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ArcelorMittal Temirtau looks to cancel annual readjustment of salaries

19 november 2012, 14:48
0
Photo courtesy of kp.ru
Photo courtesy of kp.ru
Management of ArcelorMittal Temirtau has decided to cancel the practice of compulsory annual readjustment of salaries of the company’s employees to inflation level, KazTAG reports citing Planning and Personnel Director of ArcelorMittal Temirtau Dmitriy Pavlov.

"We (company's management) came up with a suggestion to amend the collective agreements in terms on salaries readjustment at the meeting with the trade unions of the steel and coal departments today. The letters were handed to both trade unions: Zhaktau and Korgau," Pavlov said at the briefing on Friday.

According to him, this step does not mean that the company refuses to raise salaries. "We suggest to cancel the salaries adjustment clause of the collective agreement, but amend it as follows: The management shall annually review the salaries level with consideration of results of business activities of ArcelorMittal Temirtau in the said year," Pavlov said.

The company refers to "a complicated financial and marketing situation" to explain its initiative.

"This practice (annual adjustment of the rates and salaries to inflation) was adopted in 2007, i.e. in the pre-crisis period, when metal prices were very high and sales and production levels were high as well. It was our good will to support our employees. But today we need growth of salaries to be linked to growth of production volumes and profit," Planning and Personnel Director said.

According to the collective agreement, the management's suggestion has to be reviewed within 10 days.

The representative of the management stressed that ArcelorMittal Temirtau is lowering its production, thus, the number of its employees. "Unfortunately, we cannot even meet the business plan this year because of the lowering demand. We will produce around 3 million tons of melted steel in 2012 versus the planned 3.4 million tons," Pavlov said.

He also said that the company has suspended all hirings. Meanwhile, ArcelorMittal Temirtau continues to cut its personnel by means of not replacing those who quit at their own accord. "We plan that around 350-400 employees of the steel department will use the voluntary resignation system. 200 resignations have been reviewed so far today. All of them have been accepted," Pavlov said. According to him, these are mainly the workers who are quiting.

According to the company, an average salary in the steel department of ArcelorMittal Temirtau made 126 thousand tenge ($840), 157.6 thousand tenge ($1,051) in the coal department and 90 thousand tenge ($600) in Orken LLP in October. "The total salaries pool made over 1.9 billion tenge ($12.7 million) in the steel department, over 2.5 billion tenge ($16.7 million) in the coal department and around 300 million tenge ($2 million) in Orken LLP," Pavlov said.

According to the company, there are 15,988 employees in the steel department, 16,191 in the coal department and 3,272 in Orken LLP.

ArcelorMittal Temirtau is part of the international steel-casting concern ArcelorMittal and is the biggest mining and metallurgic company of Kazakhstan. The company has a metallurgical complex in Temirtau, 8 coal pits in Karaganda oblast and 4 iron ore mines in Karaganda, Akmola and Kostanay oblasts.

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