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In: Archive Golden World Awards

2007 Crisis Management - Maintaining Reputation during messy Employee Transfer

In this case, Indo Pacific Edelman was asked to resolve a messy dispute between the management of Securicor Indonesia and 268 ex-workers who were deemed to have resigned due to absence without leave. This issue had been going on for a year when we came in, was a hot topic in the media, and coverage mentioning Securicor were all negative. Despite what was a tough start, we managed to neutralize publicity within three weeks, and helped the company resolved its 14-month dispute with ex-employees in less than 2 months after being appointed.

Problems

In 2005, two global security companies, Securicor and Group4Falck, merged. In Indonesia, it was decided Securicor Indonesia (SI) and Group4Falck Indonesia (G4FI) would remain separate, with G4FI focusing on guarding and SI cash services.

Consequently, all SI guards were offered a transfer to G4FI without losing any entitlements. Majority of SI’s guards (1500 people) took this.

However, 268 guards demanded to be dismissed, paid five times their entitled severance, then re-employed by G4FI. This demand was frivolous, and therefore declined. Shortly thereafter, this group went on strike and protested in front of the SI’s premises. Because their strike was illegal (without notification to the police), the workers were considered absent without leave. By law, workers are deemed to have resigned after five consecutive days of no show, without obligation for severance pay.

During the strikes, each employee was given three warning letters to return to work, but only 19 did so within the five-day time frame. The rest were then deemed to have resigned.

This led the workers to campaign that they were unjustly terminated without compensation. They also filed a court case for reinstatement. They used human angles such as not being able to pay their children’s school fees, or rent, to get media and international advocacy group’s attention. They also approached SI’s clients to cancel contracts, saying the company violated their basic rights as human beings.

During this period, SI and global headquarters were not prepared with messages to respond to media and client queries, and the coverage was all negative. Indo Pacific Edelman was asked in June 2006 to maintain the company’s reputation and resolve the issue.

Research

1.Meetings with company executives to understand the case chronology and legal standpoint

2.Conversation with protestors (covertly), to see if they were still militant about reinstatement, or about the five-time severance. We also tried to find out how they gained high media attention when each protest was attended by about 20-40 people. From the conversations, we identified that they had a tent outside SI’s premises with fax machine, computer and printer so they could send updated press releases. We also identified that they were not interested in being reinstated although publicly, they demanded it. Their intention was to push the company to pay large amount of compensation

3.Thorough look at the settlement package the company offered (between 3-9 month salary depending on service years) versus the amount workers should be getting under the law (which amounts to nothing)

Planning

a.Communication objectives

1.Neutralize adverse publicity and kill news value so ex-employees no longer saw the benefit of continuing to use the media to get their point across

2.Convince employees and customers that Securicor is in control of the situation, and that the business was not impacted

3.To settle the case before another acquisition took place in 3-6 months

b.Success measurement

1.Tone of coverage, which should include the story from Securicor

2.The media should lose interest in covering the story even though the ex-employees continued to fuel them with humanitarian angles and dramatic photo opportunities

3.Ex-employees’ agreement to settle

4.Securicor should not lose clients because of this issue, although they continue to receive letters and boycott pleas from ex-employees

c.Public / desired actions

Ex-employees: to agree to settle at negotiated payout

Employees: to have them understand and support the company’s standpoint

Media: to make them understand that the issue is about disciplinary action, not non-compliance from a multinational company, and to have them stop covering the issue

Clients: to have them maintain trust towards Securicor

d.Messages

1.CONCERN - When Securicor and Group 4 Falck globally merged in early 2005 to form Group 4 Securicor (G4S), we understood that the job market in Indonesia was tough and for this reason intended not to dismiss any employees, instead offering every guard a transfer to G4FI without losing any entitlements

2.DISCIPLINARY ACTION - Due to the gap between what we offered and what a group of ex-employees demanded, we commenced a series of industrial dispute resolution processes. However, this group conducted an illegal strike for more than five days. This left us with no option but to take a disciplinary action for absence without leave

3.NO IMPACT - This issue does not affect our services to clients because the protest is conducted by a small group of ex-employees, not current employees.

e.Communication channels/vehicles

1.One-on-one meetings with non-radical ex-employee to explain the pluses of agreeing to settle

2.Local and international media, focusing only on those who have known or covered this issue before to prevent wider news coverage

3.Direct e-mail and letters to customers

f.Client consultation

1.Question-answer and speech rehearsals with spokespersons prior to any engagement or meeting

2.Daily update meeting during the most critical period

Execution

a.Implementation

1.Indo Pacific Edelman activities

a.Messages for local and regional management

b.Update letters to SI clients

c.Scripts for customer service / marketing staff telephone calls to clients

d.FAQ documents for SI’s customer services and marketing staff

e.Q&A document for media questions

f.Arrange media briefings with local and international media to explain the case

g.Take Securicor Indonesia director to visit key publications that heavily covered this issue to explain the case and neutralize their opinions

h.Monitor media coverage, client responses, and feedback from the protesting ex-employees

i.Regularly update standby media statement and case chronology

2.Securicor activities:

a.Use the key messages to:

b.Approach ex-employees on one-on-one basis to explain the pluses of settling down, and that legally they were not entitled to anything.

c.Clarify questions from the customers, as well as counseling them on how to respond to ex-employees’ pleas

d.Explain the progress of the situation to current employees

Evaluation

Tangible result:

· All negative coverage stopped within two weeks

· International media, Dow Jones and The Guardian, cancelled their plans to write a story about the messy industrial case, knowing that this is not an issue of non-compliance from a multinational company, rather employees that were sanctioned for absence without leave

· A series of media briefings with local business and investigative media (including two TV stations) resulted in either no coverage or neutral articles

· All articles that came out after we were appointed included at least one of SI’s key messages

· SI did not lose a single client because of this issue

· All SI sales and customer service staff were able to calm clients that questioned letters and accusations from the ex-employees

· In August 2006, the Supreme Court ruled that the ex-workers should be reinstated. However, they chose to receive a negotiated payout. A 14-month battle between management and ex-workers was resolved less than two months after we were appointed.

Learning from this case, SI engaged us to prepare messages and communication kits prior to announcing another acquisition in late 2006. This acquisition was a success with no media coverage and all employees of the acquired company agreeing to transfer without any issues.

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