began to converge, and the result-

ing needed datacommunication facilities linked with digitalisation required immense amounts of investment

(De Wit 1994).

3 The union density in Money Services must have been at about the same level. Though falling after the formation of the Postbank, in 1994-95 union density among the Postbank staff was still approximately 40 per cent (author’s interviews for Van Klaveren and Van de Camp 1994 and for call centre project FNV Bondgenoten, carried out in ING Bank).

4 Telegraph use declined already earlier, from 1955 on (De Wit 1994: 32).

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2. 1986 and further: privatisation

Finally, the government per 1 January 1986 allowed PTT to privatise its Division Money Services by

then employing about 10,000, into Postbank NV. Its workforce lost its public servant status, but on them

the conditions of the general banking collective agreement were applied -- de jure meaning a loss of job se-

curity, but de facto in this respect implying hardly any change, whereas especially for the lower wage groups

remuneration levels went up by 5 to 10 per cent (interviews for Van Klaveren and Van de Camp 1994)5. An

agreement between Postbank and PTT settled the continuous use of the post offi ces on behalf of Postbank

clients. The next mergers followed suit. In 1989, Postbank merged with the NMB Bank into NMB Postbank

Groep. In 1990 its major competitors, Algemene Bank Nederland (ABN) and AMRO Bank, merged into

ABN AMRO; subsequently, in Spring 1991 NMB Postbank Groep merged with the Nationale-Nederlanden

insurance company, as to form the ING Bank; the state received ING shares, that were sold again in 1993,

1997 and 2002 (Stellinga 2012). In 2009, the Postbank label disappeared altogether, when the Postbank op-

eration was fully integrated into the ING Bank, that from then took on the name ING.

Concerning liberalisation a next important step took place by 1 January 1989, when the Dutch state gave

the State Company of PTT, by then having lost its banking stronghold, a formally independent or ‘Quango’

status though it remained state-owned. Adorned with the predicate Royal (‘Koninklijk’), the company was

transformed into Koninklijke PTT Nederland NV (‘Royal PTT Netherlands plc’) Dutch or KPN, with PTT

Post BV and PTT Telecom BV as its main subsidiaries. At the same time and based on a change in the so-

called Enabling Act (‘Machtigingswet’), the state handed over the exclusive concession of the paid distribu-

tion of letters of maximum 500 g to PTT Post (Cf. Annual Report TPG 1997). In 1992, PTT Post joined

with the postal services of Sweden, France, Germany and Canada to acquire 50 per cent of GD Express

Worldwide (GDEW). The other half-interest in GDEW remained with the Australian fi rm Thomas Nation-

wide Transport Ltd (TNT), which had created it. Operating under the trade name TNT Express Worldwide,

GDEW combined the express mail and parcel activities of TNT and the fi ve postal services. This marked

the beginning of the increasingly close relationship between PTT Post and TNT (website encyclopedia.com)

In 1993, the post offi ce buildings as well as the front offi ce workers of both PTT Post and Postbank

were set aside under a separate legal entity, Postkantoren BV, 50/50 owned by PTT Post (later to become

TPG) and Postbank. The front offi ce workers executed functions in behalf of both PTT Post and Postbank

5 Note that public sector-workers in the 1980s encountered a wage penalty compared to those in private industry, partly due to governmental wage freezes, partly due to wage moderation like agreed in the 1982 Wassenaar Accord (Salverda et al 2008; Berkhout and Salverda 2013).

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as a kind of ‘one-stop-shop’: they sold stamps and a range of offi ce articles, took in letters and packages

from dispatching clients, and sold Postbank banking services (Cf. AbvaKabo FNV 2009). The creation

of the Postkantoren entity clearly was a ‘graveyard construction’ (Dutch: ‘sterfhuisconstructie’), aiming at

selling the post offi ces and getting rid of superfl uous staff as smooth as possible. By October 2011, all op-

erational activities of Postkantoren BV were ended; by then, all ‘classical’ post offi ces, in the fi nal stage still

250, had been closed down. Post-linked activities have been transferred to about 2,400 selling points (still

called ‘post offi ces’) in supermarkets, book stores and the like, and banking activities were transferred to the

ING Bank (Het Parool 2011).

Until 1994, the state remained KPN’s sole shareholder. In that year, KPN was given corporate autonomy

and it became a joint stock company. This process of ‘corporatisation’ was followed by real privatisation: in

1994 a fi rst tranche of 30 per cent and in 1995 a second tranche of 25 per cent of the KPN shares were sold

on the stock market. Subsequently, in 1997-98 an independent telecommunications authority or ‘watchdog’

(Onafhankelijke Post en Telecommunicatie Autoriteit, OPTA) and a semi-independent6 anti-trust authority

(Nederlandse Mededingingsautoriteit, NMA) were put into place, based on the Competition Act (Mededin-

gingswet) that adopted much stricter rules against cartels than earlier legislation (Hulsink 2001).7

At the time, the dominant opinion of industry analysts concerning KPN was clear: the company had to

transform rapidly into a genuine telecom fi rm, and had to get rid of the postal subsidiary, that was regarded

as deadweight and might return to the state. KPN, and notably its CEO Wim Dik, continuously denied to

have plans in this direction, and indeed had the company as a unity apply to an offi cial quotation. A major

event took place in December 1996, when KPN realised a friendly takeover of TNT. It planned to integrate

this fi rm with its own post division. Initially, the majority of Dutch fi nancial journalists and analysts was

jubilant, regarding this take-over as a major step in KPN’s postal activities gaining adequate scale of opera-

tion. Yet, already in June 1997 CEO Dik announced that ‘post’ and ‘telecom’ would split up: the telecom-

munications division was to continue as KPN, and the post, express mail and logistics divisions as the TNT

Post Group NV, or TPG -- with both added ‘Royal’ again. This separation was effected in June 1998. (Yet,

the PTT Post label would remain in use until 2002, when it was replaced by the TPG Post label).

In 1997, the fi rst step to complete liberalisation of the national postal markets was taken. Under the

European Postal Directive, national postal operators in the European Union were required to provide a

number of services in return for a monopoly over part of the postal market. For TNT Post this meant

6 Situation at its inception; as per 1 July 2005 changed into an independent body.7 As per 1 April 2013, these authorities and the Consumers’ Authority have been integrated in the Authority Consumer and

Market (ACM).

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that they were required to carry all letters and parcels not exceeding 10 kg at affordable and uniform rates,

independent of the origin and destination within the Netherlands. They were also required to collect and

deliver postal items not exceeding 2 kg six times a week and guarantee next-day delivery of 95 per cent of

domestic mail. In return, TNT Post was granted the monopoly for concession mail not exceeding 50 g (the

‘reserved area’8). The plain 1997 fi gures revealed that for the Post Group the scale problem persisted, and

would become even more urgent against the backdrop of the Postal Directive: the 1997 turnover of newly-

formed TPG was about two-thirds of that of UK’s Royal Mail, and about half of the turnover of Deutsche

Post and La Poste. Moreover, TPG chairman Ad Scheepbouwer still had to fi nalize the ‘Briefpost 2000’

reorganisation already set in motion in 1990, as well as to integrate the operations of PTT Post and TNT.

Scheepbouwer saw a technical solution as the main way-out: the rapid automation and centralisation of the

post sorting process, aiming at the automatic sorting of about 90 per cent of letter post (Against a European

average of about 10 per cent: Breedeveld 1999).

