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По просьбе автора публикуем перевод на английский язык заметки “Права человека и ПАО «ArcelorMittal Кривой Рог» Украина”

This article will review the actual state of human rights in the company of PJSC ArcelorMittal Kryvyi Rih in Ukraine and, more specifically, the human right to work and decent wages.

In August 2010, the company ArcelorMittal committed itself to the public respect and promotion of human rights.
On coming to power in Ukraine in 2010, the Party of Regions led by Viktor Yanukovych, the central London office ArcelorMittal responded with an appointment of a new CEO for ArcelorMittal Kryvyi Rih Ukraine. There was an urgent need to appoint a top manager of a huge company, who would have additional qualities:
– good understanding of the rules of the “game” in a clan-oligarchic country;
– having a real understanding and experience in how to deal with corrupt authorities at different levels;
– ability of dealing with “specific” business partners.
In order to protect the interests of the company and the business, candidacy of a manager with a post-Soviet Union business background, and an experience of successful business in the conditions described above came up. Mr Rinat Starkov was chosen as a new CEO. Previous CEO of ArcelorMittal Kryvyi Rih Jean Jouet, apparently doesn’t have above mentioned qualities and doesn’t correspond to the Ukrainian reality. The matter of mentality, of the difference in ideas about social values and culture in general are the case. For instance human rights.

Metallurg Newsletter № 13 from 09.04.2010
Jean Jouet, CEO of PJSC ArcelorMittal Kryvyi Rih
We believe the employees of our company are highly commendable professionally and materially. Our task is to create conditions for their development and improvement. The employer and the employees are, above all, partners in business. Successful, highly skilled, confident in the future employee is the foundation of our success as a whole. That is what we are now working on.

As human rights are inseparable from specific people, let’s have a look at how the rights for work and decent wages of ArcelorMittal Kryvyi Rih employees are implemented.
The fact is that almost from the first days of the company’s new owner presence, there are policies that aim a significant reduce of the total number of the ArcelorMittal Kryvyi Rih workers. It should be known, that ArcelorMittal experiences significant difficulties with the question of reducing of the total number of workers at the former steel giant. Investment commitments that were accepted by the concerned parties during the purchase of the state-owned metallurgical plant “Krivorozhstal” prohibit reduction of the number of employees within five years from the moment of purchase. It was provided by Valentina Semeniuk, who was directly involved into the sales process.

It should be noticed that other Ukrainian companies solve downsizing and specifically, the dismissal of workers issues simply and efficiently, without significant public consequences and complications.

To do this in a clan-oligarchic country, there are necessary laws prescribed, and operate government agencies that are controlled by capitalists. If for some reason the courts are unable to provide the necessary dismissal of employees, the problem is solved by means of trite involvement of legalized gangs and baseball bats. ArcelorMittal does not have this kind of opportunity. It is objectionable for those who are in power, limited by investment commitments and connected to the same moves throughout the company’s image of “respecting and even fighting for human rights” company. It reminds a violation of the rights of oligarchs.

Of course, London billionaire doesn’t need 57,000 employees that were acquired during a purchase of the former metallurgical giant. For the production of amount of iron ore, pig iron, steel, rolled products, etc., which ArcelorMittal Kryvyi Rih is able to produce currently, 18 thousand of employees is sufficient amount according to the company owners. In fact, since the sale of the company about 39 000 employees have to be excluded from the company in some way. At the same time I strongly emphasize that up to date the company has not implemented any modern and complete metallurgical technology. In other words, old Soviet Union technologies of 1950-1960s are still used for production of steel and rolled products at ArcelorMittal Kryvyi Rih. But the number of people required for production is derived from contemporary ideas about the number of workers per unit of a final product. In other words forgery and substitution of assumptions, concepts and findings are obvious.

Inter alia, the author of the article is fully aware of the fact that the owner of the business should have the right to self-determine the number of workers he needs. And speaking in a simple and clear way he has the right to dump unnecessary ballast.

There is no doubt that buying ex-“Krivorzhstal” and signing the investment commitments, the billionaire Lakshmi Mittal, was planning and fully aware of a solution of one of the priorities for any capitalist – Remove unwanted people out of business.

Newsletter number 05 from Metallurg 11.02.2011
Chairman of the Board and CEO of ArcelorMittal Lakshmi Mittal.
We really want that ArcelorMittal was recognized as the best employer in the world, but your recognition is more important for us. This means that you should be confident in an oppotrtunity of your career development.

At the beginning, Narendra Chaudhary and Jean Jouet as top managers conducted a reduction of the total number of employees in a European way, i.e. the basis of their personnel policy was grounded on the principle of voluntary dismissal stimulated by material incentives – payoff of substantial by the Ukrainian standards compensations. But the principle of voluntary dismissal of employees of retirement and pre-retirement age had almost exhausted. Pensioners left the company, and the set task of bringing the total number of workers to 18,000 people (considered optimum) was not reached.

