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ASI and AWU urge essential classification for steel industry

  • Posted on Thursday 26th, March 2020.

Peak industry body, Australian Steel Institute (ASI), together with the Australian Workers' Union (AWU), recommend that the steel industry be classified as essential in the event that the Federal or State Governments move towards more severe lock-down scenarios to slow the spread of Covid-19.

ASI and AWU call for all Australian Governments to keep the steel industry operational.

"The Australian steel indutry is more than willing to play its part in containing Covid-19," ASI and AWU said in a joint statement.

Australian steel manufacturers have introduced a range of measures to protect their employees. Steel mills and other facilities have introduced strict entry procedures, which include screening for Covid-19 exposure and checking the temperatures of personnel; stricter than usual hygiene procedures, including heightened, more frequent, and deeper cleaning; review of facilities to ensure social distancing guidelines are strictly adhered to, including maintaining 1.5m between employees at all times and the eradication of overlapping shifts; travel bans for employees since 1 March 2020; stringent return to work protocols post-travel and where an employee feels unwell, including self-isolation; introduction of remote working arrangements for non-essential employees; heightened communications around all hygiene measures to help ensure employee, contractor and supplier compliance; and implementation of detailed procedures to manage a Covid-19 exposure case.

ASI and AWU assert there are clear reasons to keep the steel industry operational. It occupies a strategically essential role in Australia's sovereign production capabilities, particularly when there is unprecedented global uncertainty in supply chains.

"Steel is a critical input across myriad aspects of Australia’s society and economy, from residential and commercial construction, through to mining," ASI and AWU said. "All these essential downstream and related industries rely on steel to function. If one part of an industrial supply chain is closed, this will lead to the closure of other industries and companies in a domino-effect."

The steel indutry is reported to contribute $30 billion to the Australian economy annually and has more than 110,000 people directly employed  in the sector.

"For every person employed directly by the steel industry, this creates as many as six full-time jobs in related and downstream industries," ASI and AWU claim. "There are very significant technical constraints associated with closing down or winding back steel industry operations. Large, complex, capital intensive heavy manufacturing operations—particularly those involving molten materials—are simply not designed to stop and start; the continuous nature of the process necessitates prohibitively expensive chemical and engineering procedures to shut down with commensurate massive restart costs. Additionally, if skilled labour is stood down, it may not be available on restarting. A cessation of domestic steel supply would unintentionally drive importation of equivalent steel products from regions not bound by the same workplace restrictions, which would add to the economic damage and potentially cause permanent shrinkage of the local industry capability."

Closing down Australia’s blast furnaces, even temporarily, could result in a permanent closure of Australia’s steel industry, according to ASI and AWU.

"If critical elements of Australia’s steel supply chain were to go into compulsory lock-down, the entire industry may not be in a position to recommence operations for many months—possibly years—after the immediate health crisis has subsided.

"The ASI and AWU call on all Australian governments to classify the steel industry as ‘essential’ and allow the industry to remain operational."

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