INTERMEZZO: THE AUTOMATION OF POST SORTING

In 1930, PTT in its Rotterdam post offi ce introduced the fi rst post sorting machine in the world. This Transorma machine was initiated and developed by a PTT employee, in later years jointly with a Technical University professor. While a worker’s maximum manual sorting capacity is about 1,800 letters hourly, Transorma’s capacity was 3,000 letters per hour: yet a limited produc-tivity increase, projected against considerable purchase and maintenance costs. Moreover, the machine operators had to be skilled and trained. All in all, 20 Transormas have been operational. As their successor, PTT’s Dr Neher Lab developed the Codeer sorting machine, that became operational in 1966. Though this machine at large had a capacity of 20,000 letters hourly, at 2,500 letters per hour the individual operator’s capacity remained lower than that of the Transorma. From a business viewpoint, the main advance was that lower-skilled (and paid) operators could run the Codeer operation. Moreover, the related logistics operation was drastically simplifi ed, and throughout the 1970s the number of Nodal Expeditions Points (Expeditie Knooppunten, EKPs) where the primary coding activities are executed, was brought down from 45 to ten. High were the expectations for a productivity rise in sorting when in 1978 the national postcode sys-tem was introduced. PTT management regarded this introduction, linked with ‘fully automated sorting, as the only viable way to mitigate the expansion of the PTT workforce. Yet, in 1979-80 a sorting machine that required manual indexing of the post codes (mainly executed by female part-time operators in evening shifts), turned out to be uneconomical. In the years to follow the introduction of scanning software with Optical Character Recognition (OCR) fi nally meant a breakthrough in reading addresses and sorting, and by 1990 the productivity of a sorting machine in the EKPs was lifted to 30,000 - 40,000 letters hourly. The main technical problem remaining was that of incomplete or wrongly indicated postcodes (IPSO 1981; website Museum voor Com-municatie). In 2010, PostNL ‘solved’ that through a low-cost solution: fully offshoring its process of video-coding to multiple sites in South-East Asia.9

8 Unlike in most neighbouring countries, direct mail has not been included under monopoly rights in the Netherlands.9 “Where up to 14,000 people are ready to deliver the correct data back in real time” (text movie on http://shore.postnl.nl/nl/

postal_automation).

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For the time being, both TPG and KPN continued to pursue international ambitions. KPN seemed

to fulfi l such ambitions when it played a major role in mobile Internet frequency auctions and, in 2000,

took-over the German mobile provider E-Plus. In doing so, it built up huge debts, and only one year later

the burst of the Internet bubble brought KPN on the verge of bankruptcy. Yet Scheepmaker, the newly

appointed CEO, initially succeeded in restoring profi tability. In 2011 problems mounted again, and Eelco

Blok, the new KPN CEO, announced the dismissal of a quarter of the company’s Dutch workforce fol-

lowed by, in early 2013, the selling of ‘crown jewel’ E-Plus. Currently, KPN is subject of a fi ght with Mexi-

can telecom giant América Móvil, that has threatened to drop its earlier Euro 7.2 billion bid to take over

KPN after temporarily being blocked by an independent foundation charged with protecting the telecom

group. The foundation, composed of fi ve senior Dutch corporate executives, among other things has ar-

gued that América Móvil did not behave “according to good Dutch standards” and that the selling of Dutch

telecom networks does not serve the Dutch public interest (Financial Times 2013).

Initially, TPG clearly did better than KPG. Between 1998 and 2005, TPG expanded in the logistics

market through an internationalisation strategy, taking over several medium-sized logistics companies from

Germany, Italy and other European countries. In 2006 it renamed itself into TNT, with a stock exchange

quotation in New York. In November of that year, TNT sold its Logistics division to Apollo Management,

as to focus on network activities, mail and express delivery services. The remaining divisions were called

TNT Post (instead of TPG Post) and TNT Express. In May 2007, TNT announced its delisting from the

New York Stock Exchange.

From the mid-2000s on it became clear that, while the operations of TNT Express showed considerable

growth, the expansion potential in Europe of TNT Post was quite limited. The post division in particular

in Germany and Italy met fi erce competition, with its management complaining that European liberalisa-

tion was frustrated by the governments of large countries, and that national monopolies continued to enjoy

protection in their home markets like through keeping their operations exempt from value-added tax (VAT).

Partly because of the lack of postal expansion, the synergy advantages between Post and Express continued

to be smaller than expected. Thus, it did not come as a surprise when in December 2009 TNT admitted to

give up the European ambitions of its postal subsidiary. TNT at large came under fi re of aggressive hedge

funds, like US-based Jana Partners. Together with Canadian pension investor Aimco, since 2 December 2009

Jana Partners owned over 5 per cent of TNT Post’s shares, and obviously pressed to have the fi rm demerge

in an express and a mail part. Then most likely TNT Post would focus on the Dutch market. According to

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analysts, if the express division was to be split off, it would become easier to assign a value to it; in that case

selling it off to US competitors UPS or FedEx would become a viable option. Yet, the chair of the TNT

Post board, Peter Bakker, maintained that no plans for a split had been proposed to him; he also said to

believe that splitting up TNT would not serve TNT Post’s best interests (Klok 2009; Grünell 2009; Schaap-

man 2010). Against all odds, in August 2010 TNT announced its intention to split, though it lasted until May

2011 when a general meeting of TNT shareholders approved to demerge the fi rm’s Express Business. By

26 May 2011 the Express division was legally separated and brought under TNT Express NV, whereas TNT

NV changed into PostNL NV (‘PNL’ at the Amsterdam stock exchange -- press release PostNL).

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3. Developments in the postal market: chronological overview

3.1. Introduction

By 2007, the legal framework concerning the Dutch postal market was set as follows. The market for

the delivery of printed matter had been liberalised in 1988. There have been disputes about the defi nition

of addressed printed matter and ultimately it was decided that direct mail should be considered like that

and that hence this market was open to competition. The further gradual reduction of the reserved area

(in particular for the delivery of items of correspondence) has been in line with the EU postal directives.

In 2000, the government lowered the yardstick for the letter monopoly from 500 to 100 g. By 2007, the

reserved area consisted of the conveyance of domestic mail less than 50 g (and priced lower than 2.5 times

the stamp prices), with the exception of outgoing cross-border mail. Experts described the position of

OPTA as rather strong, but noted a number of limitations. They observed that the Ministry of Economic

Affairs did have quite some power, including inter alia setting (guidelines on) postal rates and preventing

unfair competition (ECORYS 2007: 6-7).

Competition basically developed as follows. The promise of full liberalisation laid down in the Postal

Directive and initial Dutch steps in that direction stimulated the entry of new parties and forced the former

monopolist into major reorganisations. New entrants in the postal market were, in 2000 (effective 2001),

Sandd and, in 2002, SelektMail, both focusing on the rapidly growing business-to-consumer segment of

pre-sorted bulk mail, mostly maintaining two deliveries a week. The two newcomers used small local or

regional mail service operators, started a few years after the 1988 liberalisation and mostly ‘mum-and-dad’

businesses, for building nationwide delivery networks. Between 2001 and 2006, their combined market

shares in the total addressed mail market grew from zero to 11.2 per cent -- which meant, in a market with

stabilised post volumes, a fall in delivery volume of TNT Post by about 10 per cent (Tables 1A and 1B, be-

low). Both newcomers had ambitions to target the market for consumer post as soon as that market would

be liberalised.10 Yet the realisation of those ambitions was going to diverge. Until 2009 SelektMail was a joint

venture of Deutsche Post DHL and Dutch publishing company Wegener; in that year it was fully integrated

10 It may be noted that with regard to Value-Added Tax (VAT) there has been and is a level playing fi eld in the Netherlands. The delivery of printed matter and unaddressed mail is subject to VAT, no fi rm excepted.

