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German steel giant ThyssenKrupp has announced a “negotiated settlement” with its workers to clear the way for its proposed joint venture (JV) with Tata Steel Europe. As part of the agreement made with workers’ union IG Metall, ThyssenKrupp employees have won a guarantee of job security until September 30, 2026. The union will now put the negotiated settlement to a vote at ThyssenKrupp’s steel sites in January 2018. “In the joint working group set up by the ThyssenKrupp supervisory board, ThyssenKrupp and trade union IG Metall have reached a negotiated settlement on the conclusion of a collective agreement. The agreement will set collectively agreed parameters for the planned combination of the European steel activities of ThyssenKrupp and Tata Steel Europe in a 50:50 JV,” the German steel major said in a statement. Following the settlement, the company hopes to complete its JV with Tata by the end of next year. Its settlement with steelworkers applies to all of ThyssenKrupp’s German steel sites. The collective agreement is to come into force with the start of the JV and apply for around eight years until September 30, 2026, it said. ThyssenKrupp had announced the formation of a JV of its European steel activities with Tata Steel Europe in September. The new firm would have pro-forma sales of roughly €15 billion and employ around 48,000 people. “The settlement corresponds with our understanding of corporate responsibility. It gives us the ability to achieve the economic advantages and synergies forecast for the JV and so create value as planned for ThyssenKrupp and its shareholders. At the same time, we are providing the employees of the JV with good prospects for the future and securing jobs,” said Heinrich Hiesinger, chief executive officer of ThyssenKrupp AG. Oliver Burkhard, chief human resources officer of ThyssenKrupp AG, said, “We have agreed on the conclusion of a collective agreement that takes account of everything we attach importance to at ThyssenKrupp: A joint solution with the employee side in line with our corporate culture.
This result does justice to the interests of the company and of our employees. It enables us to provide security for our workforce and creates good prospects for the JV.”The company said it had given far-reaching assurances for site continuation, with the future of the majority of sites assured until September 30, 2026. Investments will continue to be made in the German sites at the present level. The company said its goal is to invest at least €400 million per year in the enhancement of production facilities. ThyssenKrupp will hold an interest in the JV for at least six years. At the same time a change to the shareholder structure, possibly as the result of an initial public offering, is not ruled out during this period. Alongside the retention of coal and steel codetermination in Germany, the collective agreement provides for the establishment of an employee executive committee, in which the board and employee representatives of the JV will discuss strategic issues three times a year. The steel employee representatives will continue to belong to the Group Works Council of ThyssenKrupp AG. Steel employees will retain their active and passive voting rights for the supervisory board of ThyssenKrupp AG. The IG Metall union’s collective bargaining committee has recommended accepting the agreement when it comes up for a vote in the New Year.
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