EWC SUEZ meets but lacks important information on merger project




The European Works Council of Suez met 23-26 October. It held a preparatory and a debriefing meeting. It met in plenary with Suez CEO Mr. Mestrallet. The main issue of the discussion concerned the proposed merger with French company Gas de France.

- The preparatory meeting was fully devoted to the merger. Representatives received a briefing from experts of Secafi, the French consultancy close to the unions 23 and 24 October. The EWC also discussed the consequences of the merger with trade union representatives of Distrigas and Fluxys.

- Mr. Mestrallet (Suez CEO) informed the EWC of the state of affairs, including the so-called Pax Electrica II in Belgium, discussions with the European Commission and the preparation of the merger. As part of the concessions Suez made to satisfy the European Commission and the Belgium government, Suez will release control over a number of activities in the gas sector such as over Fluxys (gas intrastrucure) and sell Distrigas. Buyers are queuing up the EWC was told.

- Workers in Distrigas and Fluxys participated in the preparatory meeting and a delegation participated in the plenary. The main concern was the future viability of the companies. The unions demanded social guarantees and received support from the EWC. Guarantees were provided in written form during the meeting. If the new company will dismiss workers within 18 months after the sell, Suez will take them back.

- The EWC will be invited to give an opinion on the proposed merger although it will not have a legal character. An extra-ordinary EWC will be called to this effect, probably 3 November. A General Shareholders meeting is foreseen for 22 December (Suez) and 28 December in Gas de France. These will give approval or not. Several shareholders are campaigning to demand more extra-ordinary dividends. Each euro additional dividend will cost the company around 1.25 billion Euros. This money is not the outcome of any productive process and will not be used for investment in the company. The Suez EWC is against this. It notes further that it would possibly increase the indebtness of the company. Mestrallet stated he stands fully behind the future of Suez Environment and Suez Energy services in the new company. It is clear when private equity funds buy Suez Environment and when financed by debt, this will impair the future of the environmental activities requiring rapid sell-offs. It will also prevent investments.

- The EWC requested that the workers would also see a positive outcome of the merger, and that a more generous attitude is needed in the negotiations;

- It is proposed that the new Board of the company will have three workers' representatives and 1 representative representing the workers-shareholders. The EWC believes that we should have a third of the seats as currently the case in Gas de France. The argument was also made that the non-French activities should be represented, The French state will have the right to appoint a number of representatives in the Board and corresponding with its shareholdership of 34,7%. The new company still intends to become an SE.

Other issues discussed:

- Health and Safety. Suez has a health and safety charter (negotiated with the EWC and unions) and a joint health and safety committee. An international day on health and safety is foreseen for 8 December, I will bring together health and safety representatives from all activities. The reason is that the EWC had the impression that the charter is not followed up in all companies of Suez. Also the number of mortal accidents is high especially in subcontracting and third parties.

- Equality and Diversity. The equality committee (EWC representatives and management) is meeting regularly to agree an equality position. After several meetings management has proposed a text but which does not take account of earlier work done. The EWC expressed its disappointment on this way. The equality committee proposed members to circulate a text on equality. (see Tract below).

- Life-Long Learning and Training. A project for a statement was presented by management. The EWC decided not to sign this Colombia The EWC questioned if Electrabel is using coal from an US company exploiting coal mines in Columbia. The US company Drummond is believed to be behind killing of three trade union officials. Electrabel will explore this but the first indication is that no such coal are used.








- Tract "Briefing to employees of the SUEZ group - Bipartite committee on equality and diversity