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in DHL Global Mail. Both TNT and Sandd repeatedly accused SelektMail to pursue price dumping (Cf.

Stoker 2010). In 2010 it became clear that this policy would most likely led to the further accumulation of

losses; thus, Deutsche Post DHL decided to leave the Dutch postal market. By 29 April 2011, Sandd for-

mally took over its former competitor from the German postal giant. The unions said to be glad with this

outcome, as they expected it to end, what they called, the price war at the Dutch postal market (Volkskrant

2011), an expectation they shared with experts (Niederprüm et al 2011: 28). That price war took place in

a market that from 2006 on, under pressure of the rise of the Internet and other new means of commu-

nication, shrunk progressively: from 2006-2009, when also TNT subsidiary Netwerk VSO had entered,

domestic post volumes fell by nearly 12 per cent, from 2009-2012 by nearly 20 per cent (Based on Table

1A, below). Continuation of this decrease should be expected: a study on future developments in the Dutch

postal market carried out in 2011 expected volumes in the domestic market to decline in 2010-2020 by 26

to 47 per cent, depending on the scenarios used (Niederprüm et al 2011). The policy logic in such a shrink-

ing market with hardly any product differentiation is a basic fi ght to try and bring down cost prices through

enlarging volumes -- which is exactly what happened between 2006 and 2012 (Cf. Baarsma and Weda 2009).

In the next sections, we will describe developments in the Dutch postal market, mainly in the legal and

industrial relation fi elds, in chronological order starting in 2007.

3.2. 2007

In January 2007, TNT started up Netwerk VSP Geadresseerd, clearly meant as a direct competitor for

Sandd and SelektMail but a full TNT subsidiary.11 (In November 2011, Netwerk VSP Geadresseerd decided

to end its activities on the market of addressed post, as this market would not allow profi table activities.

Netwerk VSP continued its deliveries of unaddressed folder mail (website Netwerk VSP)).

TNT started to apply, besides the main CLA, a separate CLA for post deliverers (letter carriers, Dutch:

postbestellers, the term TNT uses, or postverspreiders, as termed by the new entrants) and another CLA for de-

liverers working only Saturdays. As for 2006-2007 no wage increase was negotiated, the minimum hourly

rate for post deliverers fell below the national hourly Statutory Minimum Wage (SMW) for adults 23 years

and older. This was corrected in the CLA negotiated in 2007, in which the basic hourly wage in the lowest

wage scale was equal to the SMW (AbvaKabo FNV 2009; the decrease below the SMW would be repeated

in 2011-12). This was already an example of wage pressure exerted by the new entrants. The unions pursued

11 This weakened the ground for the recurrent complaints of TNT concerning price dumping by SelektMail ie. Deutsche Post DHL (Cf. Baarsma cited by Stoker 2010).

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active publication and lobbying strategies in order to make such effects known. In March 2007, the FNV

confederation and the fi ve unions involved in the postal industry published a manifesto, “Liberalisation of

the Dutch post market leads to undesirable wage competition.” It explored the wages and conditions paid

by respectively TNT and the new competitors (see below, under 2008). It argued that already 9,000 full-time

breadwinner jobs at TNT Post were shed, and confronted that with the 20,000 marginal part-time jobs at

Sandd and SelektMail, with earnings largely insuffi cient to cater for a decent life. The unions plead for an

industry CLA, providing a wage fl oor, as well as a labour contract based on the SMW for each post deliverer.

The unions proposed that the government would amend the Postal Act likewise (FNV et al 2007). However,

on 5 June a majority of the House of Representatives (Tweede Kamer), including the Labour Party (Partij van

de Arbeid) and the Christian-Democrat Appel (CDA), voted in favour of a Postal bill without such amend-

ments.

In 2007 the social disadvantages of rather chaotic and market-driven liberalisation growingly came to

the fore. First, on 3 April TNT announced that between 6,500 and 7,000 jobs needed to be shed at TNT

Post and that substantial cuts in wages and conditions were also inevitable; if not, at least 11,000 jobs would

be shed and forced dismissals might be needed. Spokeswoman Inge Bakker of the CNV Publieke Zaak

unions reacted that of course, the unions do not close their eyes for developments under way in the postal

sector, but that they did not expect the size and speed of the reorganisations TNT just revealed. She plead

for adequate arrangements for voluntary dismissal (website Nu.nl 2007).

In early December the FNV Bondgenoten union published a Black Book (Dutch: Zwartboek) on the re-

ality of the Dutch post deliverers in particular those working for Sandd and SelektMail. It contained detailed

information on workforce composition, wages and conditions of these fi rms, largely based on interviews

of union offi cials. It became abundantly clear that rewards in these fi rms were based on piece rate systems,

and on an hourly basis were below the SMW. Yet, as a large majority of workers had a so-called assignment

agreement (‘overeenkomst van opdracht’, OVO) and not a labour contract, they were not able to claim the em-

ployee status nor the SMW. The delivery workers do not have sickness or unemployment insurance, neither

do they build up pension rights. Although the fi rms at stake argue that they cannot offer better conditions

because of their particular market and the quest for fl exibility, the unions hold that they at least should pay

at SMW level (FNV Bondgenoten 2007; AbvaKabo FNV 2009). In Autumn 2007, union lobbyists focused

on efforts to bring Sandd and SelektMail under the obligation to use permanent labour contracts instead

of ‘OVOs’ based on piece-rates, and found a kind hearing in members of parliament, notably Labour Party

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representatives. The unions basically argued that in terms of labour conditions a level playing fi eld would be

missing if the government would decide to fully liberalize the postal market (Cf. union websites).

On December 7, three weeks before the planned further liberalisation of the postal market, Economic

Affairs State Secretary Frank Heemskerk (Labour Party) announced in the House of Representatives that

the government was to postpone liberalisation and full market opening envisaged for 1 January 2008. Mr

Heemskerk argued that too many uncertainties existed concerning the social implications of liberalisation

and concerning the existence of a level playing fi eld in the EU. He said to expect that in the course of the

fi rst half year of 2008, the situation would be clarifi ed and that thorough decision-making by then would

be possible. A majority of representatives agreed with this position. Whereas TNT Post found the decision

justifi ed, spokespersons of Sandd and SelektMail reacted furiously (Reformatorisch Dagblad 2007).

3.3. 2008

In April 2008, bargaining for a new TNT CLA broke; while the unions demanded 3.5 per cent nominal

wage increase, the offer of TNT stopped at 3.0 per cent. Yet, the underlying struggle was about the future

of the TNT Post organisation and that of the post(wo)man (letter carrier, in Dutch postbode) occupation.

On the eve of the relay strikes that the AbvaKabo FNV union had planned, TNT Post director, Harry

Koorstra, sparked the debate arguing that post(wo)men were paid about 25 per cent too much compared to

employees in comparable jobs elsewhere in the Netherlands. He referred to research of the AWVN general

employers’ association that compared postmen’s salaries, ranging from Euro 1,800 to 2,100 gross monthly,

with those of drivers and security workers. According to Koorstra, the times in which post(wo)man was a

full-time breadwinner’s job were defi nitely gone, and it would be a by-occupation, with wages related to the

Statutory Minimum Wage (SMW). He said to be willing to pay the 3.5 per cent wage increase demanded by

the unions, but only coupled with a total revision of the CLA structure with 25 per cent lower wage levels.12

That revision would also be needed as to avoid forced redundancies. In response, the unions repeated to

be aware that the gross labour costs of post(wo)men, Euro 22-24 hourly were quite high, both related to

those of a part-time post delivery worker (Euro 12) and those of post deliverers at Sandd and SelektMail

(Euro 6-8) (already calculated in FNV et al 2007). Jointly with TNT they had developed a plan for a new

CLA, including a 25 per cent cut in wages for newly hired staff, but they fi rst wanted the 3.5 per cent hike.

