Iscor puts a moratorium on 1 600 retrenchments
October 21, 2003
By Sherilee Bridge
Johannesburg - Steel maker Iscor said yesterday it had agreed to stall retrenchments for two months while it worked with trade unions to find a way around the possible loss of 1 600 jobs.
The company and "certain of its representative trade unions" agreed to a two-month moratorium on retrenchments after Iscor said it "was contemplating new efficiency measures to mitigate the impact on the business, brought about by the collapse in steel demand and the ongoing strengthening of the South African currency".
Louis van Niekerk, Iscor's chief executive, noted in the group's annual report that the magnitude of the currency strengthening in the first six months of this year had "put our competitive position under threat and brought a new urgency for further cost reduction".
To achieve this Iscor had embarked on a major reorganisation, involving the collapsing of all its operations into a single business unit. It believed this could unlock significant synergies in support services.
Iscor said the moratorium, which was "aimed at finding solutions while taking account of the impact on the company and staff", expired at the end of November. That leaves the company and unions just over a month to find a solution to the possible job cuts.
Iscor said the time would be used to "fully investigate the case for change, while simultaneously continuing the consultation process on possible retrenchments at a future date".
Participating unions are Solidarity and the United Association SA, which represent close on 5 000 of a total 13 000-strong workforce.
The National Union of Metalworkers SA (Numsa), which represents about 3 500 employees, was not included.
Dumisa Ntuli, a Numsa spokesperson, said as many as 2 000 jobs could be slashed in the next three months.
"We strongly condemn the threat to slaughter an extra 2 000 workers because the impact of the strong rand takes time to be felt," Numsa said in a statement released yesterday.
Numsa said Iscor's employment figures had fallen from 44 000 in the 1980s to 18 000 in 1997 and to 13 000 now.
While Iscor claims it achieved cost savings of 8.2 percent in the financial year to June 2003, it said steel production costs were up 3.1 percent on the previous year.
Iscor's shares closed 1.51 percent, or 34c, lower at R22.20 yesterday.
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