ArcelorMittal Mexico, union reach agreement to end 55-day strike

ArcelorMittal has asked three levels of the Mexican government to intervene and enforce the rule of law.

Strike’s impact

In a statement, ArcelorMittal outlined “the devastating impact” the strike has had on the company, the community, and the region.

The company estimated its production loss to be 1 million metric tons (mt) of steel. That’s 800,000 mt to date, and 200,000 mt in the mill’s restart.

“The trust of suppliers and customers has been eroded, affecting the company’s reputation and operational efficiency,” it lamented, noting that it will be difficult to recover the canceled orders and business relationships damaged by the event.

Workers’ salaries are based, in part, on performance and results bonuses, the company noted, so workers should temper their expectations for next year’s profit-sharing payments, which will be based on 2024’s results.

The strike has damaged supply chains across various sectors, including construction, automotive, general manufacturing, and domestic and international distribution, ArcelorMittal said.

“It is surprising and worrisome how one union can illegally stop an entire industry,” it noted.

“It is vital that all members of our community understand the magnitude of this crisis,” ArcelorMittal stated. “The illegal strike has not only impacted ArcelorMittal, but our entire community. The stability and economic progress of Lázaro Cárdenas and the state of Michoacán are at stake.

“We must come together to restore labor peace and ensure a prosperous future for all. We request the intervention of all local and national authorities to restore legality and the rule of law by normalizing ArcelorMittal’s operations,” the company added.

‘Historic’ agreement

The union said the more than 3,000 unionized workers made “a historic achievement,” with ArcelorMittal agreeing to pay 100% of the wages lost during the 55-day-long event. Additionally, workers will receive another profit-sharing payment of 60,000 pesos (US$3,322), an 8% salary increase retroactive to May 1, and vouchers for 17,000 pesos (US$941) for social assistance.

ArcelorMittal agreed to complete an external accounting audit of its 2022 and 2023 financial records within 35 days. If the audit finds that the profit-sharing payments were insufficient, the company will have 20 working days to issue the additional payments.

The union said the steelmaker also committed to withdraw criminal complaints against workers and actions to terminate employee and union contracts.

“The miners united until the final victory,” the union declared.