Moreover, they also wanted a more cautious and more phased introduction of changes for the incumbent

12 Which would have brought wage levels at 100-115 per cent of the adult SMW.

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staff than the ‘raw’ introduction preferred by TNT (website Flexnieuws 2008; AbvaKabo FNV 2009; web-

site AbvaKabo FNV13).

As said, AbvaKabo FNV initiated relay strikes of postal workers. After a month of strikes and under

the threat of a national postal strike on 28 May14, AbvaKabo FNV and the other unions involved (BVPP

and CNV Publieke Zaak) succeeded in negotiating a basic collective labour agreement (CLA) with TNT

Post. The agreement as of 23 May, covering one year from 1 April 2008 on, contained a structural pay rise

of 3.0 per cent backdated to 1 April and a one-off payment of 0.5 per cent per month, to be included in the

wage scales if a new collective agreement for so-called production workers would be realised before 1 April

2009. The unions made public that TNT had shelved earlier plans for drastic wage cuts (CBN June 2008).

In preparing for the post market deregulation, the unions had already pressed the new entrants, Sandd

and SelektMail, towards the negotiation table. In the subsequent negotiations also two private sector unions,

FNV Bondgenoten and CNV Bedrijvenbond, were involved. On 24 April 2008 four out of fi ve unions

(BVPP, CNV Publieke Zaak, CNV Bedrijvenbond and FNV Bondgenoten) signed a basic CLA accord with

Sandd and SelektMail. The AbvaKabo FNV union refused to sign, considering the accord too ‘soft’; in the

union’s view it offered its workers absolutely no prospects for a labour contract, or even payment of the

SMW. This position gave the State Secretary grounds for the further postponement of liberalisation, from 1

July 2008 to 1 January 2009. Based on the Accord of 2 April, on 12 November 2008 the same four unions

and the two fi rms signed a fi nal CLA, the so-called CLA Postverspreiders. It was agreed that the replacement

of 80 per cent of staff should be fi nalized within 42 months. Again, AbvaKabo FNV did not sign (Ab-

vaKabo FNV 2009; Grünell 2009).

The Sandd / Selektmail CLA and its interpretation was a crucial factor in the postal market liberalisation

process. The Dutch cabinet declared to have good hopes to bring the EU-agreed date of 1 January 2011

forward if suffi cient prospects for good terms and conditions of employment at the new entrants could

be guaranteed. We already referred to the position of Labour Party State Secretary, Frank Heemskerk. That

position was related to the view of his party in the House of Representatives, that these conditions would

be met if the FNV-affi liated unions had reached agreement with Sandd and SelektMail, agreement in which

‘OVO’ contracts should be replaced by permanent labour contracts. Representatives of the other major

coalition party, CDA, would not go that far. Yet, the fact that the main union, AbvaKabo FNV, continued

to regard the CLA too fl imsy and insubstantial, put the issue under pressure. This union argued that the

13 The plan envisaged a compensation for incumbent staff linked with tenure, of one monthly salary per year of tenure. 14 Union density at TNT Post was by 2008 with 35 per cent rather high for Dutch standards. AbvaKabo FNV had 11,000 mem-

bers at TNT Post, and CNV Publieke Zaak about 2,700. The other unions added up a few hundred members (Grünell 2008).

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agreement was without any form of sanction or binding conditions that would apply should the goal of

80 per cent replacement not be achieved. Sandd and SelektMail complicated the issue further; they said to

believe that their CLA would only apply if the postal services market was deregulated before 1 April 2009,

and asserted that they could only offer the employment conditions agreed upon in case of gaining access to

the market across the board. Mr Heemskerk reacted in saying that he expected no problems in this respect,

as the new companies would extend their focus beyond private individuals, by seeking to serve the business

market. He referred to the fact that fi rms, associations, foundations and bulk mail producers already ac-

counted for 92 per cent of all letters sent. Nevertheless, he intensifi ed consultation with all unions involved

(AbvaKabo FNV 2009; Grünell 2009).

3.4. 2009

The cabinet decided on February 20, 2009 that the postal market would be fully opened up on April 1,

2009, thus 15 months later than originally envisaged but 21 months earlier than prescribed by the European

Commission. On 24 March, the fi nal bill got a majority vote, with a rather limited minority of seven small

parties opposed and all large parties, including the Labour Party, in favour. Initially Article 8 of the new

Postal Act (Postwet, dated 30 March 2009) stipulated that “Through Temporary Decisions conditions can be

prescribed regarding labour conditions to be realised, if: a. work is done under social unacceptable labour

conditions; b. such a problem is limited to the postal sector; c. the problem cannot be solved by adaptation

of generally prescribed regulations or by agreement between the relevant employer and the representatives

of trade unions” (Staatsblad 2009a). A substantial part of the new Act (articles 14-31) was devoted to the

regulation of the Universal Postal Service (UPS, in Dutch Universele Postdienst, UPD).15 The Act stipulates

that also after 1 April 2009 and for indefi nite time the UPS will be carried out by a specifi c postal service

provider, to be determined by the Minister after a transparent selection procedure (art. 15.1). This was even-

tually to become TNT Post / PostNL, but as such this has not been stipulated by law.16

Shortly afterwards, the CLA Postverspreiders was amended in view of the new law. In March 2009, this

CLA was also signed by Netwerk VSP Geadresseerd and AbvaKabo FNV. It covered a 3.5-year period, from

1 April 2009 until 30 September 2012. In August 2009, all social partners agreed upon the fi nal text of this

CLA, and in September the CLA was mandatory extended by the Minister of Social Affairs and Employ-

15 At least, for the UPS is required: delivery of mail pieces, at least six days a week; creating locations where customers can drop off and pick up mail (mail locations). Added is the requirement to deliver at least 95 per cent of post offered the next day throughout the Netherlands (OPTA 2011).

16 Other than suggested in some reports (Cf. RebelGroup/SEO 2013: 14).

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ment. Briefl y afterwards, on 8 October 2009 State Secretary of Economic Affairs, Frank Heemskerk, and

Minister of Justice, Ernst Hirsch Ballin17, signed a Temporary Decision Labour Agreement Post (as a Gov-

ernmental Decree or AMVB, Algemene Maatregel van Bestuur). It tightened the conditions the government had

laid down earlier, stipulating that as from 1 January 2010 and until 1 April 2013 new entrants in the postal

markets were under the obligation to agree upon a permanent labour contract (Dutch: dienstbetrekking) with

all their post delivery workers. Exempt from this regulation were those postal fi rms agreeing upon a CLA

according to the CLA Act, under the condition that they fulfi lled a scheme in which latest after 42 months

at least 80 per cent of the postal deliverers should have been brought under the new Act, while in earlier

stages the following percentages should be attained: 10 per cent latest after 12 months, 30 per cent latest

after 24 months, and 60 per cent latest after 36 months. If for whatever reasons the social partners would

not prolong or end the CLA, the new entrants were allowed one half year as to realise 100 per cent labour

contracts (Staatsblad 2009).

