Yahoo Finance Benetton Group Negotiates With Trade Unions on Protecting Jobs Amid Restructuring
MILAN — The winds of restructuring are sweeping over Benetton Group.
With a new chief executive officer in place, Claudio Sforza, who succeeded Massimo Renon, Benetton Group is reportedly looking at implementing a wage support measure for its office workforce aimed at preserving jobs, finding the best deal with trade unions.
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As per Italian law, the measure, called “solidarity contract,” allows companies in restructuring mode to find an agreement with trade unions to reduce working hours and corresponding salaries with the goal to avoid job cuts.
Trade unions already met the company’s board and Sforza twice since he’s taken office on June 18. At the next gathering, planned for July 15, they will voice their disapproval for the terms of the measure submitted by Benetton Group, which is proposing a 40 percent reduction in working hours for about 1,000 office employees mainly based at its Ponzano, Italy, headquarters for the next six months.
“This measure is going to severely impact workers’ salaries. It’s a challenging request,” Massimo Messina, general secretary of the Filctem-Cgil union in Treviso, told WWD on Thursday.
Unions are pressuring Benetton Group to rethink the terms of the measure and trim the working hours’ reduction to 20 percent, and to potentially reintegrate an additional 10 percent, which would result in workers renouncing just 10 percent of their salaries.
According to sources close to the Italian fashion company, the 20 percent reduction is the most likely outcome of negotiations. “It is to be considered a measure geared at protecting the workforce,” one source said.
The measure was already implemented in 2022 for 756 Benetton Group employees out of 900.
“This is a first treatment to put the balance sheet on an even keel, but the real therapy comes with an industrial plan aimed at restructuring the company,” Messina opined.
In addition to wage support measures, Benetton Group is expected to incentivize voluntary retirement, the Filctem-Cgil general secretary offered. He recalled Sforza meeting the trade unions two days after he took on his new role and ensuring job cuts were not on his agenda.
“We are hoping to get answers to our requests…and be provided with an industrial plan, albeit not final,” Messina said.
This marks a new development in Benetton Group’s attempted relaunch, following an interview with the company’s cofounder Luciano Benetton in Italy’s daily Corriere della Sera last May. Aged 89, Benetton said he was exiting the company he cofounded and his role as president, and that he felt “betrayed” by his managers, without naming Renon. Benetton claimed they drove the company into the red and that he had only recently found out just how bad the situation was.
Renon was terminated soon thereafter, and Sforza named CEO, part of the new board, which includes chairman Christian Coco and Andrea Pezzangora.
In 2023, Benetton Group revenues amounted to 1.1 billion euros, with a net loss of 230 million euros, also due to a devaluation of 150 million euros. Losses before interest and taxes amounted to 113 million euros.
Net assets totaled 105 million euros.
Despite Luciano Benetton’s exit, controlling shareholder Edizione, a Benetton family holding, is said to plan to continue its support of the reorganization and relaunch plan of the fashion group, earmarking 260 million euros to this end over the next few years. Over the past three years, Edizione channeled 350 million euros into the Benetton Group activities.
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