Workers at German steelmaker ThyssenKrupp have voted in favor of a labor agreement that will safeguard jobs and plants in the wake of a proposed joint venture with India's Tata Steel.
A vote among ThyssenKrupp's 20,500 steelworkers saw 92.2 percent of them accept an agreement — struck just before Christmas — which foresees no forced layoffs or major site closures until September 30, 2026, Germany's metalworkers' union IG Metall announced on Monday.
In September, ThyssenKrupp and India's Tata Steel unveiled plans to merge their European steel operations and forge Europe's second-largest steel group after ArcelorMittal, a move which has led to fears over significant job cuts.
The two companies said the deal would help them to tackle overcapacity in Europe's steel market, which faces cheap imports — mainly from China — subdued construction demand and inefficient legacy plants. They have already announced 4,000 job cuts as part of the tie-up, with 2,000 steelworkers planned to be made redundant in Germany.
The joint venture, in which both companies hold 50 percent, is expected to create savings of €400 million ($497 million) to €600 million annually.
Although not essential to the creation of the planned joint venture, the workers' acceptance of the labor agreement is seen as key to getting the deal done, which has been more than one and a half years in the making and shows ThyssenKrupp's commitment to seek workers' consent for far-reaching structural changes.
The joint venture still needs to be approved by ThyssenKrupp's supervisory board and chairman Ulrich Lehner could in theory use his casting vote to get the deal through should all labor representatives be against it.
uhe/aos (Reuters, dpa)