The court-ordered shutdown of a mill abroad shows that labor risks in the steel industry begin even before the shutdown.
1.Unaccounted-for occupational health liabilities: Legacy materials, uncontrolled dust, noise, and heat lead to class-action lawsuits and lengthy compensation claims.
How to avoid this: Inventory hazards by area, with consistent reports, PGR, and PCMSO; document control schedules; maintain medical surveillance of formerly exposed workers; include contractors.
2. Shutdown without a labor plan: Mass layoffs require prior union intervention; compensation paid by the government for acts of authority depends on a total work stoppage and proof from the company; force majeure requires that the company did not contribute to the situation.
How to avoid it: Plan for shutdown scenarios with provisions; prioritize negotiated measures (collective vacation, time banks, suspension, reduction of working hours and wages); initiate union negotiations before any announcement; use the “act of state” as a basis for defense.
3. Service provider contracts without provisions for interruption: During shutdowns, service providers experience an abrupt loss of demand, and the contracting party is secondarily liable for unpaid amounts.
How to avoid this: Provide for notice, transition, and guarantees; identify dependent service providers and assess their financial capacity; audit compliance with labor laws.
These three points apply to power plants, manufacturing industries, distributors, and service providers in the sector, to varying degrees. Anticipating the assessment, the collective bargaining roadmap, and the contractual review is what allows for action with legal certainty when the event occurs, rather than improvising under pressure.
