Major Conflict situation in Mondelez LTD Pakistan (InterOrganizational Conflict)

Mondelez Pakistan workers threatened, harassed and punished for

demanding the right to work for Mondelez!

Mondelez, the "global snacks powerhouse" carved out of the former Kraft Foods one
year ago, is celebrating its first anniversary "with month-long festivities and
volunteer activities for its 110,000 employees around the world" who are "taking
time to give back to their communities". In Pakistan, however, management
continues to threaten, penalize and harass the workers who make the company's
products for demanding the right to work for Mondelez. In Pakistan 53 permanent
workers but over 350 contract workers, many of them in 'core' production positions,
manufacture Cadbury-branded products for the company. Management calls these
workers "outsiders" and rejects the union's demand for negotiations on their
employment status. Many of these workers have long records of continuous
employment at the factory, but are denied their mandatory pension and social
security benefits. Agency workers are pressured to perform enormous overtime
under threat of losing their jobs.While Mondelez babbles about "sustainability",
these workers live in permanent insecurity.
Management has stated that the casuals will never be made permanent and has
threatened to close the factory. Dismissal proceedings have been initiated against
active union members, others have received warning letters.
On September 13 the Mondelez union and the national food workers' federation
launched a national protest campaign in support of their demands, beginning with a
demonstration at the company's head office in Karachi and alternating with protest
actions at the factory and in cities across the country.
How the conflict was resolved
A negotiated settlement between Mondelez and the IUF has resolved the long,
difficult conflict over the rights of precarious workers at the
The negotiations took place under the auspices of the UK's National Contact Point
responsible for the application of the OECD Guidelines for Multinational Enterprises.
The IUF made a submission to the OECD in March this year as part of a campaign
which generated strong international support for the workers and their struggle.

The company works with only 53 directly-employed Mondelez workers and many
hundreds of disposable jobs for casual workers supplied by labour contractors on a
"No work, no pay" system became a powerful symbol of the denial of fundamental
trade union rights through massive casualization. Precarious workers at company
were legally excluded from joining a union of Mondelez workers and participating in
a collective bargaining relationship with Mondelez as their real employer.
Under the terms of the settlement, Mondelez has agreed to create 200 additional
direct, permanent jobs, retroactive to October 15, 2015, with job selection to be
based on seniority and priority given to the members of the workers' Action
Committee, which led the struggle locally with the support of the IUF-affiliated
National Federation of Food, Beverage Workers. The selection and employment
process will be jointly monitored and implemented by the IUF and Mondelez at
national level.
Because the labour hire agencies in many cases systematically failed to fulfil their
mandatory financial obligations to the workers they employed as well as their
statutory obligations to the state social security and retirement funds, the
settlement involves both direct lump sum payments by Mondelez to the contract
agency workers (both those who do receive permanent positions and those who do
not) as well as guarantees from Mondelez that the arrears in contractors' mandatory
obligations to the state will be fully met.
Other Conflict in the organization:
Inter Personal Conflicts:
The reason for an interpersonal conflict mentioned by one of the employee
and team lead of the company was the "Selection Biases", the employee said
that selection biases may also lead to conflicts within the company, and
these conflicts are normally personal as well. The employee said that if in
cases the top management (directors) interferes in the process of hiring the
employees, they might select the wrong person for the right job who is less
capable of working in a highly competitive environment and doesnt go well
with the mentality of the team
The manager of Mondelez also raised the point of communication's problem.
They believe that every information must be communicated from their tables.
If in any case any employee bypasses the manager, there may be a conflict
between them. Manager also said that there is no need of any employee who
bypasses the manager to access to the top management (directors). Usually
the organizations do have "Coordinators" who are directly answerable to the
top management. He said that the manager will not be able to properly deal
with him and conflicts between them will arise.

Solution for resolving the conflict:

"The Organizational Conflicts" is itself a big problem, and it is a serious symptom of
some factors that are usually ignored while designing the organizational structures,
although mondelez fixed this problem but they should properly design their
organizational structure to avoid further conflicts with the labor union.
Directors were strongly in favor of "Coordinator", they said that a coordinator
channels the communication process between the manager and the top
management. Disagreement with the supervisor should be encouraged as long as it
leads to productive results and it should be communicated through a proper
channel,
All problems can be prevented from happening and/or rectified, if the middle
management (Manager) of the company justifies its position. Middle management
plays an anchor role. Manager should be able to deal with all the employees who
have different cultural backgrounds, personalities & priorities.
The current thinking should be for the maximum utilization of the company's
resources and to push the power and decision making authority down the hierarchy
of the organization. This can create more power and flexibility within the company
as whole. Good leaders should not have any problem in delegating power and
responsibility.