The scrap between Solidarity trade union and South African steel producer Ispat Iscor continued yesterday, with the two even failing to agree on whether the labour organisation actually served legal papers on the company.

While Solidarity maintained in a statement yesterday that it served the court paper on Ispat Iscor in a bid to have the company’s current retrenchment process declared void by the South African Labour Court, the company denied being served with any papers by the trade union.

Solidarity said it was taking legal steps after Ispat Iscor gave notice of plans to start restructuring at its Newcastle operations, in spite of an earlier announcement that there would be no forced retrenchments in the company for the next three years.

The labour organisation also argues that Ispat Iscor does not have a valid reason to retrench people and that an invalid process, leading to the retrenchments, was followed.

Earlier this week, the union slated Ispat Iscor for allegedly refusing to commit to paper an agreed three-year moratorium on retrenchments. The agreement was initially announced by the company’s chief executive, Louis van Niekerk, who assured the trade union that there would be no forced retrenchments during the agreed three-year period.

Ispat Iscor has subsequently sidestepped direct comment on Solidarity’s allegations of backing out of the deal, and has also said that it would defer detailed comment on the legal action until it had studied the full text of the union’s argument.

However, the company said there was a legally prescribed procedure in respect of retrenchments and that it had fully complied with these requirements.

Meanwhile, Solidarity claims that, should its application succeed in court, the action would be a watershed for retrenchments in South Africa and may cost Ispat-Iscor as much as R400-million in damages and reemployment.

According to the union, a legal victory would also create a precedent that would make it much more difficult for the company to retrench workers in future.

Solidarity also complained that, on the strength of Ispat Iscor’s announcement of a moratorium on retrenchments, the trade union signed a wage agreement with the company, after the steel giant refused to enter into a written agreement placing a moratorium on forced retrenchments.

“Ispat-Iscor is prepared to enter into a watered-down agreement, in terms of which the company undertakes to attempt restricting retrenchments to natural personnel turnover and voluntary packages,” commented Solidarity’s chief secretary at Ispat-Iscor, Johan Pieterse.

“This means that the company will try to find alternatives to retrenching people, but if the attempt is unsuccessful, it will carry on with retrenchments. This is exactly what the Labour Relations Act prescribes and is worlds removed from Louis van Niekerk’s announcement to trade unions of an Iscor-Ispat pledge to refrain from carrying out forced retrenchments for the next three years.

“The notice of planned restructuring in Newcastle shows that Iscor is reneging on its own pledge. We have, therefore, decided to create a precedent through litigation, since Iscor’s pledge is simply not good enough.”