ArcelorMittal Poland strikes crisis pay accord, some facilities still open

London and Warsaw — ArcelorMittal Poland has completed negotiations with trade unions on so-called economic unemployment pay during the period of crisis caused by the COVID-19 pandemic, ArcelorMittal's head office in London said Friday. The company's Krakow blast furnace remains idle but other company facilities in the country continue to produce, according to a spokeswoman.

The company signed an agreement with Polish trade unions which is valid from May 1 until July 31, the spokeswoman said. The agreement "is a result of mutually agreed discussions. It is important to underline that the economic unemployment pay will not be lower than the minimum wage in Poland," she said.

The spokeswoman denied local reports published Friday by Poland's state news agency PAP that ArcelorMittal Poland is halting production. PAP said that the agreement struck on unemployment pay had cited a "significant worsening of the company's financial situation as a result of a reduced quantity of orders caused by the emergence of Covid-19 and the company's search for solutions aimed at protecting jobs".

The ArcelorMittal spokeswoman said that the company's production in Poland "has slowed in line with the rest of the industry in Europe."

ArcelorMittal temporarily idled its Krakow blast furnace in November 2019 due to global steel overcapacity. The company announced on March 17 that it had decided to postpone the furnace's restart – originally planned for the second half of March – due to market uncertainty resulting from the spread of COVID-19 in Europe, with several customers closing operations or reducing off-take.

Regarding ArcelorMittal's other facilities in Poland, the company is monitoring the situation and taking decisions based on market developments, according to the spokeswoman.

Under the agreement with unions, employees working from home will receive 80% of their salary, when the furlough period does not exceed 14 working days, according to company sources cited by PAP. If an employee works from home for more than 40 working days, his or her salary will be reduced to 60%, according to the sources.

ArcelorMittal Poland is the largest steel producer in the country, producing both long and flat products. It employs 11,000 people. The company's five mills produce 70% of Poland's total steel output.