Thyssenkrupp's Job Cuts: A Look at the Social Plan and IG Metall's Response
Thyssencrupp Steel to execute a social plan for workforce reduction - Thyssenkrupp Steel seeks a social plan to facilitate job reductions.
Germany's colossal steel player, Thyssenkrupp Steel Europe, is steaming ahead with its announced job cuts of around 11,000 positions back in late November. As reported to West German General Newspaper (WAZ), the company's new HR honcho, Dirk Schulte, has revealed negotiations with the union, IG Metall, will commence soon.
This impending social plan is expected to incorporate measures like early retirement packages, severance deals, and transfer companies. Schulte pointed out, "The number 11,000 stands," meaning the number of jobs to be axed stays the same.
IG Metall, on the other hand, has shown resistance towards the plans. In essence, Thyssenkrupp Steel unveiled, in November 2021, a strategy to shrink the workforce from the current 27,000 to 16,000 over six years. This would involve trimming 5,000 jobs via production and administrative adjustments and outsourcing another 6,000 jobs to external service providers or selling off business units.
IG Metall hit back with a barrage of criticism and announced a bitter resistance. By the end of last year, the union demanded certain prerequisites for negotiations: dismissals and plant closures due to operational reasons be ruled out, and the company's long-term financing be secured.
In a surprising turn of events, Thyssenkrupp and IG Metall have recently sealed a non-layoff pact, opting for voluntary workforce adjustments and plant changes, to ensure future resilience in the steel business. This agreement underscores cooperation and voluntary measures, rather than compulsory job cuts.
Insights
- Voluntary Measures: Instead of forced layoffs, Thyssenkrupp is exploring measures like early retirement, severance packages, and transfer companies.
- Cooperative Approach: IG Metall's approach to this agreement highlights collaboration over compulsory job cuts.
- Job Security Concerns: Specific facilities like the Krupp Mannesmann steelworks in Duisburg face uncertain futures despite the agreement.
- Restructuring Plan: Thyssenkrupp's restructuring plan forms part of a wider transformation strategy to turn the conglomerate into a holding company, involving unit spin-offs and potential sales. Despite denying specific job cuts in this plan, concerns about employment still linger.
The new employment policy by Thyssenkrupp, as revealed by Dirk Schulte, includes voluntary measures such as early retirement packages, severance deals, and transfer companies to achieve a workforce reduction.
IG Metall, however, has shown resistance to Thyssenkrupp's employment policy, demanding that dismissals and plant closures due to operational reasons be ruled out and the company's long-term financing be secured before negotiations commence.
