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Return to equilibrium made possible by an innovative corporate agreement validated by referendum

The initial reform strategy adopted in 2016 by LNE has now yielded record results for the laboratory.

Employee input by way of referendum on an agreement to restore equilibrium and preserve jobs represents a first-time practice within a French public sector institution. 
Handled in consultation with labor organizations, the approach implemented has produced outstanding results for an entity that, after traversing a 3-year period saddled with large deficits, now boasts a dramatic shift in operating earnings, spiking from -3.9 million euros to a level of +2.1 million, its highest ever.

Reforms carried out with massive staff support

This turnaround for the National Metrology and Testing Laboratory is noteworthy for the method utilized. Employees validated in mass the measures required to restore equilibrium and save jobs during a referendum, held in conjunction with labor organizations, in June 2016.

These measures (which included a freeze on hiring, a one-third cut in budgeted bonuses, postponement of raises and promotions) were all intended to restore equilibrium and preserve as many jobs and as many in-house resources as possible, while avoiding wholesale layoffs. The package of measures proposed respected a principle of equity, with sacrifices evenly spread.

The new strategy and principles pursued as the agreement was being rolled out inspired employee confidence: they accepted to make the requisite efforts in rallying to save their institution and keep the workforce intact.

A spectacular turnaround

The outcome of this mobilization call has been truly spectacular inasmuch as the laboratory's profitability (operating earnings / revenue) climbed 11 points in 2016, a figure that takes into account the full payout of bonuses, in accordance with the "better fortunes" clause included in the June agreement. 
This result places LNE on a very positive course. By growing its gross operating surplus, operating profit and self-financing capacity by nearly €6 million each, the Laboratory has once again generated some financial maneuvering room and looks to the future with optimism.

A development strategy based on innovation and investment in leading-edge technologies

With almost 80% of its operating earnings generated from revenue streams as remuneration for services provided on behalf of corporate and local authority clients, LNE as a public sector industrial and commercial entity (EPIC classification in France) was bound to adopt measures aimed at restoring its competitiveness and investment capacity.

These outstanding results have thus strengthened LNE's position as a national reference laboratory in the field of measurement, testing and certification. This solid footing will serve to further develop its actions to benefit industrial innovation, environmental quality, public health and safety across the world.

The Laboratory and its 800 engineers, researchers and technicians are tasked with supporting corporate competitiveness and offering expert advice to the State in shaping and implementing public policy.
In 2016, LNE, as a trusted partner of the business sector, allocated resources to strategic areas like the Factory of the Future, the environment, nanomaterials, robotics, digital technologies and public health.

A numerical overview

Results of the referendum held on the agreement to restore equilibrium and preserve jobs: 80% participation, and 72% "yes" votes.

(in millions of €)  2013  2014 2015 2016
Sales revenue  51,4 53,4  54,0  54,7 
Gross operating surplus  2,2 2,0 -1,3 4,5
Operating earnings -0,3  -0,9 -3,9 2,1
Net profit  -0,8 -0,8 -3,3 0,3
Operating earnings / Revenue -0,6% -1,7% -7,2% 3,8%

 

 

Structural reforms were essential to turn LNE's situation around and return to growth after experiencing serious crises, in terms of both finances and confidence. The referendum outcome underscores the quality of the dialogue held with employees and their dedication to the Laboratory. A sense of collective pride runs deep here. I'm pleased by the level of trust placed in me by the LNE workforce, as well as by the changes we've led together and the fruits we're now all enjoying in having instituted these bold reforms.

Thomas GRENON, LNE Managing Director

LNE contact

Press contact : Valérie MULOT - +33 (0)1 40 43 40 93 - valerie.mulot@lne.fr 

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