Picnic warns it may leave Netherlands if workers fall under collective labor agreement

Grocery delivery company Picnic will not be able to continue operations in the Netherlands if they have to abide by the collective labor agreement for supermarkets, the company’s CEO, Michiel Muller, said on the radio show Sven op 1.

The government previously granted Picnic an exemption, allowing the company not to comply with the collective labor agreement for supermarket staff. The Ministry of Social Affairs is currently reviewing a new request from Picnic for an exemption.

Muller said to the presenter, Sven Kockelmann, that the company is currently not contemplating a departure from the Netherlands. “But if we are not granted an exemption from the next collective labor agreement, then this will be discussed. Because then we will have 40 percent higher costs than the shops. It will make it impossible for us to compete, and that means you have to bring your investments to other countries.”

Picnic has argued that it differs so much from supermarkets that requiring the grocery delivery company to comply with the supermarket collective labor agreement would create an uneven playing field. According to Muller, this is partly because supermarkets employ many young workers, while Picnic does not.

Muller added in the interview that his quotes are not meant as a threat of leaving the country. “It is the result of a supermarket collective labor agreement that is very cheap for supermarkets and very expensive for us. Their business model is based on avoiding their own collective labor agreement terms, namely through youth wages and temporary agency workers.”

In June, the Arnhem-Leeuwarden court of appeal ruled that Picnic does fall under the collective labor agreement. In practice, this meant that the company had to apply the collective labor agreement for the period between September 2022 and July 2023, giving thousands of employees entitlement to certain allowances.

It was recently revealed that the Netherlands Authority for Consumers and Markets (ACM) also has concerns about Picnic’s ability to compete with traditional supermarkets if the supermarket collective labor agreement is applied to the company.

Such a general obligation could have negative consequences for Picnic, which, unlike traditional supermarkets, employs hardly any young people who are still paid youth wages. The market regulator asked Minister Eddy van Hijum to take this into account when making a decision on the exemption.