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07. August 2012

TATA Steel avoids compulsory job losses at Scunthorpe steelworks

Scunthorpe Telegraph reported that TATA Steel bosses have confirmed no compulsory redundancies will be made as part of its plan to axe 1,200 jobs at its Scunthorpe site.

In May 2011, the company announced the jobs would be lost at the works as part of a GBP 130 million cost cutting exercise.

But more than a year after Dr Karl Urich Kohler, TATA Steel Europe's chief executive, announced the cuts, the final number of redundancies in Scunthorpe has been identified as 646 and all of them have been volunteers.

The remainder of the posts is being cut through retirements, transfer of employees and not replacing those who have left the business.

A TATA Steel spokesman said that "We announced in May 2011 a restructuring of our Scunthorpe based business to target high value markets and introduce greater flexibility into our costs and operations. To support the turnaround strategy, we revealed plans to invest GBP 400 million over a five year period. The decline in some of our key markets led to a proposal which put at risk 1,200 jobs in Scunthorpe and 300 in Teesside."

He added that "Since last year's announcement, we've made good progress on our turnaround strategy and our investment plans and cost reductions are on track. By working closely with our trade union colleagues, we've been able to reduce job levels without having to make compulsory redundancies."

The TATA Steel spokesman continued that "This has been achieved by a combination of employees transferring to other parts of the business, retirement and voluntary redundancy, as well as not replacing employees who have left to pursue their careers elsewhere."

Mr Sean Scorer, leader of the 1,300 members of the Community trade union in the town, said that "The past 18 months have been extremely challenging for all officials and members alike. But our focus and commitment now is to look forward, not back and continue working with the company to deliver the new business model. By doing so, we aim to achieve new investment, sustainability, job security and the continuation of steel making in Scunthorpe. The point I would like to focus on is that we have been able to deliver to date for Community members our two main pledges following the restructuring announcement in May 2011."

He added that "Firstly, to continue our tradition of no compulsory redundancies and secondly to ensure that all TATA Steel employees affected by asset closure or mothballing on the Scunthorpe works were found suitable alternative employment."

The news comes as the unions prepare to meet TATA Steel bosses next week for the fourth round of talks on the 2012 pay claim. Mr Scorer said of the talks that "There are a number of options under consideration but it would be unfair at this stage to go into details."



Source - Scunthorpe Telegraph

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