65 smelter jobs to be axed
Resize plans brought forwardCOLLETTE DEVLIN
The cash-strapped Tiwai Point aluminium smelter will lay off about 65 staff during the next two months.
New Zealand Aluminium Smelters management said operations were being streamlined to help return the smelter to viability in increasingly difficult economic conditions.
Last month management admitted the smelter was in a difficult financial situation and said no stone would be left unturned as part of a plan to maximise revenue.
NZAS had planned to shed 100 jobs during a five-year period through natural attrition, 35 of which have already gone.
However, staff were told yesterday plans to resize the business had been brought forward.
NZAS general manager Ryan Cavanagh said the organisational restructure would be completed by the end of November.
"We are hurting and losing money and we have to turn this around along with . . . other actions to secure the long-term viability of the smelter," he said.
Staff consultation over the potential restructure had started. Options included voluntary redundancies, redeployment to other roles and forced redundancies if required, Mr Cavanagh said.
There were no plans to reduce production, he said.
"It's disappointing to lose workers but I am focused on securing the long-term future of the smelter and the 700 workers who will remain here after this," he said.
He said jobs in all areas at the plant would be looked at.
Staff had taken the news professionally, he said.
Last month union officials said they were worried about smelter staff because they did not have redundancy provisions in their employment agreements.
Mr Cavanagh said yesterday a fair redundancy compensation had been introduced but would not say how much was being offered.
However, a document circulated to staff yesterday says employees would receive two weeks' salary for every full year of service up to a maximum of 52 weeks. The contractual notice of four weeks would also apply, as well as other entitlements such as annual leave, long-service leave and alternate days.
Employees could express interest in voluntary redundancy between October 22 and November 4, the document says.
Engineering, Printing and Manufacturing Union Southland organiser Trevor Hobbs said some workers were resentful because no redundancy had been proposed until now and what was being offered was half what workers at Tomago, a Rio Tinto smelter in Australia, were offered.
Some workers were likely to jump at redundancy but for most it was concerning, he said.
Mr Hobbs was concerned the Government had taken a hands-off approach with Tiwai.
"This is not acceptable, it has to get involved to ensure the guts are not ripped out of the heartland of New Zealand," he said.
EPMU director of organising Alan Clarence said the jobs cuts could be the tip of the iceberg, as NZAS continued to threaten to close the smelter unless it could negotiate a better deal with its power supplier, Meridian.
"Unless the Government acts now there's a good chance the whole place will close, and with the smelter goes the Invercargill economy," he said.
Mr Cavanagh said the smelter was talking with Meridian and suppliers, who had been informed of the situation.
Southland Chamber of Commerce chief executive Richard Hay said the news was a shock for suppliers and it was natural they felt nervous. A substantial number of jobs were indirectly linked to the smelter, Mr Hay said.
"There are many downstream businesses in the region that are major clients of the smelter and rely on it, from cleaning to catering to administration and engineering," he said.
AT A GLANCE
In 2011, NZAS made $391 million in payments to New Zealand suppliers, including $51m to suppliers in Southland, and contributed $525m to the Southland economy (9 per cent of Southland's GDP).
- © Fairfax NZ News
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