The unions, in particular FNV Bondgenoten, welcomed the state intervention, as they regarded the

scheme of the Governmental Decree a stronger incentive for the desired change towards labour contracts

than the CLA. The governmental scheme was also tighter than that agreed in the CLA, that concluded to

minimal 14 per cent labour contracts to be attained after 15 months, ie. as per 1 April 2010. However, Sandd

and SelektMail (DHL) succesfully contested the Governmental Decree in court. The The Hague court

agreed that the Decree frustrated the right of employers and unions to negotiate freely. The unions reacted

with disappointment, whereas Secretary of State Frank Heemskerk re-assured: “Paramount is that a ‘race

to the bottom’ in terms of pay and conditions for post delivery workers must be avoided. The cabinet will

continue to pursue that goal” (CBN January 2010; Schaapman 2010). By contrast, Sandd’s CEO Gert-Jan

Morsink said to be “extremely happy”, adding: “We too strive for 80 per cent in permanent service. Yet, the

deliverers themselves have to be willing and it has to be payable” (website Nu.nl 2009).

Meanwhile, tensions between management and unions at TNT had grown. In April 2009, a 68 per cent

majority of union members consulted voted against a basic CLA accord with TNT, including a 15 per cent

wage cut in exchange for certain employment guarantees. Union offi cers defended this accord, but could

not convince their constituency, of which many seemed tired from all reorganisations that had already piled

up at TNT (NRC-Handelsblad 2009a). Even if this wage cut had been accepted, according to management

plans employment at the Post division should be reduced by about 7,000, though likely forced dismissals

17 Remarkably, and in contrast with the announcement in the accompanying press sheet, not the Minister of Minister of Social Affairs and Employment, Jan-Hein Donner.

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could be avoided. Yet, TNT’s top management replied that under the new conditions they were forced to

work out plans for the shedding of about 11,000 jobs (of 23,000), of which 4,000 to 5,000 through forced

dismissals. From 2009 on, TNT announced, they were only willing to hire new workers on a part-time ba-

sis. These messages caused quite some upheaval in the Netherlands, also outside the circle of the directly

involved.18 In September 2009, Post director Koorstra specifi ed the job of the new post deliverer. He or

she was to be a part-timer, working on average about 12 hours weekly. Unlike the post(wo)man, normally

starting the shift with fi nal post sorting for his or her area of service, the deliverer would get a ready-made

post package: there would be a strict divide between sorting and delivery. According to HR manager Gerard

Aben, the amount of part-time post deliverers at TNT Post would increase from 13,000 in September 2009

to 35,000 in the years to come (Van der Heide 2009; confi rmed in TNT Annual report 2010: 205).

The three public sector unions, AbvaKabo FNV, BVPP and CNV Publieke Zaak, decided to take refuge

to independent studies. They asked SEO Research to relate the plans of TNT management to scenarios for

market development, and Ecorys Research to investigate whether there were alternatives for forced lay-offs

at TNT Post without deterioration of wages and conditions. The Ecorys report concluded that it would

not be possible to solve the problems at TNT without forced dismissals and savings on labour costs of the

incumbent staff -- although the latter savings could be lower than TNT had indicated to its shareholders as

to keep up sound business (website Ecorys; Van der Lijn et al 2009). In the short run, the outcome of the

SEO report, also published in October, did not imply support for the unions. The SEO report warned for

a price war, that would most likely lead to bankruptcy of the new entrants and a renewed monopoly situa-

tion. The SEO researchers recommended that the government for the postal market would strengthen the

anti-trust authority and introduce ex-ante anti-trust controls instead of purely ex-post controls (Baarsma and

Weda 2009).

In a press conference on 26 October 2010 where these reports were presented, the fi ve unions involved

concluded that at TNT wage cuts to a certain level were inevitable, though emphasizing the outcome of the

Ecorys report that these cuts could be less deep than suggested by management. The unions announced

to organise a referendum: accept the zero line in terms of wages and retain employment, or to focus on

achieving a pay increase, subject to potential job losses but provided that a sound redundancy plan could

be drafted (Schaapman 2010). A few days earlier, TNT management had urged the unions to speed up

18 Various moves of TNT management were instrumental in bringing relations with the unions to a low. TNT questioned the outcome of the unions’ voting procedure ending up in 68 percent ‘no’s’, and announced an own staff survey as to trace opin-ions regarding the CLA -- in the Netherlands a rather unprecedented action. In December 2009, the TNT Board fi rst wanted to consult the union chairpersons before starting wage negotiations, also an uncommon move (NRC-Handelsblad 2009b, 2009c).

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their decision-making. TNT’s HR manager argued: “From 2007 on, the post volume at TNT Post has been

reduced by 8 per cent, while the cumulative decrease in volume since 2000 has been lifted to 25 per cent”.

However, he left in the dark how many jobs less than 11,000 would be shed if PTT staff agreed to accept

lower wages (Van der Heide and Veldhuis 2009a).

By 28 October, AbvaKabo FNV, BVPP and CNV Publieke Zaak sent a letter to TNT Post director

Koorstra, summing up about a number of urgent complaints on shop-fl oor conditions, including non-

payment of hours worked, manipulation of sickness leave, and intimidation of postal workers by higher

ranked. Journalistic reports also depicted frustration and growing job insecurity at the shop-fl oor. It was

found that TNT Post, mostly through its subsidiary TNT Post Pakketservice, outsourced substantial amounts

of parcel deliveries to rather mouldy but clearly low-paid fi rms and persons.19 In this atmosphere, the letter

that TNT Post sent by 7 November to all 23,000 post(wo)men employed got a quite negative reception. In

this letter, it proposed a wage cut of 35 per cent; if accepted, only 1,000 jobs would be subject to forced

dismissal, though at any case 11,000 jobs had to be shed by 2015. The unions refused this proposal (Van der

Heide and Veldhuis 2009b; NRC-Handelsblad 2009c).

3.5. 2010

In 2010, the unions had to deal with negotiations on two fronts, with TNT Post and with Sandd, Se-

lektMail and Netwerk VSP (that had joined in an employers’ association, Werkgeversvereniging Postverspreiders

Nederland, WPN). We start here with the latter front. The unions argued that the new entrants had used

the fact that they won the lawsuit of December 2009 as a licence to virtually stop offering regular labour

contracts to their workforce. A fi rst evaluation in March 2010 of the conditions for the contract scheme

found out that by April 1, only 3.2 per cent of post deliverers had accepted a labour contract, as against the

14 per cent obligation laid down in the CLA. As a consequence, by June 2010 AbvaKabo FNV, BVPP and

CNV Publieke Zaak terminated the CLA, which implied that the. Governmental Decree went into effect

(In mid-April a higher court had nullifi ed the earlier verdict of the The Hague court in the legal case Sandd/

SelectMail vs the state (Klok 2010)). On the other hand, the evaluation in March 2010 concluded that both

market volumes and tariffs were considerably lower than expected, a development that seriously hampered

realisation of the scheme target (Baarsma and Van Wijnbergen 2011: 4-5).

19 Confi rmed in TNT Annual Report 2010 (39), stating that in 2010 85 per cent of parcels were delivered by subcontractors.

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In September, negotiations over a new CLA failed defi nitely. In the negotiations, the union delegation

had offered WPN an extra year to reach the 80 per cent target of the scheme, but the employers refused

that offer. AbvaKabo negotiator, Peter Wiechmann, commented: “That CLA was already the worst in the

Netherlands. If employers are not willing to accept a CLA at the absolute minimum level, there is no place

for them in the Dutch labour market (.....) We now leave it to The Hague (the government, MvK) to guaran-

tee that the industry fulfi ls its social obligations.” In turn, WPN secretary, Ron Follon, called the 80 per cent

scheme target “unrealistic under the current conditions”, and announced another legal case as to allow the

WPN employers to continue to pay piece rates (Van der Heide 2010). Earlier, the unions had accused Sandd

and SelektMail to “do everything” as to discourage post deliverers to accept labour contracts (Volkskrant

2010).

