Brazilian steelmaker Gerdau will lay off 70 workers at its special steel unit in the city of Pindamonhangaba in the state of Sao Paulo, the company said in a letter to a local union.
According to the Pindamonhangaba metal workers union, Gerdau has approved the temporary layoffs in a meeting this week. Employees will remain out of work for a period of five months until desired production levels resume.
“This is not ideal. The company could have done this before, but this represents a relief for the category [of metal workers],” said Herivelto Moraes, the union’s general secretary.
According to the metal workers union, Brazilian labor ministry create the layoff program, in which it pays subsidies for companies like Gerdau to not fire employees. Under the federal program, workers continue receiving pay while they wait for production levels to resume.