Additional information
LABOR RELATIONS
Employees
Union relations and works councils
During 2005, we had an average number of 168,568 full
time employee equivalents compared to 231,003 in 2004
and 262,409 in 2003. The number of employees decreased
in 2005 compared to 2004 primarily because of our
divestment of BI-LO/Bruno's and our Spanish and South
American operations.
For information about the average number of persons
employed by us in 2005, see the table "Average number of
employees in full-time equivalents" in Note 5 to our
consolidated financial statements included in this annual
report.
As of January 1, 2006, approximately 94,000 employees
in our U.S. retail operating companies and approximately
5,000 employees in our U.S. Foodservice operating
companies were represented by unions. Collective labor
agreements covering approximately 11% of our total U.S.
retail employees will expire for the Stop Shop/Giant-
Landover Arena in the period of May 2006 until October
2006, for the Giant-Carlisle/Tops Arena the collective labor
agreements have expired in September 2005. Currently the
Giant-Carlisle/Tops Arena are continuing to honor the terms
of the expired collective labor agreements on a week-to-week
basis, as they are negotiating the terms for the replacement
of the collective labor agreements. Approximately 6% of our
total U.S. Foodservice employees are covered by collective
labor agreements that are scheduled to expire in the period
of January 2006 until September 2006.
During 2005 we renewed most of our relevant collective
labor agreements relating our Dutch operations. We were
able to manage this without being confronted with industrial
actions. Most of our Dutch collective labor agreements will
not expire before April 2007. Only the collective labor
agreement covering the majority of our Dutch distribution
employees, which will expire in April 2006, will have to be
renewed and we anticipate commencing the bargaining
process with the relevant trade unions in April 2006.
Also in our Dutch operations, we currently have works
councils at Ahold Nederland B.V. and all our operating
subsidiaries in the Netherlands. A works council is a
representative body of the employees of a Dutch enterprise
elected by the employees. The management board of any
company that runs an enterprise with a works council must
seek the advice of the works council before taking certain
decisions with respect to the enterprise, such as those
related to a major restructuring, or a change of control.
If the decision to be taken, in respect of these matters, is
not in line with the advice of the works council, the
implementation of the relevant decision must be suspended
for one month. The management board must also seek
advice for a proposal to appoint or dismiss a member of the
management board. During the one month suspension
period, the works council may file an appeal against the
decision with the Enterprise Chamber (Ondernemingskamer)
of the Court of Appeals in Amsterdam. Other decisions
directly involving employment matters that apply either to
all employees, or certain groups of employees, such as those
affecting associate compensation systems, or pension or
profit sharing plans, may only be taken with the works
council's approval. Absent such prior approval, the decision
may nonetheless be taken with the prior approval of the
Court (Rechtbank). As Ahold Nederland B.V. is subject to
the mitigated structure regime, a works council may
recommend a candidate for appointment to the supervisory
board and may also object to the appointment of a proposed
candidate to the supervisory board.
Although only a minority of our employees in the Czech
Republic are union members the relation with the Trade
Union are stable, all of our employees are covered by a
collective labor agreement. The collective labor agreement
will not expire before December 31, 2007. A very small
minority of our employees in Slovakia are union members.
We consider our labor relations to be satisfactory.
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