Steel merger: Tata unions still 'unconvinced'

Image caption, The unions' advisors are concerned about the proposed sale of Cogent, which includes a plant in Newport

Unions at Tata remain "unconvinced" that the proposed partnership with Thyssenkrupp would be in the "best interests" of the firm or its workers.

They raised concerns about the "unwillingness of Thyssenkrupp to engage" with them.

The unions' advisors also proposed a rethink of the decision to sell Tata's Cogent electrical steel business, which includes a plant in Newport.

Tata said it was committed to avoiding compulsory redundancies.

The Cogent electrical steel plant in Newport, which employs 350 people, was put up for sale last month.

Almost 7,000 workers are employed by Tata in Wales, including about 4,000 in Port Talbot.

The unions' Tata Steel European Works Council (EWC) are considering a number of recommendations put forward by their advisors Syndex.

These included the proposal that more support from the EWC for the joint venture should be conditional on a ban on job cuts until 2022, and an agreement that there should be no Tata Steel site closures before 2026.

Shareholder dividends

They advised that unions oppose the current business plan which, it said, "prioritises shareholder dividends over the long-term development" of the joint venture.

However they do accept that the concept of a joint venture between the two companies could benefit Tata Steel Europe in the long-term.

A Tata Steel spokesman said it welcomed the EWC's recognition of the industrial rationale for the proposed joint venture with Thyssenkrupp.

He said: "We believe in the business plan for the proposed joint venture and we are committed to delivering the joint venture without the need for compulsory redundancies.

"Meanwhile, we will continue to share information with the European Works Council about the recent announcement to sell the Cogent electrical steels business as part of our strategy to strengthen our focus on our strategic strip products and markets.

"We will continue to engage in constructive dialogue with our employee representatives throughout the process of creating the proposed joint venture."

Thyssenkrup declined to comment.