Originally published in the Sunday Guardian (Aug 12th) by a Guest Author and was republished by the Energy Chamber
Just as more noise is made about the future – if any – of the former Arcelor Mittal site in Point Lisas, European steelworkers are beginning to see the end of the tunnel in what have been nearly five years of bleakness for the industry.
Their better prospects cannot be solely linked to improved market conditions; although prices have gone up since the big drop that started in 2014, the world still produces more steel than needed, especially as China continues to churn great volumes of the stuff and goes on to sell its surplus cheaply.
Instead, there are several good reasons for the fact that steelworkers in Europe can feel more confident about their future: the kind of specialised steel they produce, specific market conditions and a number of mergers and acquisitions have helped. But another good and consistent reason is the practice of realistic and grown-up industrial relations.
T&T’s steel operations were not immune to the awful times faced by other plants around the world. That’s why, from 2014, Arcelor Mittal’s local management sought to engage with its workers’ union, SWUTT, to discuss ways to reduce cost and make the business competitive. After all, sales had collapsed and it cost more for the plant to produce its steel than the prices charged by Chinese suppliers.
Anyone who was privy to the negotiations will know that SWUTT opposed pretty much every single proposal put forward to save money (and preserve jobs). Attempts to temporarily mothball some of the units by transferring staff to another part of the operation were opposed by the union as it raised concerns over the number of toilets in the area.
As important as toilets are, most sensible people – but not our unions - would rather opt for a temporary toilet should that be the kind of sacrifice needed to preserve jobs. It was the equivalent of workers on the Titanic arguing over better meal allowances already knee-deep in water.
When told that workers in Europe were taking pay cuts to help keep their jobs and the companies afloat, SWUTT’s reply was for management to adopt European pay rates before applying a reduction. Stuff of genius. In short, the union’s solution was for Arcelor Mittal to increase their cost base, thus making the products even less competitive when they were already being undercut by the Chinese.
More timewasting and rejections for nearly a year led to the decision by the company to lay off staff temporarily in an attempt to stop the financial bleeding and save the company. The union’s reaction was predictable: it took the issue to the Industrial Court.
In March 2016, the Court found in favour of the union (ignoring the industry’s worldwide plight and siding with the need for more talk between the parties despite the union’s repeated rejection of pretty much every proposal previously advanced by the company).
What happened next, was predictable. The union celebrated its victory on a Thursday and Arcelor Mittal closed its doors the following day. To put it bluntly, it had had enough of T&T’s industrial relations antics, took its steelworks and went.
Now contrast this scenario with what was going on in Europe at the same time. Steel plants there were also under threat – with some being closed – as China’s glut and slumping prices also hit them hard.
Traditional steelworks like Wales’ Port Talbot and England’s Scunthorpe, for instance, were lined up for closure by its parent company Tata Steel. Discussions were being held by the owners, unions and government to try and find a solution.
For Port Talbot, changes to pension arrangements for existing workers were seen as key to pave the way for a Europe-wide merger between Tata and Thyssenkrupp aimed at safeguarding several plants and thousands of jobs across the continent. They were agreed and implemented, with the merger confirmed just over a month ago, including guarantees on jobs and investments.
Perhaps even more dramatic was the turn of events in Scunthorpe as it faced the loss of over 150 years of steelmaking history. Just as SWUTT leaders here were dragging their feet over temporary leave at the T&T plant, Scunthorpe’s union leadership was agreeing to pay cuts and lower pension entitlements in a bid to save some 4,000 direct jobs.
With the deal agreed - and just as we were grieving the end of steel production in T&T- the Scunthorpe plant was sold in April 2016 for the equivalent of TT$10 to a private-equity company, rebranded as British Steel and set down the path of a recovery plan.
Since the dark days of near closure, the company returned to profitability, its new owners reversed the pay cut (and agreed to additional pay rises), hired some 1,000 more people, rolled out a staff share-ownership programme and have just announced higher profits and substantial new plant investments.
We, too, could have been riding the same wave of optimism, profits and more jobs if it were not for the all too predictable (and often poisonous) surreal sabre rattling by our unions when even the most uneducated can see a company is heading to a disastrous ending if sacrifices are not made.
In the end, through difficult but realistic choices in Scunthorpe, workers and their unions have preserved their roles. Here, through obstruction and unrealistic demands, the steel workers union survived but not the steel workers. OWTU and Petrotrin workers should pause and reflect on what happened before it is too late.