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Kazakhstan: ArcelorMittal debts lead to unpaid wages

22 March, 2016Around 2000 subcontract workers at ArcelorMittal Temirtau in Kazakhstan have not been getting their wages because of the company’s extensive debts to its contractors.

ArcelorMittal Temirtau, the major mining and metallurgical company in Kazakhstan, has been underpaying its 24 contractors for three years, which has resulted in contractors delaying wages to their workers. The average wage of the ArcelorMittal Temirtau contractor worker is around 35-40 thousand tenge (US$100-115) per month.

Sixty per cent of the affected subcontract workers are members of the Temirtau City Union affiliated to IndustriALL Global Union through the Trade Union of Workers of Mining and Metallurgical Industry of the Republic of Kazakhstan.

ArcelorMittal Temirtau’s debt to its contractors has been discussed several times at meetings of the Sectoral Committee for Social Partnership and Labour Relations in the Steel and Mining Industry over the past year. Representatives of ArcelorMittal Temirtau participated in these meetings, but ignored the Committee’s decisions. Every month the company pays less than fifty per cent of its debts, so the total debt keeps on growing and reached 903.5 million tenge (US$ 2.61 million) by 15 February 2016.

The contractors are dependent on ArcelorMittal Temirtau and so do not pursue litigation, or apply to the public prosecutor's office, nor even a labour inspection, for fear of losing their contracts or being fined themselves as happened in July 2015.

As wage arrears lead to social tension, trade unions are demanding that ArcelorMittal Temirtau pay debts to its contractors immediately and consider increasing cost of their prices.

Asylbek Nuralin, Chairman of the Trade Union of Workers of Mining and Metallurgical Industry of the Republic of Kazakhstan, said:

“The social and labour relations based on social partnership, respect of human rights, mutually acceptable combination of workers’ and employers’ interests can provide a sustainable economic and social development of industry enterprises.”

On 16 March, the Trade Union of Workers of Mining and Metallurgical Industry of the Republic of Kazakhstan once again raised this issue at the meeting of the Republican Tripartite Committee for Social Partnership and Social and Labour Relations, and the regional authorities should consider the issue and report results to the Ministry of Healthcare and Social Development of the Republic of Kazakhstan by 18 April.