GWU says management is 'over-reacting'

Three ships were yesterday awaiting instructions on whether to seek alternative dockyards in the Mediterranean as industrial action at Malta Shipyards entered its second day, leaving management counting losses and trying to save Malta's reputation in the industry.

The General Workers' Union yesterday poured cold water over the management's statements, describing them as an "over-reaction" to legitimate industrial action.

Government Investments Minister Austin Gatt said on Monday he would "probably" have no choice but to declare Malta Shipyards Ltd bankrupt in a few weeks' time as a result of the GWU's actions.

And the management has decided to pull the plug on marketing, claiming the 'yards could not give a guarantee that work will be completed on time.

Asked whether he suspected the government would take the cue from the latest industrial action to eventually shut down the shipyards, GWU general secretary Tony Zarb replied: "I don't know what's behind the management and the government's reactions but God forbid if they intend to use the union as an excuse to close the shipyards".

The GWU has issued a "work to rule" directive after it clashed with management over two issues in particular: the payment of allowances to workers on an "unplanned night shift" and the engagement of subcontractors, which it objects to.

Sources close to the shipyards said the 'yard had lost Lm120,000 in one day as a result of the industrial action, though penalties could soar into millions of liri once ship owners took legal action, as some have claimed they would.

"The real long-term damage will be done as the news reaches the international press and clients shy away from Malta. And in a ship-owning community of a few people, such news travels fast," the sources added.

The GWU says the directives issued are to "work to rule". However, the sources said the situation on the ground is of general non-compliance, with workers essentially doing no work. "The shipyard is 90 per cent non-operational, which means it is at a virtual standstill," the sources said.

The shipyards are currently full of vessels, including super yachts, some of which are owned by the big players in global shipping.

The sources said that two particular clients were trying to make arrangements to shift to other Mediterranean shipyards. What kept them here was the fact that they would not be able to sail without the classification standards.

Another ship was out of port, awaiting instructions on whether to proceed to Malta, as was stipulated in its contract, or shift elsewhere.

Another two clients have complained about the situation in writing to the shipyard.

One ship owner wrote to the management warning that "the yard is fully responsible for any damages, loss of time and any costs whatsoever suffered by the vessels, owners or managers".

Superintendents of ships in the 'yard were in contact with the owners.

No meetings were held yesterday between the government, management or the unions to try and find a way out of the impasse. Dr Gatt and GWU deputy general secretary Manuel Micallef have, however, agreed to meet later this week to discuss the matter.

Mr Zarb denied that the shipyards were at a standstill and insisted that the union was merely taking action to protest against some issues which, he said, had been dragging on for some eight months.

He said the union was objecting to the fact that a number of ship owners were subcontracting when the work could easily be assigned to Maltese workers.

Mr Zarb said the problem did not lie with the minister but with the shipyards' management, which he accused of intransigence. He asked why the management had not even bothered to put into practice certain clauses on which there was agreement.

"We don't know why the management has decided to react so drastically. It's the management and not us that is keeping prospective clients away," Mr Zarb said, pointing out that industrial action was perfectly legitimate in any shipyard.

He described the shipyard workers and the unions as "responsible", evidenced by the fact that they agreed to complete work on a major liner on Saturday before embarking on industrial action.

The government had agreed to write off Lm300 million when the restructuring exercise at the 'yards was carried out in late 2003. Though losses in 2004 were some Lm1 million less than envisaged, the shipyards still lost about Lm9 million. The government is subsidising the shipyards to the tune of Lm8 million this year.