ThyssenKrupp Workers Say Won't OK New Revamp Plan

ThyssenKrupp AG labor representatives said they won't approve new plans by the German industrial conglomerate's management to restructure the company, warning of an escalation of the dispute. In a written statement, the workers' council of ThyssenKrupp said the company's management has come up with a new restructuring plan for the company which is even more comprehensive than a previous plan that foresees reducing the number of divisions to two from five, without consulting workers.
The new plan foresees that the two remaining divisions would be run more centrally than had been agreed, top labor representative Thomas Schlenz said Friday.
A ThyssenKrupp spokesman said the company won't comment on the restructuring plan until May 13 when the supervisory board is due to discuss it.
ThyssenKrupp previously said the revamp will result in annual savings of up to EUR500 million, adding half of these savings will be the result of personnel measures, including "several hundred job cuts in administration."
Press reports have suggested ThyssenKrupp may cut up to 3,000 jobs at its steel, automotive-supplier and shipbuilding businesses due to the global recession.
The workers' council and union IG Metall previously said their approval for any reorganization are conditional on the management guaranteeing it will refrain from forced redundancies and guarantee existing wage deals as well as employee participation in the company's decision making.
ThyssenKrupp's workers and management have been at odds over the issue of forced redundancies for weeks.
While workers have said they had been assured there wouldn't be any layoffs, ThyssenKrupp Chief Executive Ekkehard Schulz has repeatedly said he cannot rule out forced redundancies in the current economic environment.
IG Metall spokesman March Schlette Friday said the company's management "indicated" at a meeting Thursday that it would step back from its commitment to rule out layoffs. He added this marks an "escalation" of the dispute between workers and management.
Steelmakers are reeling from a drastic fall in steel demand as key customers in the automotive, appliance and construction industries continue to cut steel orders.
Large steelmakers around the world have responded to plummeting demand by cutting production, shelving expansion projects and reducing staffing in order to conserve cash.
ThyssenKrupp has said it will likely post a loss in the second quarter of fiscal 2009, and only post a pretax profit adjusted for non-recurring items in the year ending Sept. 30, "provided the economic situation improves in the second half of the year."