New Internationalist

Michelin Bounces Back

Issue 088

Third World governments aren’t the only ones being pushed around by multinational corporations. The Mari­time province of Nova Scotia, one of Canada’s have-not regions, recently got a taste of not-so-subtle arm twisting from the French tire-manufacturing giant Michelin.

In what appears to be a straight­forward case of corporate pressure tactics the province responded to rumours that Michelin would quit with legislation designed to ease the corpora­tion’s anxieties over the possible union­ization of one of its two Nova Scotia plants.

Bill 98, since dubbed the ‘Michelin Bill’, amends the provincial Trade Union Act to make it retroactively illegal for a union to organize only one factory if the company owns two or more in the same industry. This effectively scotched the United Rubber Workers (URW) efforts to unionize Michelin in Canada. The URW had already signed up 40 per cent of the workers at one Michelin plant, and so met the legal requirement to conduct a certification vote.

One important factor behind the bill was the fate of Michelin’s plans for a new 100-million plant. The decision to go ahead with the Nova Scotia venture was widely held to be dependent on the bill’s passage. As if to confirm what the Nova Scotia Federation of Labour labelled corporate extortion , the invest­ment was officially announced only one day after the ‘Michelin Bill’ was introduced in the legislature.

The United Rubber Workers will now have to sign up 40 per cent of the workers at the two existing Michelin factories within the three month period stipulated by law in order to hold a new certification vote. Given the French multinational’s record in discouraging unions, that’s liable to prove difficult. In 1979 Nova Scotia’s Labour Board found the company guilty of infringe­ments of the labour code in trying to counter the union organization cam­paign. Michelin denied workers the right to sign a union card at any time on company property, held compulsory anti-union meetings for employees and sent letters to workers’ homes warning against the dangers of unionization.

The ‘Michelin Bill’ is only the latest concession the company has been able to win from a compliant government. Michelin was originally attracted to Nova Scotia by $80-million in low­interest loans and a grant of $7.6-million. The federal government in Ottawa sweetened the pot by tossing in another $21.9 million.

In the short term the government’s cap-in-hand approach has paid off - another 1, 800 jobs may result from the new plant. But the province’s embarass­ing willingness to restrict the right to organize in order to appease Michelin is a disturbing precedent. Investment ‘incentives’ to corporations (tax write­offs, grants, and low interest loans) are evidence enough of government’s dependency on the job-creating power of multinationals. But the Nova Scotia decision signals a new and dangerous affront to trade union rights in the West. Parallels can be easily drawn from the Third World with the Philippines, Malaysia, South Korea, Argentina, Chile. In order to attract multinational dollars those countries and many others like them pursue policies bent on keeping wages low and making unionization impossible or illegal.

The parallels are disturbing. As competition for jobs mounts in the West during the present recession the example of Nova Scotia may set a new trend in ‘incentives’ to corporate investors.

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