The jubilation that hundreds of steel workers experienced on Thursday when the Industrial Court granted them victory over ArcelorMittal turned to grief yesterday, after the company terminated the employment og its 700-plus work force.

The company made the announcement during a meeting with the Steel Workers Union (SWUTT). It said that after consultation with its corporate head in Luxembourg it was forced to take the decision to shut down business at its Point Lisas plant and liquidate its assets. The union said the company revealed that it was $1.3 billion in debt.

In a press statement, ArcelorMittal said that despite efforts to avoid the closure of the iron and steel facility, local and international challenges had put it under severe financial distress since the second half of 2015.

It said proposed increases in gas and electricity rates at a time of falling commodity prices had rendered production costs uncompetitive, adding that proposed increases to port rental fees, announced property taxes and business levies had further contributed to the “unsustainability” of the business.

“As an export-led business, ArcelorMittal Point Lisas has also been severely impacted by the drop in international steel prices and global overcapacity in steel production. Imports into Central America and the Caribbean—ArcelorMittal Point Lisas’ core markets for its steel products—from outside the region, principally China and Turkey, rose by almost a quarter (23 per cent) in 2015, compared with 2014.

“As a result of these factors, steel orders were extremely weak in 2015 and the company’s financial position deteriorated significantly, with net losses of US$281 million compared with US$44 million in 2014. Furthermore, the company has been recording net losses since 2009,” the release stated.

Plant operations were shut down on November 23, 2015, and 480 workers were laid off for six weeks. Workers returned to duty for two weeks but were again laid off in February for another six weeks. This included 18 more workers from the accounts department.

Director Jefferson de Paula admitted that the decision was a painful one.

“Today is a very difficult day for ArcelorMittal Point Lisas, all its employees and the community in which we operate,” de Paula said.

“Despite working extremely hard over recent months to find a way to keep the iron and steel plant open, including a proposal to transfer ownership to the Government of T&T, maintain employment and return it to profitability, we have unfortunately not been able to reach a solution...

“I know this is very bad news for all ArcelorMittal Point Lisas’ employees and their families and we recognise that they will be looking to us for support.”

One month’s salary for workers

In a news conference at the George Camps Complex in California yesterday, SWUTT president Christopher Henry said workers were fired and told they would receive only one month’s salary.

Those who have unused vacation would be paid for it, but he said the company gave no indication when these payments would be made, adding there will also be no severance packages.

“You would remember that just yesterday we had a victory in the Industrial Court against this company in terms of the illegal industrial action taken by the company against our members in laying them off. That joy was short-lived by the information we received at this meeting,” he said.

“We are talking about workers with 30 to 35 years’ service, we are talking about workers who gave their lives to this multi-national company.”

The company said employees would be paid what they were legally entitled to and, in recognition of the impact of the terminations, the ArcelorMittal Group is considering whether workers could benefit from the liquidation proceeds that the group is entitled to as a creditor.

He said when questioned about the company’s pension and savings plan that workers contributed three per cent to, managing director Robert Bellisle had no answer and requested the union send him a formal query.

The ripple effect of ArcelorMittal’s shutdown also led to the shutdown of Central Trinidad Steel Ltd (Centrin) and dismissal of over 200 workers. Centrin depended on ArcelorMittal’s direct reduced iron (DRI) billets to make its products.

Yesterday, Henry said he feared that Tube City IMS, a company that provides stevedoring services to ArcelorMittal’s port, would also permanently lay off their 200 workers.

Going further, he said T&TEC, WASA and the National Gas Company, which are major providers to the steel plant, would lose millions of dollars with the closure of ArcelorMittal. With T&T’s economy contracting, he said, this could lead to further unemployment in those state companies with their profit margins expected to drop. He estimated that 20,000 people would be affected.