500 jobs at British Steel face the axe with sale to new Chinese owners imminent

As many as 500 jobs could go at British Steel
As many as 500 jobs could go at British Steel
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Unions say up to 500 jobs could go as British Steel goes into new Chinese ownership.

A joint statement from the Community, Unite and GMB trade unions backs the proposed takeover but expressed concern over plans to cut the overall headcount by as many as 500 jobs.

Aerial view of Scunthorpe's steelworks Picture: Airborne Inspections Ltd / SWNS

Aerial view of Scunthorpe's steelworks Picture: Airborne Inspections Ltd / SWNS

It comes days after Liberty Steel blamed “challenging” market conditions and a lingering reduction of demand for its products in announcing up to 250 job cuts at its Stocksbridge plant, part of a nationwide plan to make 355 personnel redundant across the country.

Unions have been thrashing out employee pay, terms and conditions with Jingye over the past 10 days.

They say they have seen detail of Jingye's £1.2bn investment plan and believe this would "transform" the business.

Jingye will be the Scunthorpe plant’s third owner in nearly four years.

The statement said: "These discussions have been extremely challenging but with British Steel in liquidation it is clear that if the business is to survive change is required.

"As was widely expected, Jingye also intend to reduce overall headcount. This could be by up to 500 jobs, though significant numbers have recently left the business, and will be subject to ongoing detailed discussion at departmental level.

"This is not something that the unions could endorse and we have made the argument that the business needs to ensure the plant can be run efficiently and safely."

They said they believed they had secured a "broadly positive outcome" on ensuring changes do not disproportionately affect employees differently, protecting shift premia and avoiding reductions in regular take home pay.

Insolvency experts have warned that if the Jingye deal is not completed, British Steel would be broken up and sold in parts.

The 37th biggest steel company in the world, Jingye is the 19th largest in China, according to the World Steel Association’s list of top steelmakers in 2018, producing over 11m tonnes of steel.

Paul McBean, multi-union committee chairman at British Steel's Scunthorpe site told local radio that the plant would have closed unless agreement was reached.

Alasdair McDiarmid, Operations Director for Community, said: “We used the opportunity to shape Jingye’s proposals in the best interests of our members. Faced with challenging circumstances we believe that the dialogue between Jingye and the unions has produced a better deal for employees than what was otherwise on the table.

"We look forward to working with everyone to securing the future of British Steel under Jingye’s ownership.”