Memo Human resources: The Lidl case (2008)

Résumé du document

The Concept of purchasing power has been highly debated in France for the last few months. Because of a recent and substantial increase in prices, grocery retailers have been under suspicion of being the main engine of this inflation. Why have prices been increasing so quickly in the last few weeks? The French government is currently trying to increase competition and is considering raising regulations in the sector. Moreover very recently some secret agreements between firms in the supply sector were revealed. That is why in such a context, discount grocery retailers seem to be very attractive for numerous customers. However, Lidl one of Europe's leading grocery retailers, has been sued by many of its former employees for unacceptable working conditions and abusive layoffs. To what extent do Lidl's cheap prices benefit the customer? Has Lidl's social policy had an impact on the employment market? Because of the current debate on those questions, I wanted to study the human resources policy of Lidl while reminding all the constraints of such a competitive market. We will try to determine whether discounted prices are always tightly linked to discounted human resources practices.

Extraits

[...] A simple way to cut costs in such a sector is therefore to have fewer employees or to pay them less. Lidl uses both. Employees are paid as less as local law authorizes it and have multiple tasks to do. In other words, they do more for less: the dream of every diabolically capitalist CEO. Certainly from a business point of view, Lidl is highly successful, but it is hard to consider that Lidl has brought something positive to our economies. [...]

[...] However European Union had set some rules of corporate behavior, which Lidl will have to respect. Actually Lidl still does not comply with the statement on corporate social responsibility, which the European social partners for commerce signed in Brussels November 2002. In 2006, Lidl top management realized that something had to be done to curb the growing movement against the company. Lidl responded to negative market forces and launched a massive communication campaign, especially in Germany. The LIDL FOOTBALL CUP Lidl is from now on focusing on proactive communication. [...]

[...] No extra services but any hidden charges. At Lidl all the prices claim to be the most competitive day after day. In the stores a number of products are sold directly from boxes or from pallets: savings of personal, time and money. It is part of Lidl's simplicity philosophy: keeping everything straightforward for the customer in order him to save more. Some key figures Lidl started its activities in Germany and expended aggressively throughout Europe and parts of the rest of the world. [...]

[...] Pockets are searched, as well as workers' cars at the parking places. Everything that is consumed at the workplace during the breaks yoghurt or a soft drink bottle) must not only have a cash ticket taped to it, but the ticket must also be signed by the supervisor. A former Lidl employee explains:” After work, in my store, coats, handbags and cars were inspected: Then I came always without a coat or handbag, I was afraid that they would put something into them. [...]

[...] Many workers are simply fired without a notice period. VI. Human resources practices for the whole employee life cycle Human resource management apparently has only one aim: maximizing the profits. As a consequence top managers put store managers under enormous strain and number of employees in a store, are strictly tied to sales. Store managers must obey to headquarters orders. As a consequence they have very little freedom to manage the store as they would like to. Extremely long working weeks, and pressure on personnel to do unpaid hours, are frequent. [...]