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Some lessons from TCL’s 2012 strike

Published: 
Sunday, January 8, 2017

As I follow the news about the industrial relations impasse between the Oilfields Workers Trade Union (OWTU) and Petrotrin, I remember the impasse between the OWTU and Trinidad Cement Limited (TCL) in 2012.

By January 2012, TCL had recorded two years of losses (2010 and 2011) and had approached its lenders for debt restructuring due to the devastating effects of the great recession on regional cement markets.

TCL’s Management also met with stakeholders across the region explaining the delicate financial state of the group and appealed for support and understanding. All responded positively, especially the trade unions in Barbados, Jamaica, and Guyana, but the OWTU refused, demanding a double-digit wage increase, which would have resulted in 25 per cent increase in overall compensation.

Just like the current government, TCL’s board and management could not agree to such an increase, while TCL was negotiating with its lenders for debt relief. It is also important to note that TCL was not offering 0-0-0 per cent, but had 6.5 per cent on the table as a final settlement.

At the end of February 2012, the OWTU issued a strike notice and vowed that the strike would go for 90 days (a statement that they lived to regret). TCL’s Management had a strike plan, which it rolled out once the strike started. On several occasions meetings were held with the Minister of Labour in an effort to have the matter referred to the Industrial Court (IC), but to no avail.

As part of its strike plan, TCL had stockpiled two weeks supply of cement in warehouses across the country. Thereafter TCL slowly restarted sections of the plant with loyal employees beginning with the cement mill and packing plant. TCL then utilized spare capacity at its plants in Barbados and Jamaica to supply Trinidad & Tobago and when they were maxed out, imported cement from Cemex’s Caribbean plants.

While there were severe disruptions in the first month of the strike, the local market settled down due to imports from other group companies, Cemex’s supplies, and from the partially operational plant. Eventually TCL flew in foreign kiln operators and restarted both kilns, so that by the end of the strike the plant was fully operational.

We estimated that TCL employees lost over $20 million in compensation over the 92 days of the strike – never to be recovered. The OWTU promised to help employees but nothing materialised, as the OWTU has no strike fund. Employees had their cars, furniture, and appliances (on hire-purchase) seized and some nearly lost their homes (mortgage default). On the 92nd Day, the OWTU accepted defeat and requested that the Minister refer the Dispute to the Industrial Court bringing the Strike to an end.

The 92-Day strike at TCL was the first time that the OWTU “lost” a strike under the leadership of Mr. Roget, as TCL refused to capitulate (IOCL is the next one).

The OWTU got their “revenge” by supporting Cemex’s takeover of TCL in 2014 and insisted that the Espinet-led Board fire those executives who led TCL through the strike and reinstate the few “bad-egg” employees who were fired for misconduct.

The Industrial Court ignored TCL’s “inability to pay” argument and awarded a 9 per cent increase. When you reflect on the bigger picture, the OWTU put Trinidad & Tobago, the construction sector, TCL employees, and the company through 92 days of Hell for a 2.5 per cent increase (9 per cent IC Award — 6.5 per cent TCL settlement offer). If TCL did not have strong management and many dedicated employees it would have gone into receivership in 2012. After the strike, and until the Espinet-led board/Cemex took over—TCL was the best performing subsidiary contributing significantly to the Group’s return to profitability in 2013.

Lessons learned: TCL survived the strike because it had a credible strike plan; workers paid the highest price for the OWTU’s action; the minister did not have to intervene (Sec: 65 IRA) because the market was satisfied; and TCL emerged as a stronger company after the strike.

Rollin Bertrand, PhD, DBA

Former TCL Group CEO