Mondragon Multi-localisation Strategy: Innovating a Human Centred Globalisation
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Such impact regards a dual relationship: the one between “parent co-operatives and affiliated non-co-operatives”, and the relationship between “capital ownership and working capacity” at the affiliated companies.
3.4.5
Salary scale
The remuneration gap, one of the historical signs of identity of the Mondragon Group, has also been modified. From the beginning in 1956 the 1/3 salary scale was maintained; at the Mondragon First Congress in 1988 the maximum limit up to 1/6 was approved by 147 in favour and 132 against101. At the Mondragon Third Congress in 1990 the 1/6 was modified, fixing the top wage level at 30% less than the salary corresponding for the same post in the market. According to Larrañaga, for supporters of an opener system there is no doctrine that conditions the salary scale; it depends on a decision of the members and on the evolutionary variable of the surroundings. In practice this is misleading, when applied to the recruitment of high-level professionals, for need pressures the immediate competitive space (Larrañaga, 2006: 66). This historic change is due more to an internal approach than to a direct impact from globalisation. According to the information provided by the Mondragon Group102, at the end of 2006 the average among the Mondragon Group was 1/4, while the lowest for a full time job at an industrial cooperative was 1.7-1.8 and the whole group highest salary 8.8. However, globalisation impacts directly on the “wage solidarity” in two ways: − In the production plants abroad a “wage solidarity” culture is non-existent; still more, in some cases same management posts acquire a larger salary in emerging countries than at the parent co-operatives in Mondragon; in those countries wages of blue collar employees are considerably (from five to hundred times) smaller than the wage for the same post at the parent co-operative103.
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The 1/3 salary scales means that the minimum salary cannot be smaller than three times the biggest salary of the co-operative. The 1/6 means smaller by six times. 102 Information provided by Mondragon Group Social Management department (2007). 103 As Chapter 7 will present, analysis of 40 production plants abroad revealed that only one (Fagor Ederlan Brasileira) is monitoring the “wage solidarity”. José María Luzarraga - PhD Candidate Mondragon University - 2008