behind the picket lines: a nudge to better incorporate good governance
By: Lotte Booij
In 2023, the Netherlands experienced an unprecedented surge in labor strikes, with 52 recorded incidents—the highest in over five decades. These strikes, spanning multiple sectors, were driven by shared frustrations over wages and inflation (1,2). In 2024, this trend continued, with significant actions such as the first nationwide strike by pharmacy assistants (3) and a major strike by ProRail workers (4). These actions reflect ongoing discontent, fueled by stagnant wages, deteriorating working conditions, and a sense of being undervalued, compounded by financial pressures from the pandemic and rising inflation (2, 5). The shift from local to nationwide strikes underscores how unresolved grievances intensify over time. Unless negotiations occur and employers take workers’ concerns seriously, industrial actions are likely to increase (3,4).
But what does this tell us about the state of labor relations in the country? How can these strikes lead to better governance, and what does this mean for the future of work and the relationship between employers and employees?
the roots of discontent
A major driver of recent strikes in the Netherlands is the soaring cost of living, which has prompted workers to demand wage increases to maintain their standard of living. In 2023, 28 strikes in the industrial sector involved 5,000 workers and caused 142,000 lost workdays, driven by frustration over stagnant wages and collective labor agreements (6). We still see this happening in 2024. Pharmacy workers, for instance, began phased strikes in September 2024, escalating to a nationwide strike. They highlight the disparity between their wages and their responsibilities, noting that their salaries barely exceed those of supermarket employees. With starting salaries slightly above €2,300 and burdensome administrative tasks reducing patient care, they demand a 6% pay raise and a minimum hourly wage of €16. Employers, however, have only offered a 2% increase—far below the inflation rate, compounding workers’ frustration and sense of undervaluation (7,8). Public sector workers, including healthcare and municipal staff, have also resorted to strikes over heavy workloads and unresolved issues (9).
Similarly, Volkswagen employees are protesting a proposed 10% pay cut and job losses, demanding fair compensation and job security. These disputes reveal a growing disconnect between workers and employers, with employees feeling ignored and undervalued. The unions’ call for a 7% wage increase contrasts sharply with the company's proposed drastic cuts (10,11,12).
While the reasons vary, a shared sense of being undervalued and unheard unites these strikes (7,8,10,11,12). If no meaningful changes are made to address employees' concerns, the trend of escalating strikes is likely to continue, potentially leading to more frequent, intense, and prolonged industrial actions. This could deepen tensions between employees and employers, eroding morale and productivity, and further exacerbating inflationary pressures. Social unrest may also grow, with mounting pressure on the government to intervene (1,5).
through the lens of good governance
Strikes often arise from poor governance, as employers fail to engage workers in a transparent and inclusive way (13,14). This leads to employees feeling undervalued, as seen in the pharmacy sector and Volkswagen. To address this, companies can adopt proactive measures, such as early feedback systems and participatory decision-making, to avoid further conflicts. By fostering a culture of open communication, empathy and understanding, companies can reduce the need for strikes and improve labor relations (13,14)
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Measures that prioritize early feedback and effective dispute resolution play an essential role. Digital platforms can help streamline grievance tracking, ensuring that employee concerns are registered and addressed promptly. Open communication and participatory decision-making can preempt conflicts by fostering a culture of mutual understanding and respect. Employers who practice empathy and demonstrate a commitment to fair practices are less likely to encounter widespread disruptions (14,15).
toward a balanced future
Strikes, while disruptive to business and society, serve as a powerful call for fairness and equity, reminding employers of the value workers bring to industries and the importance of ensuring equitable compensation and respectful treatment. By addressing systemic corporate governance issues like communication, companies have the opportunity to create more sustainable and equitable workplaces. Strikes are a clear cry for help, leading companies to clearly see underlying issues and thus, paving the way for a future where companies and employees collaborate to build a fairer economy. Through good governance and fostering trust, employers can cultivate a culture where employees feel valued and respected, ultimately minimizing the need for strikes altogether. Shall we?
This article is part of The Outside World Formula created by ftrprf
For organizations, it’s pivotal to thoroughly understand what is happening in society. We help companies generate comprehensive insights into societal change and its potential effects on their strategy and operations, both negative and positive. With actionable societal insights, courageous plans, and a can-do mentality, we connect the outside world to your company's strategy. For these outside-world insights, we use a rigorous methodology that includes data processing, quantitative and qualitative analysis, and a thorough review process to ensure the accuracy and consistency of our findings. This article was written based on our monitoring of the theme ‘corporate governance’.
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