Brazilian integrated steelmaker Gerdau will provisionally furlough an undisclosed number of workers at its Pindamonhangaba mill for a third time, following an agreement with the employees and a local union, SteelOrbis has learned.
According to local union Sindmetp, 90 percent of the Pindamonhangaba workers allowed Gerdau to provisionally furlough its workforce as a way to prevent dismissals.
Neither Gerdau nor Sindmetp disclosed how many employees would be affected and for how long. However, all parties agreed that Gerdau might still dismiss its workforce within two to five months.
Employees will continue receiving their wages while completing online courses. The Brazilian government is expected to pay a portion of the salaries through existing unemployment insurance funds, while Gerdau will pay another undisclosed amount.
The Pindamonhangaba EAF mini-mill has a 620,000 mt/year crude steel capacity, producing steel bars, wires, wire rod, finished and rolled bar, as well as rolling mill roll products.
Earlier this year, Gerdau said in a document filing it was planning a BRL 532 million ($97.3 million) investment at its Pindamonhangaba site to expand capacity by 400,000 mt/year for special quality bars.