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Dominance Effects from Local Competitors: Setting Institutional Parameters for Employment Relations in Multinational Subsidiaries; a Case from the Spanish Supermarket Sector

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  • Tony Royle
  • Luis Ortiz

Abstract

Dominance effects are normally associated with multinational corporations (MNCs). However, we argue that a strong local competitor can create ‘dominance effects’ setting the institutional parameters for employment relations in multinational subsidiaries. Moreover such an effect can be persistent. In this case the Spanish‐owned El Corte Inglés (ECI) used its power and influence to establish an employer's federation and two ‘yellow unions’. These yellow unions infiltrated the French‐owned MNC Carrefour and most of the Spanish supermarket sector by the early 1980s and continue to dominate collective bargaining rounds and works council elections, marginalizing the main independent trade unions. This has resulted in poor pay and working conditions and a lack of effective employee representation across most of the Spanish supermarket sector. The fact that Carrefour established an international framework agreement to observe union rights in 2001 has as yet not changed this situation.

Suggested Citation

  • Tony Royle & Luis Ortiz, 2009. "Dominance Effects from Local Competitors: Setting Institutional Parameters for Employment Relations in Multinational Subsidiaries; a Case from the Spanish Supermarket Sector," British Journal of Industrial Relations, London School of Economics, vol. 47(4), pages 653-675, December.
    • Handle: RePEc:bla:brjirl:v:47:y:2009:i:4:p:653-675
    DOI: 10.1111/j.1467-8543.2009.00716.x
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    References listed on IDEAS

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    1. Anthony Ferner, 2000. "The Underpinnings of 'Bureaucratic' Control Systems: HRM in European Multinationals," Journal of Management Studies, Wiley Blackwell, vol. 37(4), pages 521-540, June.
    2. Tony Royle, 2006. "The Dominance Effect? Multinational Corporations in the Italian Quick-Food Service Sector," British Journal of Industrial Relations, London School of Economics, vol. 44(4), pages 757-779, December.
    3. Chris Smith & Peter Meiksins, 1995. "System, Society and Dominance Effects in Cross-National Organisational Analysis," Work, Employment & Society, British Sociological Association, vol. 9(2), pages 241-267, June.
    4. Nathan Lillie, 2004. "Global Collective Bargaining on Flag of Convenience Shipping," British Journal of Industrial Relations, London School of Economics, vol. 42(1), pages 47-67, March.
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    Cited by:

    1. Felix Hadwiger, 2017. "Looking to the future," Transfer: European Review of Labour and Research, , vol. 23(4), pages 409-424, November.
    2. Sabrina Colombo & Marco Guerci & Toloue Miandar, 2019. "What Do Unions and Employers Negotiate Under the Umbrella of Corporate Social Responsibility? Comparative Evidence from the Italian Metal and Chemical Industries," Journal of Business Ethics, Springer, vol. 155(2), pages 445-462, March.
    3. Veronika Dehnen, 2013. "Across Boundaries: The Global Challenges Facing Workers and Employment Research 50th Anniversary Special Issue," British Journal of Industrial Relations, London School of Economics, vol. 51(3), pages 577-600, September.

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