The finest hour has come for the post-Soviet leader Mr R. Starkov, who has to accelerate the completion of the task of firing more people in a cheaper way. And, of course, must sustain the image and good name of the company.

Mr Rinat Starkov started his activities in this direction from challenging in a court, and following cancelation of one very disturbing clause in the Collective Agreement between the owner and trade unions. Numerous lawyers have suddenly discovered that the Civil Code of Ukraine has more validity than any other state laws. For example more than a Trade Union Act, or of course Collective Agreement.

To be fully understood. Cancelled by a court decision the Collective Agreement clause stated that the owner was obliged to avoid unnecessary reduction of jobs and avoid decisions that may result in a laying off employees in accordance with a Clause 1, Article 40 of the Labour Code of Ukraine. The Collective Agreement also provided an indispensable participation of the trade unions in this kind of actions of the administration.

Previous CEOs fulfilled the obligations which they had signed. I hope you do not think that they signed a Collective Agreement without participation of legal services. Just the opposite. The document repeatedly was cross-checked and improved.
But the time of top managers who followed obligations that were signed by themselves has passed.

Coming to a mutual agreement with the union, signing the document willingly, and at the right time challenging it in a court. This is the strategy of Russian capitalists. Let me emphasise one more time, this clause of the Collective Agreement had a power for many years and was abided, but the sudden change of mind of administration headed by Mr General Director led to the judicial abolition of social protection of workers.

Thus, the present CEO Mr Rinat Starkov is concerned of the people dismissal more than his predecessors. Currently the original problem is solved by means of more traditional methods for Ukraine, by compulsion of employees to voluntarily resign from the company. At the same time to others and society it appears that employees are dismissed voluntarily and, of course, on their own. Again, we are talking about applying the principle of compulsion to voluntary resign (dismissal) of employees. And that is the question of human rights, their right for work and a decent salary.
It will be shown and presented thereinafter that since the spring of 2011 HR policy at ArcelorMittal Kryvyi Rih has changed significantly towards tightening. The principle of compulsion of employees to resign from the company on their own is rapidly improving.

Technology of forcing ArcelorMittal Kryvyi Rih employees to resign.

It would be noted that there has been nothing completely new invented by the management of ArcelorMittal Kryvyi Rih. Techniques and actions that aim reduction of a number of employees were perfected in Ukraine for a long time. Administration and lawyers have adapted to the realities of their real position. The policy of reduction of the number of employees is based on the so-called “optimization and reorganization of production”.
Optimization of production is a false and mythic and exists only as a paper work of administration. There is even no really existing button, which could be brought for demonstration of needlessness of an employee. I recall that the discussion of the production optimization is brought in regards to the technologies of the last century that are used at ArcelorMittal Kryvyi Rih!
There’re more complications with the reorganization of production. It is unquestionable that the amount of parasitic posts is enormous. Really enormous. Since Soviet Union times, these positions were taken by mainly relatives and friends of the administration of the company. In those days the administrative building of the company grew up to 9 floors. Previous CEO of ArcelorMittal Kryvyi Rih Jean Jouet was fully aware of what should be the actual reorganization. However since the reorganization was to be implemented by the same administration that had to be reorganised, the result was that “parasitic” only strengthened their positions, including the material state. Particularly take into account the fact that some employees relieved their positions voluntarily without any coercion.
Currently, the approach has changed dramatically. Now the percentage of employees to be dismissed is determined quite scholarly, at regular intervals. And further indestructible “parasitic” head the process of “reorganization” of production. But now the real reduction of employees comes. These people are quite able-bodied and long ago linked their life to the metallurgical plant.
In some departments the “reorganization” is carried out so frequently and regularly, that during the time between two reorganizations administration doesn’t have time to update (reprint) job descriptions, in which there’re no changes except of a new name of a department. So, the real workers of working age, since the spring of 2011, are reorganized and optimized, in other words are being prepared for dismissal. The word “dismissal” is absent in the lexicon of the administration at this stage of the production reorganization.

Particular document – the company decree № 379 from 18.03.2011g “Creating of the Department of Information Technology and Automation.”
Commentaries on the decree are as follows. Obviously the owner, in this case performs a production reorganization. Everything appears as taking real measures for improve of efficiency, productivity, safety, etc. etc. Unnecessary “ballast” is meant to be dropped.
It is clearly seen what the “ballast” is from the instruction № 29-5/674, 08.04.2011 that was issued by the company Service of Automation of Technological Processes in general, and by the creative company managers particularly for implementation of the abovementioned decree.

It is noteworthy that the name of the instruction is “On the employment of redundant workers”. The title of the document is a hypocrisy by itself – in the foreground, of course, is the concern of the people, and not the banal getting people out of the gate of the company. From this document one can read that the reorganization and specific capitalistic care are displayed in regards to 93 selected employees.

