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Concern Over Steel Industry

Wednesday, October 15, 2014

GMB And Other Steel Unions Seek Urgent Meeting With Tata Steel Chair To Discuss Sale Of Long Products Business

We want Tata Steel to take a step back and carry out the consultation with its unions, which it should have been doing in recent months when it was preparing to sell its assets says GMB.

GMB and other unions in the steel industry issued a statement responding to Tata Steel announcement of sale of Long Products business which employs 6,500 workers. See notes to editors for copy of Tata Steel press release.

The statement says “The trade unions within Tata Steel – Community, Unite and GMB – are disappointed by today’s announcement. Tata Steel has failed to consult at all with the trade unions before making this move, which could have serious consequences for employees and contractors right across Tata Steel, not just within the Long Products business that it wants to sell. The unions have been treated with contempt in this process as the level of consultation that we would expect ahead of such a major strategic announcement has not taken place. We were made aware of this fait accompli two days ago which is neither within the spirit nor the letter of longstanding Information and Consultation or European Works Council agreements.

We have no comment to make about the potential buyer, the Klesch Group, as at this stage we are opposed to the principle of the sale. We will be seeking an urgent meeting with Tata Steel Chairman Cyrus Mistry, to discuss his motivation for this move and to explain the potential consequences. We want Tata Steel to take a step back and carry out the consultation with its unions, which it should have been doing in recent months when it was preparing to sell its assets.

The fact that Tata Steel wants to abandon half of its European operations and pull out of an entire strategic market does not bode well for the future and ends Tata Steel’s vision to be a global steel player. Tata Steel has long emphasised that its European operations are ‘one company’ but today’s announcement is the final nail in that concept’s coffin.

Next week, we will bring together trade union representatives from across Tata Steel to discuss the course of action that members wish to take. We are also calling on the government to intervene in the public interest to ensure a future for industrial assets of strategic importance to the UK’s construction, infrastructure and manufacturing base.

Our immediate thoughts are with those employees, contractors, families and communities that are worried about their future and we would urge Tata Steel to follow its own Code of Conduct and act in the interests of the communities in which it operates by engaging in meaningful consultation with its trade unions before it progresses the terms of this Memorandum of Understanding.”

End

Contact David Hulse 07971 266157 or 0208 947 3131 or GMB press office

Notes to editors

Press release from Tata Steel 15 October 2014

Tata Steel’s European business signs Memorandum of Understanding regarding its Long Products Europe business

Tata Steel has today announced the signing of a Memorandum of Understanding with Klesch Group to undertake detailed due diligence and negotiations for the potential sale of its Long Products Europe business and associated distribution activities.

The memorandum covers several UK-based assets including Tata Steel’s Scunthorpe steelworks, mills in Teesside, Dalzell and Clydebridge in Scotland, an engineering workshop in Workington and a rail consultancy in York, as well as other operations in France and Germany [see to Notes to editors for list of sites]. About 6,500 people are employed at Long Products Europe and its distribution facilities. Tata Steel employs 30,500 people across Europe, including 17,500 in the UK.

Karl Koehler, Chief Executive of Tata Steel’s European operations, said: “We will now move into detailed due diligence and negotiations, though no assurance can be given about the outcome. We will regularly engage with our employees and other stakeholders throughout this process, and we will consult with the trade union representatives and works councils.”

Explaining the context and rationale for this decision, Mr Koehler said: “We are making huge strides on our strategic journey to become a premium, customer-centred steel company thanks to investment in equipment, technology and customers, together with the substantial contributions from our employees.

“We’ve improved the competitiveness of Tata Steel’s European operations, including Long Products Europe which now supplies more of the innovative steel rail, rod, plate, sections and special profile products demanded by customers.

“Accelerating the pace of innovation on advanced steel solutions, helping our customers succeed in their markets and creating a sustainable asset base requires significant capital and expertise.

“We have therefore decided to concentrate our resources mainly on our strip products activities, where we have greater cross-European production and technological synergies.

“We want to build a sustainable business in the UK and further develop our mainland Europe business and we are committed to providing the necessary leadership and financial resources to achieve that.”

The European steel industry is emerging from one of the most challenging economic periods in its history. Tata Steel has invested £1.2 billion in its UK operations and trained 1,200 UK apprentices and graduates since acquiring Corus in 2007.

-ends-

For further information, contact:

Tata Steel:

Bob Jones on +44 (0)207 717 4532 or bob.jones@tatasteel.com

Rob Simpson on +44 (0)7990 786531 or rob.simpson@tatasteel.com

Klesch Group:

FTI Consulting – Richard Mountain or Susanne Yule on +44 (0)20 3727 1340

Notes to editors:

Tata Steel’s Long Products Europe business is made up of the following facilities:

<!--[if !supportLists]-->· <!--[endif]-->Scunthorpe integrated steelworks

<!--[if !supportLists]-->· <!--[endif]-->Teesside Beam Mill, Lackenby

<!--[if !supportLists]-->· <!--[endif]-->Special Profiles, Skinningrove & Darlington

<!--[if !supportLists]-->· <!--[endif]-->Dalzell Plate Mill, Scotland

<!--[if !supportLists]-->· <!--[endif]-->Clydebridge, Scotland

<!--[if !supportLists]-->· <!--[endif]-->Immingham Bulk Terminal (port terminal)

<!--[if !supportLists]-->· <!--[endif]-->Hayange Rail Mill, north east France

<!--[if !supportLists]-->· <!--[endif]-->Engineering workshop, Workington

<!--[if !supportLists]-->· <!--[endif]-->Rail consultancy, York

The associated distribution sites which are part of the potential sale are located in:

<!--[if !supportLists]-->· <!--[endif]-->Teesside

<!--[if !supportLists]-->· <!--[endif]-->Scunthorpe (two locations)

<!--[if !supportLists]-->· <!--[endif]-->Newcastle

<!--[if !supportLists]-->· <!--[endif]-->Edinburgh, Scotland

<!--[if !supportLists]-->· <!--[endif]-->Dundee

<!--[if !supportLists]-->· <!--[endif]-->Mosstodloch, Scotland

<!--[if !supportLists]-->· <!--[endif]-->Hull

<!--[if !supportLists]-->· <!--[endif]-->Wolverhampton

<!--[if !supportLists]-->· <!--[endif]-->Dartford

<!--[if !supportLists]-->· <!--[endif]-->Brandon

<!--[if !supportLists]-->· <!--[endif]-->Newton Abbot

<!--[if !supportLists]-->· <!--[endif]-->Stoke

<!--[if !supportLists]-->· <!--[endif]-->Lisburn, Northern Ireland

<!--[if !supportLists]-->· <!--[endif]-->Dublin, Ireland

<!--[if !supportLists]-->· <!--[endif]-->Cork, Ireland

<!--[if !supportLists]-->· <!--[endif]-->Mülheim, Germany

<!--[if !supportLists]-->· <!--[endif]-->Zwickau, Germany

<!--[if !supportLists]-->· <!--[endif]-->Hamburg, Germany

<!--[if !supportLists]-->· <!--[endif]-->Stuttgart, Germany

About Tata Steel’s European operations

Tata Steel is Europe's second largest steel producer, with steelmaking in the UK and Netherlands, and manufacturing plants across Europe. The company supplies products and services to the most demanding markets, including construction, automotive, packaging, rail, lifting & excavating, energy & power and aerospace. The combined Tata Steel group is one of the world’s largest steel producers, with a steel capacity of 29 million tonnes and 80,000 employees across four continents.

 

 

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