Nordic subsidiaries in the Baltic States: is model transfer possible?

Purpose – This research seeks to ask to what extent model transfer in employee relations (in terms of employee representation, participation and workplace bargaining) occurs between Nordic and Baltic countries from the principal firm to the subsidiary. It also looks into explanations as to why model transfer occurs – or does not occur – from the perspective of the Nordic industrialist's labour management strategy. Design/methodology/approach – This is a case study comprising three clothing manufacturers and three engineering shops in different Baltic States: Estonia (population 1.4 million), Latvia (2.3 million) and Lithuania (3.4 million). These production sites have headquarters in three Nordic countries: Denmark, Norway and Sweden. Semi‐structured (thematic) interviews are carried out among managers, shop stewards and employees of the subsidiaries. Findings – There is little model transfer between the Nordic principal firm and the Baltic subsidiary, whereas the Nordic employer prefers local forms of employee relations. Modest model transfer derives from the desire for controlling the labour process, where the Nordic investor seeks to utilise differences between the regimes. Social implications – The Nordic industrialists' search for the distinction between different regimes and the Baltic drive at liberal market economy (LME) together may prove fatal for labour conditions. Such production policy will not improve the position of the Baltic worker. Originality/value – The findings question the very idea of model transfer: where any labour management strategy existed, there was either an unambiguous assertion of indigenous solutions or adoption of “best practices” not peculiar to the Nordic labour relations regime.