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Union fights for fair collective bargaining at ArcelorMittal in Ukraine

7 April, 2021The Trade Union of Metalworkers and Miners of Ukraine (PMGU) is demanding a 30 per cent wage increase for nearly 24,000 workers at the ArcelorMittal Kryvyi Rih steel plant to reach the wage level of industry competitors and cover inflation.

One thousand workers took part in a protest rally organized by PMGU on 30 March to express their objection to the company’s unilateral decision to increase wages by only five per cent from 1 May 2021. Ukraine has a high inflation rate and increase of consumer prices, which for 2020 reached 27 per cent for utility bills, 37 per cent for electricity tariffs, 19 to 56 per cent for bread, pasta, flour, cereals, eggs and sugar. The increase of 5 per cent imposed by company management is in fact a significant wage cut.

The management decision on wage levels was taken unilaterally, without union involvement, in violation of the collective agreement that states that determination of the increase shall be carried out annually based on the company’s performance, and with union approval. The previous wage increase took place in May 2019, with workers patiently waiting two years for an increase, mindful of the employer’s challenges related to the Covid-19 pandemic in 2020. The unilateral decision is seen as a blatant breach of the principle of negotiation in good faith.

The PMGU insists that now is the time for a proper wage increase. The economic situation at the industry and company levels has improved due to the revival of the steel products sales market and significant growth in steel products and concentrate prices, growth in the volume of production and sales of products in the fourth quarter of 2020 at ArcelorMittal Kryvyi Rih, profit from the main operating activities in 2020, the attainment of designed indicators by the main production capacities, and the growth of the rate of foreign currency that the company earns for its products.

Moreover, the current low wage at ArcelorMittal Kryvyi Rih and its affiliated companies, Steel Service and Foundry and Mechanical Plant, forces workers to seek employment at competitor companies with higher wages, which results in understaffing at most subdivisions with difficult and harmful working conditions, eventually leading to higher occupational accident rates. There were 33 accidents in 2020, compared to 22 accidents in 2018. Therefore, on top of the wage increase, the union also demands the timely implementation of measures to improve working conditions, and prevent accidents and occupational diseases.

Natalya Marynyuk, local chair of PMGU at ArcelorMittal Kryvyi Rih said that since September 2020 the union has addressed the CEO seven times regarding the wage increase and insisted that negotiations be sped up. However, for almost half a year, management has deliberately impeded the negotiation process to postpone the date of the wage increase for as long as possible.

“This is the first time in 15 years that the company management has announced such an unreasonably low percentage wage increase, adopted unilaterally without the union’s consent. PMGU strongly objects to this decision, considers it unfair and a deliberately underestimate in the context of the company’s financial capacity, obtained thanks to the hard work of its workers.

“Together we will achieve a fair level of salary for all workers!”

On 5 April, PMGU submitted a letter to the President of Ukraine, Volodymyr Zelensky, urging him to intervene with the company to meet the union’s and workers’ demands.

In the letter to the company management, IndustriALL general secretary Valter Sanches said:

“We stand firm in solidarity with the Trade Union of Metalworkers and Miners of Ukraine and supports the union’s demands to significantly increase wages by 30 percent for all workers at PJSC ArcelorMittal Kryvyi and its affiliated companies. In this sense, it is imperative that ArcelorMittal Kryvyi Rih engage in a genuine social dialogue with the union.”