Helsinki (07.04.1998 - Juhani Artto) To many people around the world, the Ikea brand signifies no more than homely furnishings. Recently, however, The Sunday Times exposed an uglier side of this giant, originally Swedish multinational concern.

The newspaper reported on working conditions at the Romanian Magura plant: one of Ikea's numerous subcontractors. On average its workers earn less than 17 US dollars for a 44-hour working week, i.e. about 40 cents per hour.

The Magura plant was privatised in 1992. The managers of the company became its new owners with the help of a loan provided by Ikea.

The Sunday Times report caused strong reactions in the Nordic trade unions. Norway's wood industry workers union declared its willingness to launch a boycott against Ikea, provided that wood industry workers unions in Finland, Sweden, Denmark and Iceland joined the initiative.

In this heated atmosphere another way forward was found. Ikea and the Federation of Nordic Construction and Wood Workers signed an agreement whereby Ikea promised to behave in an orderly manner and to demand the same of its subcontractors. These must all honour the international agreements and recommendations negotiated within the International Labour Organisation, ILO. The agreement should guarantee that employees of Ikea's subcontractors everywhere have the right to set up and join trade unions and to negotiate collective agreements.

In their joint statement, the Federation and Ikea favour improved international codes of practice for working life. The parties plan to create a joint system to supervise enforcement of their agreements and to stay in regular contact concerning the development of the industry.