Miners draw attention to their plight as company managers debate cost-cutting measures

Hundreds of angry miners took to the streets of Ostrava on Tuesday to protest against planned wage cuts and growing job insecurity in the region. After a year of negotiations employers and trade union representatives are nowhere near reaching a deal on the 2014 to 2018 collective agreement, and there is a growing fear of layoffs in a region that already has over 100,000 unemployed.

Photo: archive of OKD

Hundreds of miners descended on Ostrava on Tuesday afternoon, among them nine busloads from the nearby Paskov mine which is now threatened with closure, but also from Mostecká uhelná and Sokolovská Uhelná. Fear of job losses in the mining industry is rampant and there have been rumblings of discontent over the possibility of significant wage cuts.

The mining company OKD, the biggest employer in the region, has run into serious problems and is pushing for 20 percent wage cuts as well as the possibility of closing down some of its operations. The possible closure of the Paskov mine which is currently being debated in Amsterdam with OKD’s parent company, the coal mining firm New World Resources, owned by business tycoon Zdenek Bakala would have a severe impact on unemployment in the region, leaving some 2,500 miners and another one thousand people in professions dependent on them out of work.

New World Resources has posted a steep drop in profits this year losing over 400 million euro, partly due to the falling prices of coking coal and partly due to massive investments into new technology in 2011 when the floods in Australia sent the price of coal up and the company was making huge profits. Miners from OKD claim NWR is to blame for the present situation and should not cut jobs and wages to make up for bad managerial decisions. New World Resources counters that it is only responding to the present economic situation. OKD head Jan Fabian:

Jan Fabian, photo: archive of OKD

“Some mining companies which failed to predict this situation are no longer around. We are still here and still providing jobs for 13,000 people in the region. Right now we are taking measures to stabilize the situation.”

While the company claims that bonuses, contributions to social and health insurance and a 13th wage cannot be taken for granted and giving them up is a small price to pay at a time of growing problems in the coal mining sector, miners argue that these advantages have long been a part of their basic salary and a twenty percent cut is unacceptable following years of steep profits for the company. OKD spokesman Marek Síbrt says the negotiations in Amsterdam should reveal more with regard to the company’s future direction.

“The executive management will be debating the ongoing restructuring of the OKD mining company, the implementation of cost-cutting measures with which we aim to save 100 million euro this year in order to stabilize the company and, of course, we are expecting a decision on the future of the Paskov mine. “

Photo: archive of OKD

Trade union leaders have opted to voice their discontent ahead of that decision and they are not ruling out strike action in the event of bad news. In the meantime a mediator from the Labour Ministry will try to break the deadlock in talks on a collective agreement for the next four years. And the government is to meet this week to debate an emergency plan in aid of the Ostrava region,where not just the coal mining, but the steel making industry face severe problems. The proposals put forward include a cut in electricity prices for big industrial firms and even the possibility of buying the Paskov mine which NWR finds too costly to operate.