Chemical Industry Cuts Jobs

• 20% of the jobs in the chemical fertilizers sector are about to be cut

• Employers confirm forthcoming job cuts and technical unemployment

• Unions ready to go to court, if any legal discrepancies found

Some 2,200 employees in the chemical fertilizers sector of the chemical industry (approximately 20% of the workforce in the business) are about to be fired following the global economic and financial crisis. Because of the crisis, Romanian chemical fertilizer producers have seen a dramatic decrease in sales and increasing difficulties in securing operational financing. As some of the chemical fertilizer plants are about to be closed (i.e. are currently stockpiling production and have no sales because farmers are out of money), employers have announced job cuts as a way to maintain the factories "on life support."

Employers yesterday notified the unions about forthcoming massive layoffs throughout the sector. Of the approximately 10,000 employees in the chemical fertilizers sector, some 2,200 could lose their jobs soon, union leaders announced.

Ovidiu Popescu, Vice President of the Federation of Free Unions in the Chemical and Petrochemical Industries (FSLCP), is contesting the employers" decision on the count that it contradicts several provisions of the Labor Code. "First of all, these notifications were issued by the CEOs and through a decision of the General Meeting of Shareholders. The notifications do not include any solutions or estimations regarding the future activity of the plants after the layoffs. Normally, negotiations with the unions should have preceded the notifications, but there have been no negotiations. Moreover, they do not stipulate the criteria for the layoffs. It is possible that the people to be laid off may be selected primarily from among those who retired and were hired back," Popescu said.

Popescu also announced that a crisis committee of union and management representatives had been established to deal with the situation. According to Popescu, one solution would be to apply a provision in the employee"s labor contracts, which allows the payment of 75% of the salary for a definite period of time. In turn, management representatives said they would negotiate with the unions on Thursday. "All plants will cut jobs and/ or go into technical unemployment," said Marian Mirea, President of the Nitrofosfor Business Association.

In turn, Bogdan Hossu, President of the union confederation CNS Cartel Alfa, said that the confederation, which includes FSLCP, would go to court to contest the decision of the chemical fertilizer plants, if any discrepancy was to be found in the Labor Code. In his opinion, if the notifications mentioned by Ovidiu Popescu were indeed not aligned with the legal provisions, they were "legally null." Hossu also said that there was a need to discuss with the future Government about the ruling program before Parliament had a chance to vote on it.

"We need a trilateral agreement of the employers, the unions and the Government, before the Parliament votes on the ruling program," Hossu said. He warned that "chaos" would come about, if the Parliament passed the ruling program without a section dedicated to the chemical fertilizer industry. "We will react on any violation of the Labor Code," he reiterated.

Among the solutions proposed by Cartel Alfa to solve the problems of the chemical fertilizer industry are VAT cuts and coherent policies to ensure the stability of the price of fertilizers.