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Arcelormittal strike ends after NUMSA scores legal victory

Metal coils are seen at ArcelorMittal steel plant in Ghent

Metal coils are seen at ArcelorMittal steel plant in Ghent

Published May 26, 2022

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Steel maker Arcelormittal and the National Union of Metalworkers of South Africa (NUMSA) have shaken hands on a 6.5 percent increase and an ex-gratia once-off cash payment of R5000 to end the strike which started earlier this month after the Labour Court dismissed an application by the group to interdict a national strike at all of its South African plants.

In a late-night statement, NUMSA praised its workers' resilience.

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"The employer started by offering zero per cent, and we have moved significantly to achieve this result. As a result, the strike at AMSA is over. This agreement is a victory for all NUMSA members who made the ultimate sacrifice to fight for improved wages and conditions. They did not do this only for themselves, but also, for future generations of workers as well," Numsa's Phakamile Hlubi-Majola said.

The agreement translates to a 6.5 percent increase in allowances including the acting allowance, housing allowance, retention allowance, compulsory overtime allowance, pension allowance, shift allowance, standby allowance and Proto Team allowance.

Numsa's opening gambit on the strike was a 10 percent increase across the board while Arcelormittal opened the house with a zero percent offer which log jammed, resulting in the three-week strike and court action that threatened the group's stability, hence the quick turn around.

Analysts said Arcelormittal's buttons were pushed by the markets which indicated displeasure with the share price taking a significant knock that affected the company’s bottom line.

The increase will be backdated to 1 April and will be payable on the normal pay date for the month of June 2022, allowances will also be backdated and paid in June while the parties also agreed to investigate other incentives for an employee incentive share scheme including ESOP and the KPI bonus/Gainshare.

"To achieve an above-inflation increase during the Covid-19 pandemic is a major achievement and it would not have been possible without them. We also wish to thank NUMSA officials for working extremely hard to secure this deal on behalf of employees," Hlubi-Majola said.

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Arcelormittal CEO Kobus Verster was initially adamant the global group would not fold to the demands of only one union and initiated a plan to approach the labour court for an interdict because certain workers were quite important to the organisation and their downing tools would not make for a pretty picture in terms of its operations.

At the beginning of the strike, Venter said the group had  an interdict of the strike for about 50 percent  of operations, essentially on upstream operations where the assets are fragile.

"Well, it’s affecting our operations quite severely. Firstly, the part that’s not supposed to strike – those that are, as I said, in contravention of the court order are striking. And then obviously, as normal, there’s substantial intimidation. Remember, there’s a strike called by only one union, not all unions. And then there’s the intimidation preventing people who actually want to work from coming to work. Overall that impact is quite severe," Venter said in an interview.

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Arcelormittal was insistent that its initial offer of a  5 percent inflation adjustment, and an additional 2 percent took the lowest level of employee to a R25 000 package.

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