In February 2010, TNT and the unions agreed in principle on a new two-year CLA. It mapped out a

pay increase of 0.7 per cent. In exchange for the pay rise, the trade unions conceded to the potential loss

of about 4,000 postal delivery jobs at TNT Post. The redundancy plan linked to the agreement contained

a voluntary exit scheme for delivery workers. If they volunteered for alternative job placement counselling,

they could receive up to 30 months’ salary (Schaapman 2010). Only three months later, TNT seemed to

have decided to a major shake-out. It announced that all 15,000 postal workers working over 25 hours a

week would face dismissal and that 11,000 jobs would most likely be shed. The unions were shocked. A

spokesperson of the AbvaKabo FNV union said, “We had expected this to affect 11,000 postal workers in

total and that between 4,000 and 5,000 would lose their jobs.” Inge Bakker, negotiator of CNV Publieke

Zaak, a union known for its overall moderate viewpoints, reacted: “If our members ask us to strike, we will

of course think about doing that.” While unions placed their hopes on the planned parliamentary debate

about wages and conditions at TNT, Ms Bakker acknowledged that there were very few options left (CBN

June 2010). TNT refused seriously studying options that could have brought down the decrease in Dutch

jobs, like mitigating the speed of automation in post sorting and/or continuing the link between sorting and

delivery. Instead, it opted for fully offshoring its process of video-coding (see earlier ‘Intermezzo’).

After Summer holidays, in negotiations between TNT Post and the unions concerning the shaping of

the reorganisation it turned out that TNT management earlier in 2010 to a considerable extent had talked

big. The unions succeeded to decrease the number of those under forced dismissal from 4,500 to 3,100.

Yet, at the same time union offi cers got quite some signals from their constituency that the speed of re-

structuring and slimming down was too high, with the workload in the TNT distribution centres growing to

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unacceptable levels. The new effi ciency regime in these centres was said to spoil shop-fl oor relations to the

bone, and indeed resulted in a number of wildcat strikes. Over 1,000 union members attended a protest rally

organised by the three unions, AbvaKabo FNV, CNV Publieke Zaak and BVPP (NRC-Handelsblad 2010).

In October, the three unions confronted TNT with an ultimatum demanding to diminish the number

of forced dismissals to under 3,100; if not, a 24-hours’ strike would be held in the second week of No-

vember (CBN October 2010). As TNT Post reacted negatively, AbvaKabo FNV and CNV Publieke Zaak

called a 24-hour strike on 16 November, followed by a 48-hour strike on 25 and 26 November. In these

three days the country had to do without regular postal delivery (CBN November 2010). In the night of 15

to 16 December, the unions reached a basic accord with TNT Post. The fact that 11,000 jobs at TNT Post

would be shed, remained, but in this accord the number of forced dismissals was reduced from 4,500 to

2,300.20 In the fi nal negotiations, TNT Post gave up its earlier condition of (further) wage moderation, and

that opened the way for an agreement. The unions were only moderately positive about this result as they

remained worried about how reorganisations within TNT would be shaped and how these were to affect

shop-fl oor conditions, which they said were still deteriorating and needed close monitoring (CBN Decem-

ber 2010). The membership of AbvaKabo FNV fi nally endorsed the deal; 57 per cent of the vote was in

favour. Union negotiator Wiechmann commented to have expected no more than this small majority, also

because of the job insecurity and high work pressure at the TNT shop-fl oor, notably in the distribution

centres (CBN January 2011).

In mid-December 2010, a parliamentary debate on post liberalisation led to temporary relief for the

new entrants. This debate seemed urgent, as in the absence of a CLA and with the Governmental Decree

in effect, Sandd and SelektMail should have 100 per cent labour contracts by 1 January 2011, and that might

have meant that they would have to leave the postal letter market. The House of Representatives agreed

with the request of the newly-appointed State Secretary of Economic Affairs, Henk Bleker (CDA), to grant

them some delay, and the labour contract scheme laid down by government was temporarily postponed.

Yet, a majority of the House wanted to be in possession of the report of Ruud Vreeman21, in November

asked by the cabinet to act as a ‘scout’ and to assess possibilities to break through the deadlock, by 15 Janu-

ary 2011 latest, as well as a cabinet viewpoint on the development of the postal market (Letter Minister of

EconomicAffairs to chair House of Representatives, 11 January 2011).

20 Baarsma and Van Wijnbergen (2011: 8) mention 2,800, but that must be an error.21 Former FNV transport union leader, chair of the Labour Party, MP for that party, and mayor of Zaanstad and Tilburg.

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3.6. 2011

On 11 January 2011, Vreeman’s advice was published. Crucial in his view was the introduction of a

Labour Contract Fund, that would enable reaching 80 per cent labour contracts at the new entrants by

December 2012 or December 2013. Vreeman also proposed suspension of the start of the Governmental

Decree until 1 April 2011, as to allow social partners time for bargaining a new CLA. The cabinet agreed

with the latter proposal, and asked SEO Research to assess the proposed Labour Contract Fund. SEO

researchers Baarsma and Van Wijnbergen (2011) judged that the fund construction would encounter quite

some fi nancial and legal problems, but that a way out might be the introduction of a general excise-duty in

the B2X segment (grouped packages). A parliamentary majority turned down the latter idea as not realistic.

Debates in the House of Representatives on the post market continued over the year. This was eased by the

fact that, although in 2011 volumes continued to decrease (see Table 1A), tariffs stabilised and even grew

somewhat (Cf. TNT Post Annual Report 2011).

On 3 April 2011, the fi ve unions involved and the WPN employers’ association agreed upon a basic

agreement for deliverers (postverspreiders), laying down that post deliverers would at least earn the SMW;

should not be obliged to work at substantial distances from their place of residence, and allowing companies

time until the end of 2013 to reach the 80 per cent scheme target. The exact date of this last regulation re-

mained subject of negotiation. On 15 September a defi nite CLA was signed, basically with some content as

the earlier one but in which 30 September 2013 was stipulated as the ultimate date to reach the 80 per cent

target (sources: website FNV Bondgenoten; website Flexnieuws). Nearly parallel with these negotiations,

the three unions bargained with PostNL a one-year CLA for their deliverers (postbezorgers). AbvaKabo FNV

and CNV Publieke Zaak were very disappointed about the fi nal offer of PostNL as of November 2011. In

that offer, the lowest wage scale was equal to the SMW, the next steps were respectively 2 per cent (after one

year of tenure) and 4 per cent (after three years of tenure) above the SMW. As PostNL left out any promise

to this effect, these unions expected that with the next increase of the national SMW, those in the lowest

scale would fall below that minimum. Both unions advised their membership not to accept the accord, but

the BVPP union reacted positively, which under the CLA Act of 1937 was suffi cient to have a CLA pending

(website AbvaKabo FNV).

On 29 March 2011 the government had already issued a Governmental Decree, as earlier laying down

the obligation to have 80 per cent of post deliverers under a labour contract as by 1 January 2014, except for

those postal fi rms agreeing upon a CLA along the CLA Act. This Decree was put on ice, until in November

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2011 social partners did agree on the CLA; then, it was made operational by 1 February 2012 and put into

law by 1 January 2013. The explanatory memorandum stated that this Act, in accordance with what a parlia-

mentary majority had requested, should be regarded as a means of support for the CLA parties (Staatsblad

2011).

