Workers at ArcelorMittal refuse to budge over wages

The steel manufacturer’s decision to seek an interdict preventing some of its employees from taking part in the national strike has aggravated Numsa, which says it won’t back down from its demands.

A strike by more than 3 500 steelworkers at Africa’s biggest steel producer has been partially interdicted by the labour court on the basis that some aspects of steel production might qualify as an essential service.

The pay strike by members of the National Union of Metalworkers of South Africa (Numsa) at ArcelorMittal began on 11 May. But on the same day, workers at the company’s steel plants, blast furnaces and coke batteries were barred from striking even though a Commission for Conciliation, Mediation and Arbitration ruling on an ArcelorMittal application to have this work declared essential is still pending.

The remaining workers are striking for a 10% wage increase across the board, a housing allowance and the abolishment of labour brokers. It also wants ArcelorMittal to pay 80% of workers’ medical aid fees because the nature of their work – involving heavy chemicals – is hazardous.

12 May 2022: Members of the National Union of Metalworkers of South Africa burn tyres as they embark on strike action at ArcelorMittal over a wage dispute. (Photograph by Reuters/ Sumaya Hisham)

The company has put forward a final offer of 5% across the board for workers and an additional 2% of their salaries in cash as a monthly amount, said Numsa on 9 May. “We reject this proposal. What is a 5% increase for the lowest-paid worker who earns approximately R7 000? It is not much at all,” it said. “At the same time, the 2% cash payout is not an across-the-board increase. It will not result in increases in pension cover.”

However, ArcelorMittal slammed Numsa for being “disingenuous” by stating that the lowest-paid worker at the company earns just R7 000 a month before tax and other deductions. It said that the lowest grade of employees earned R21 423 a month.

But asked to clarify, ArcelorMittal’s spokesperson, Tracey Peterson, conceded that this was the “average cost to company” for a range of employees on one pay grade and not the minimum wage at the company. Peterson said minimum-wage workers cost the company a total of R14 819 a month, but she refused to disclose their basic salary.

Struggling to survive

Hackson Radingwana, 58, started working for ArcelorMittal in 1990. He said his basic salary before deductions is about R13 000 a month. The father of five said many workers like him are drowning in debt as the cost of living spirals. 

“I do not want to lie to you, we are suffering from hunger because of this company. My six-month-old grandchild does not have milk and nappies,” Radingwana said. “I live in Sebokeng. My transport was R600 a month and now it’s increased to R680 a month.” 

He added that a large part of his salary goes to service loans he took out to build his 11-room house in Jane Furse, Limpopo, which took him 10 years to finish. Before completing it, he and his family had lived in a three-room house for 15 years.

Related article:

Numsa’s Sedibeng regional secretary, Kabelo Ramokhathali, said workers at ArcelorMittal have not had meaningful increases since the Covid-19 pandemic began. In 2018, he said, Numsa entered into a three-year agreement with the steel producer according to which workers would receive a 7% wage increase in 2020. But the agreement was not honoured and the workers had to embark on an unprotected strike that year to demand what was due to them. 

After this strike was resolved, instead of the workers receiving back pay dating to the beginning of the 2020 financial year, ArcelorMittal only paid 5% from November until the following financial year. Then, during the December holidays of 2020, Ramokhathali said, the company sent an email saying that it would honour the 5% increment on condition that it would only increase the workers’ salary by 2% in 2021.

“Already at that time, the 5% was in effect. We did not respond to that email because it was not necessary as we never talked about 2%. They were playing dirty games. They knew that in December we are not working when they sent that email,” he said. “They said that because we did not respond, silence means consent.” 

Meaningless offer

For not responding to the email, Ramokhathali said, the company refused to negotiate with Numsa and opted to “impose” a 2% wage increment. Workers decided to let it slide in the hope that the shortfall would be corrected in the latest wage increment. But the wage talks have reached an impasse.

“​​We are not going to compromise, because this company is not only undermining our members but also the unions. Personally, I do not think we must settle for anything less than 10%,” Ramokhathali said. 

“The employer is unreasonable. If you look at the price of food and petrol – the majority of the workers are driving cars – the price of petrol has skyrocketed. That 5% still needs to be taxed, and when taxed it will fall to roughly a 2.5% increase.”

Related article:

ArcelorMittal’s chief executive, Kobus Verster, did not specify why it would not pay a 10% wage increase, only saying the company is “concerned that unsustainable increases in base pay will lead to cost pressures, which will weaken our competitiveness”.

Numsa said the multinational company with plants all over the globe is not cash-strapped. As Africa’s largest steel producer, it supplies more than 60% of the steel used in South Africa. Globally, ArcelorMittal said last year, it had delivered “significant returns” to shareholders of about R70 billion and forecasted a favourable market outlook for 2022.

Outsourcing and safety issues

In 2008, then labour minister Membathisi Mdladlana promised that the ANC would ban labour brokers outright if the party won the 2009 national election. But the ANC never fulfilled its promise. It was left to the Constitutional Court to confirm, 10 years later, amendments to the Labour Relations Act. These stipulated that anyone working for a labour broker automatically becomes a permanent employee of the main employer after three months’ service.

However, ArcelorMittal has kept about 40% of its workforce under the employ of labour brokers Real Tree and Monyetla Services, said Numsa spokesperson Phakamile Hlubi-Majola. She pointed out that ArcelorMittal workers also went on strike in 2019 over the company’s use of labour brokers. “This is an issue that we have been fighting for a long time,” she said. 

ArcelorMittal has also been criticised over poor health and safety practices. Last year, Thami Molefe, 53, Lesenyeho Mofokeng, 32, and Mpho Madumisa, 30, died after an explosion at the Vanderbijlpark plant caused a stack structure to fall on the room in which they were working, crushing them. The company was criticised for not sending in a rescue team immediately, leaving the trio’s colleagues with no option but to start digging them out with their bare hands overnight.

Related article:

In a 2006 fire at the same plant, one worker died and two were injured. In 2013, a fire broke out again and in 2020 a gas line exploded. Two workers were also injured in an explosion at the Newcastle plant.

Elsewhere, 23 workers were killed in an ArcelorMittal coal mine in Kazakhstan in 2008 after a methane blast. There was an explosion at ArcelorMittal’s plant in Chicago in 2019, and industry media reported last year that a fire and explosion had taken place at an ArcelorMittal plant in Italy.

The IndustriALL Global Union, a federation of unions in 140 countries for workers in the mining, energy and manufacturing sectors, said that between mid-November 2020 and mid-March 2021 another four workers were killed at ArcelorMittal plants – two in Spain, one in Ukraine and one in Poland.

Following the deaths of Molefe, Mofokeng and Madumisa, IndustriALL’s Geneva head office demanded an urgent meeting with ArcelorMittal in Luxembourg. After the company ignored its request, IndustriALL said it was “outraged by the failures of ArcelorMittal’s health and safety policy and conduct”.

“Trade unions at various sites have consistently raised concerns about the lack of investment in site maintenance and health and safety at local level,” said IndustriALL, adding that in some cases the deaths of workers on site were not properly investigated.

If you want to republish this article please read our guidelines.