Other comments to the instruction № 29-5/674 from 08.04.2011:
1. Technical tricks. The number of dismissed employees is deliberately determined as much higher than it is required. Most dismissed employees are proposed the very same job in the same working place on the next day and with the same workload, the only thing that is changed is the name of the place where the person works. For example, a fitter from a site named “A” became a fitter for the site named “B”. This is the essence of the reorganization of the vast majority of workers. According to the administration neither type of performed work, nor workload of employees are changed. But not everyone is offered an “old-new” position or a workplace. About a quarter of “released” people are not offered any position, and their workplaces or positions are “abolished”. The workers themselves now can be called the “released”. The term is certainly not juridical but position of these workers needs to be defined in some way. It should be noticed that these workers are called in the instruction in this way – “released”.

2. The next trick is that at the time of acquaintance with the instruction regarding the “release” there is a special proposition is offered. The essence of the proposition is to stimulate the employee to resign from the company for compensation. The time frame of the proposition is limited and the decision of resignation must be made by an employee for a few days. Managers (heads of the Special Commissions) intensively put pressure on “releases” employees – leave now and for the money, because afterwards you’re going to regret for the lost opportunity. In this regard and under a pressure of the circumstances, part of the “released” employees resign from the company to obtain material rewards (material rewards become lesser every time – just according to the post-Soviet mentality of the CEO) on the terms expiring proposition.
Still, about a half of the “released” workers that were not proposed new positions do not agree to resign.

3. The third trick is that the “released” but not positioned employees stay in an undefined employment state. On one hand they have not got any jobs in a restructured division. On the other hand the abovementioned commissions offer to the “released” employees jobs or positions which they certainly will not accept – work either not according to a profession or with low wages. In order to give legitimacy to these actions there are acts compiled on the rejection of the proposed new job. Of course, people who have not accepted new positions are subjected to a repeated pressure from the administration. It should be added that the trade union of PJSC ArcelorMittal Kryvyi Rih has refused to participate in putting this kind of pressure on the company’s employees. The union has only a moral support to the workers, but nothing more.
At the beginning “released” employees receive normal wages. Know-how of the technology of coercion to resignation is the fact that “released” employees are not fired. An employee is released from a job or position, but not dismissed from the company.
It allows the administration of the company to not legally consider them as dismissed employees, or even not to inform the relevant authorities that the “released” employees do not really have jobs or positions. In fact these workers can be defined as “released, but not employed”.
Figuratively speaking – people have stuck in weightlessness.
State supervisors don’t receive any documents in regards to the “released but not employed” people, so for them there is no evidence of existence of this kind of employees. Therefore, the state doesn’t have to react to the actions of the administration of ArcelorMittal Kryvyi Rih, because the laws are not violated, and the no legal grounds for an intervention exist. A fortiori, “released, but not employed” employees are still paid their salaries.
One can be easily convinced in it after familiarization with documents, which are the responses of the state officials to Ms Podduba (a chairperson of a trade union of a department of Service of Automation of Technological Processes (SATP) at the ArcelorMittal Kryvyi Rih), which appealed to them for clarification of the case, and with hope that appropriate measures would be taken.
As an example of a masterpiece of bureaucratic “excuse” there’s an excerpt from the response of a state official to a chairperson of a trade union of a department of SATP Ms Podduba, in regards to the collective appeal of employees. The document “On review of a collective appeal” signed by the head of a State Division of Labour Relationships, Employment and Working Conditions Mr Petrenko says:
“Thus, at the time of inspection, there were no dismisses performed at SATP according to the paragraph 1 of the clause 40 of Labour Code of Ukraine. Because of absence of the fact of dismissal of employees of SATP, it is impossible to detect compliance with or violation of requirements of the clause 42 of Labour Code of Ukraine “.
Think about it – the official cannot establish compliance with or violation of the law, although there’s no fact of dismissal. Remains of rudimental conscience of the official look optimistically, nevertheless the fact of compliance with the requirements of the Labour Code he has failed to adjudicate.
This kind of crotchets and oddities is usual to the majority of responses that representatives of the state bureaucracy give. The documents “idiocies” of the authors are highlighted.

4. In the future, and up to date, “released, but not employed” workers who have not entered the new approved structure, continue to be subjected to systematic pressure from the managers, directors and lawyers on behalf of the administration side. The aim remains the same – to get prepared ”preleased, but not employed” to agree to resign from the company under the ordinary proposition, or agree to transfer to another less remunerative position or occupation.
Since July 2011 “released, but not employed” workers were subjected to a fall of wages.

P.S. At the time of this writing, it became known that the company ArcelorMittal Kryvyi Rih Ukraine released the next instruction number 1058 from 05.08.2011 “On Amendments to the organizational structure of Department of Administration of the Finance, Controlling and Information Technology.” What has already been repeatedly reorganized (last spring previously) continues to systematically be reorganized. The will be more “released, but not employed” workers. Or, if to speak properly, prepared dismissal?


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