3.7. 2012-2013

In 2012, the cabinet embarked upon a program to adapt existing legislation to the newly developing con-

ditions in the postal market. In the short run, this meant adapting articles 8 and 89 of the Postal Act 2009.

Again in accordance with a majority vote in the House of Representatives, the demand that post deliverers

should have a labour contract (an element missing in the 2009 Act) was now introduced explicitly. The new

art. 8 reads: “A postal company should have a labour agreement with a minimal percentage of post delivery

workers, to be laid down in a Governmental Decree. By governmental decree the date will be specifi ed when

this minimum percentage should be attained. Application of this rule can be limited to certain categories

of postal companies or certain conditions”. The new art. 89 opens the possibility to end this obligation

if that is no longer needed (Act of 1 November 2012). The governmental reorientation then focused on

the Universal Postal Service (UPD). In June 2013, the Minister of Economic Affairs lightened a number

of demands on PostNL, as to keep it possible to act in line with the UPS, against the backdrop of rapidly

declining volumes. Among other things, PostNL was allowed to bring down the number of letter boxes

from about 20,000 to 8,700, and to diminish the number of ‘post offi ces’ from 2,400 to 1,000 (Minister of

Economic Affairs 2013).

In February 2013, bargaining with PostNL on the new 2013 CLA for deliverers (postbezorgers) started.

This time PostNL avoided a debate on the lowest wage scale level, and said to be willing to keep that equal

to the SMW; the unions demanded a 2.5 per cent wage increase and a number of improvements in second-

ary conditions. The basic accord as of 11 April contained a wage hike of 0.6 per cent for wage scales 1 and

2 per 1 July, on top of the SMW increase. A substantial majority of the union membership voted in favour

of the accord (website AbvaKabo FNV).

Developments at Post NL were manifold in 2012-2013. Although on the one hand it has broadly been

recognized that the market exit of SelektMail and Netwerk VSP addressed mail resulted in a normalisation

of the competitive landscape, on the other hand the pressure on PostNL to orderly reorganize continued

to be invariable high. Its internal organisation was still rather in turmoil, and the unions noted a massive

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amount of workers’ complaints though in the course of 2013 these seemed to diminish (AbvaKabo FNV

website). Many consumers were complaining as well, as for them the organisational problems resulted in

underperformance of the delivery service. In the PostNL 2012 Annual Report, CEO Herna Verhagen

acknowledged: “Severe quality issues while at the same time not realising the necessary effi ciency improve-

ments also meant we had to stop implementing part of our reorganisation in April 2012 (....) In the months

May through December we worked hard to restore quality, and identify alternative saving options. For-

tunately, by October quality was back up at levels exceeding 95 per cent next-day delivery, our minimum

quality requirement”. ACM, the new regulator, also noted that PostNL failed to meet its delivery targets in

2012; PostNL delivered only 93.6 per cent of its mail next day and thus missed its 95 per cent target. ACM

wrote Ms Verhagen to assume the situation will be improved in 2013 so that administrative fi nes will not be

required (website Post & Parcel 2013).

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4. Development of market shares

Tables 1A and 1B present an overview of the development of market shares in the postal market for

addressed mail items in the Netherlands, for 2000-2012. A variety of sources has been used to this effect.

Although a main other source (PostNL 2012b) showed slightly different fi gures, the general trend derived

from this source is similar to that depicted here. In particular in 2010 and in 2012 the decrease of volumes

at PostNL, including those of Netwerk VSP, was severe, with twice nine per cent. Yet, it should also be

registered that the volumes of Sandd/SelektMail reached their top in 2007, and from then remained a bit

lower. Nevertheless, related to the decrease at PostNL, their market share(s) increased.

Table 1A Development of market shares, postal market The Netherlands, 2000-2012 (x million addressed mail items and index 2005=100)

TNT Post / Post NL Sandd & SelektMail

TOTAL

UPD Other Post

Total TNT

x mln. index x mln. index x mln. index x mln. index x mln. index

2000 5,608 109.1 0 0 5,608 100.62001 3,480 101.6 2,096 123.4 5,576 108.5 0 0 5,576 100.02002 3,417 99.3 2,104 123.8 5,521 107.4 67 15.4 5,588 100.32003 3,381 98.3 2,003 117.9 5,384 104.8 138 31.7 5,522 99.12004 3,440 100.0 1,862 109.6 5,302 103.2 230 52.9 5,532 99.22005 3,440 100.0 1,699 100.0 5,139 100.0 435 100.0 5,574 100.02006 3,168 92.1 1,750 103.0 4,918 95.7 620 142.5 5,538 99.42007 3,068 89.2 1,633 96.1 4,701 91.5 700 160.9 5,401 96.82008 1,350**) 46.4 3,088 181.8 4,438 86.4 683 157.0 5,200 93.32009 1,175 40.4 3,086 181.6 4,261 82.9 635 146.0 4,896 87.82010 1,039 35.7 2,852 167.9 3,891 75.7 652 149.9 4,543 81.52011 1,004 34.5 2,773 163.2 3,777 73.5 658*) 151.3 4,435* 80.72012 3,437 66.8 655*) 150.6 4,092* 73.4

Sources: RebelGroup / SEO 2013, Tables 2 and 3; OPTA 2011 - Marktmonitor Post; Annual Reports PostNL, 2011, 2012*) estimate author based on various sources, incl. Annual Reports PostNL, 2011, 2012, concerning all competitors of TNT Post (PostNL)**) reconstructed volume UPD based on Postal Act 2009

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Table 1B Development of market shares, postal market The Netherlands, 2000-2012 (x million addressed mail items and division TNT Post / Sandd & SelektMail)

TNT Post Sandd & SelektMail

x mln. share x mln. share2000 5,608 100.0 0 0.02001 5,576 100.0 0 0.02002 5,521 98.8 67 1.22003 5,384 97.5 138 2.52004 5,302 95.8 230 4.22005 5,139 92.2 435 7.82006 4,918 88.8 620 11.22007 4,701 87.0 700 13.02008 4,438 86.9 683 13.12009 4,261 87.0 635 13.02010 3,891 85.7 652 14.32011 3,777 85.4*) 658*) 14.6*)2012 3,437 84.0*) 655*) 16.0*)

Sources: RebelGroup / SEO 2013, Tables 2 and 3; OPTA 2011 - Marktmonitor Post; Annual Reports PostNL, 2011, 2012*) estimate author based on various sources, incl. Annual Reports PostNL, 2011, 2012, concerning all competitors of TNT Post (PostNL)

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5. Development of employment

Table 2 presents an overview of the development of employment in the Netherlands for post(wo)men

(postbodes) and post deliverers (postbestellers/postverspreiders) over the last four years. These are own estimates,

based on as many sources as possible; yet, the uncertainty margins remain considerable, in particular regard-

ing the fi gures for the new entrants. However, the offi cial statistics of Statistics Netherlands (CBS) do not

allow to select both occupational categories jointly, let alone to divide between the two.

Table 2 Development of employment, postal market The Netherlands, headcount, 2009-2012

post(wo)men(postbodes)

post deliverers(postbestellers / postverspreiders)

TOTAL-GEN.

Year (medio)

TNT Post TNT Post Sandd & SelektMail

Netwerk VSP*)

TOTAL

2009 23,000 13,000 27,000 3,000 43,000 66,0002010 20,000 17,000 30,000 4,000 51,000 71,0002011 14,000 20,000 30,000 5,000 55,000 69,0002012 5,500 22,000 34,000 0 56,000 61,500

Sources: author’s estimates based on various sources*) only letter mail

Three reservations should be made here. First, from this Table it is nearly impossible to derive a picture

of the over-all development of employment in terms of FTEs. Yet, other sources do not allow to indicate

that development for the relevant occupations in the postal market either. Most likely, the ratio of FTEs per

headcount of post(wo)men at TNT Post is 0.8-0.9, whereas FTEs per headcount for post deliverers can be

estimated at 0.3-0.5 at TNT Post (delivering fi ve or six times a week), and at about 0.15-0.2 at the new en-

trants (that deliver only twice a week). Second, it is near-impossible to get an insight in fl uctuations over the

years or within a year. Comparison with Tables 1A and 1B suggests that notably for the new entrants the re-

lation FTE : headcount decreased between 2009 and 2011, and stabilized in 2012. For TNT Post / PostNL

the comparison between our fi gures suggests a strong rise in labour productivity in 2011-2012, most likely

linked with the tensions in its organisation indicated earlier. Third, quite a few post deliverers may work or

have worked for two or even more companies at the same time, as Internet fora for post deliverers (like

Postbezorgers.org) indicate. This practice may diminish the ‘real’ number of job holders as indicated in the

most right-hand column of Table 2 by 10 to 15 per cent.

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6. Development of pay and conditions

Pay and conditions for post deliverers at TNT Post/Post NL and the new entrants since 2007 con-

verged, meaning that basically they went heavily downward at the former state company and somewhat

upward at the newcomers. Concerning pay, recently in the CLA for Sandd etc. the hourly wage level of

the Statutory Minimum Wage was agreed for those with a labour contact (which with a year from now

should cover 80 per cent), whereas in 2007 for those (nearly all) at Sandd and SelektMail working under

an ‘OVO’ contract at piece rates it was virtually impossible to get at the SMW; based on the union docu-

mentation (notably FNV Bondgenoten 2007) one may estimate their hourly earnings at 60 to 70 per cent

of the minimum wage. By contrast, at TNT Post the post(wo)men, mostly full-timers with gross earnings

(depending on age and tenure) of 130 to 145 per cent of the SMW, have actually nearly fully been replaced

by part-time working deliverers, set at the SMW or at most four per cent above that. Nevertheless, their

current CLA offers a number of secondary benefi ts that those under the CLA WSP (Postverspreiders) do not

get. Table 3 compares both CLAs on a number of main items. The table shows that the CLA WSP lacks

some leave arrangements, maternity payment, educational facilities, collective accident insurance, and cost

compensations. Adult PostNL workers are included in the Company Pension Funds, whereas those under

the CLA WSP do not build up company or industry pension rights. Though at a minimal level obliged by

law, the CLA WSP does not refer to earnings during sickness. The only difference in favour of the latter

is higher overtime payment. Moreover, as the majority under the CLA WSP will now be employees, they

are entitled to general workers’ benefi ts, like unemployment benefi ts and basic social insurance benefi ts, to

which they were not entitled when having an ‘OVO’ contract. Finally, the past of PostNL as a state company

with strong union representation is refl ected in regulation concerning union activities, which is missing in

the CLA WSP. Overall, the latter CLA is ‘undressed’ and incomplete. compared with the standard CLAs in

nearly all Dutch industries, while concerning secondary benefi ts the PostNL is rather in line with those. On

the other hand, there very few CLAs in the Netherlands that equal wage scales with the SMW level22, with

no (WSP) or hardly any (PostNL) possibilities to regularly earn more hourly than that level. In that respect,

the effects of a ‘race to the bottom’ are clearly visible.

Working conditions and job content of post deliverers currently hardly differ between PostNL and the

new entrants, as they are related to the occupation as such. On Internet fora like Postbezorger.nl, deliverers

write about their employer preferences, but except for differences in CLAs these seem mainly subjective. 22 Based on FNV CAO Databank.

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As noted, additional tasks that were coupled with the post(wo)man occupation, like post sorting, have been

taken away.

Table 3 Comparison of selected items in CLAs TNT Post post deliverers / Sandd etc. post deliverers

Items CLA TNT Post post deliverers

(postbezorgers)01-01-2013/31-12-2013

CLA WSP (Sandd etc.)post deliverers

(postverspreiders)01-04-2011/31-12-2013

Status employee employeeWorking hoursMaximum daily hours / normal working week 9.5 (<18yr: 9) 40 hrsHoliday rights 4 x av. hours / week, united

3 weeks4 x av. hours / week, united

as wanted by employeeLeaveMarriage leave 4 days -Death of fi rst degree relatives 4 days -PayGrades 3 1Grade 0 SMW SMWGrade 1 (1 yr tenure) E 9.07 -Grade 2 (3 yr tenure) E 9.25 -Overtime > hours than contract: paid extra: 30%Holiday allowance 8% 8%Profi t-sharing yes -SicknessContinued earnings / 26 weeks 100% ?Payment during maternity leave / 26 weeks 100% -Company health service yes -PensionIn Company Pension Fund yes, <=21 yrs -OtherEducational facilities yes -Collective accident insurance yes, paid by employer -Compensation telephone costs yes, if needed for job -Compensation cycle (moped) costs yes, but ends 31-12-2013 -Union retribution yes -Union facilities yes -Union leave yes -

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Amsterdam Institute for Advanced labour Studies

Postal address: PO Box 94025 ● 1090 GA Amsterdam ● The Netherlands

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Tel +31 20 525 4199 ● Fax +31 20 525 4301

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Information about AIASAIAS is an institute for multidisciplinary research and teachhing at thhe University ofAmsterdam. Founded in 1998, it brings together the Universit brings together the U rsity’s exppertise in labour studies.

AIAS research focuses on the analysis of labour markets, social sees on the analysis of labour markets, social ysis of labour m security and nd governance. It combines various disciplinary approaches along threebines various disciplinary approaches along thus disciplinary approachciplinary app ree perspectives: ves:Societal regulations & coordination of markets, Individual transactions i & coordination of markets, Individual transacnation of markets, Individuon of markets, Indi ns in markets and Societal and individual effects. Some of our research programmes are:dual effects. Some of our research programmes ts. Some of our research progome of our research ● GINI Growinng Inequaliitiess’ Impacts● Solidarity in thhe 21st Cennturyyt

● Flex Work Reseearch Centntre● WageIndicator● Free Choice in Peensions

AIAS offers various in-company courses in the fi eld of HRM, inequality and solidarity,ompany courses in the fi eld of HRMlabour market development, labouabour relations etc.

Annually AIAS organizes conferences about ongoing research and current trends.Furthermore, several (lunch) seminars and workshops take place during the year, offering ginteresting opportunities for the exchange and deliberation of research on labour issuesues from all over the world. AIAS has a major collection of academic socio-economic dadata in the fi eld of labour relations, labour organizations, employment and working conondi-tions in the Netherlands and abroad. AIAS and its staff contribute to society on many y subjects,for different audiences and in varying formats (articles, books, reports, interviewws, prees-entations etc...). Next to this ‘Labour markets and industrial relations in the Nethherlandnds’ Series, we also have the Working Paper Series and the GINI Discussion Papers whwhich also addresses a great variety of topics.

The 'Labour markets and industrial relations in the NNetherlands'sPublication Series

The AIAS ‘Labour markets and industrial relations in the Neththerlands’ s’ series aims to publish reports prepared by AIAS staff concerning the Dutctch labour ur market and the in-dustrial relations in the country. See for all reports: www.uvava-aias.netet ► Publications ►NL Industrial Relations Series..