Chinese investor remains silent
Why employees at a recycling company have been on strike for 100 days
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In the fight for a collective agreement and better working conditions, the employees of the recycling company SRW Metalfloat are on a strange, ongoing strike. The employers' side is stubbornly refusing to talk. The protest is falling on deaf ears in a complicated network of companies that stretches as far as China.
It is a fight against windmills for the 180 employees of SRW Metalfloat. The employees of the recycling company at the Espenhain site near Leipzig have been on strike for 100 days to fight for higher wages and better working conditions. Without success. Not because the negotiations are so difficult. But because there are no negotiations at all. After two unsuccessful rounds, the employers' side left the negotiating table in August. Since then, they have disappeared and remained silent. The employees are holding out and continuing to hope.
Their demands are comparatively moderate. The goal: a collective agreement with eight percent more pay, an increase in holiday and Christmas bonuses to 1,500 euros each, and a reduction in working hours from 40 to 38 hours a week. According to IG Metall, employees receive around 600 euros less per month than comparable companies in the scrap and recycling industry. Working on the assembly line with heavy metal waste is hard, argue the employee representatives. Recycling is also an important future industry. Seven million tons of scrap are processed in Espenhain every year – an important contribution to climate protection, every recycled ton of scrap prevents a fraction of the CO2 footprint that newly manufactured metal leaves in the climate balance.
The employees receive support from the scientific community: “The scrap and recycling sector is of fundamental importance for an ecologically sustainable circular economy,” says Thorsten Schulten, wage expert at the Hans Böckler Foundation. He calls it a “scandal that many employees at SRW Metalfloat earn only a little more than the statutory minimum wage with hourly wages of between 13.50 and 14.00 euros.”
SRW Metalfloat is profitable. In normal times, when work is being carried out, the Espenhain site generates 25 percent of the Scholz Group's turnover. The company also provides training, which is not a given these days. The fact alone that the company has not made any money for three months could be reason enough for the parent company Scholz Recycling to return to the negotiating table. The group has already lost around 100 million euros due to the strike. Nevertheless, the official position is that co-determination and collective agreements are not part of the corporate culture at Scholz Recycling.
China is far away
The reason that no one has done anything for 100 days is hidden somewhere in the corporate network that stretches all the way to China. SRW Metalfloat is 100 percent owned by Scholz Recycling. But from here on it gets complicated: in 2016, the Chiho Environmetal Group, based in Hong Kong, bought Scholz Recycling GmbH. The Chinese took over Scholz when the group was financially up against the wall, for a symbolic euro. According to its own statements, Chiho is the world's largest scrap recycling company. It operates more than 200 processing and shipyard operations in Asia, Europe and North America. It is also one of the largest listed companies of its kind.
The scrap giant from Hong Kong is registered in the British Cayman Islands, where Chinese companies such as Alibaba are also registered. Chiho's majority shareholder is the USUM Group, which in turn is a subsidiary of the Loncin Group. Both are Chinese. As I said, complicated. China is a long way away.
Scholz Recycling's 2023 code of conduct explicitly states that Scholz “respects the right to collective bargaining, recognizes the formation of unions and pursues an open, solution-oriented approach to employee representation,” emphasizes IG Metall Leipzig negotiator Michael Hecker to ntv.de. That doesn't change anything. According to IG Metall, things are even getting more and more dubious. In the meantime, the statements of the managing directors of Scholz Recycling and SRW Metalfloat contradict each other as to who is actually responsible for the collective bargaining dispute, they say. One is pointing the finger at the other. But there is obviously no progress. An inquiry from ntv.de to the managing director and Chinho's representative at SRW Metalfloat, Yongming Qin, remained unanswered.
“We are stunned by the drama that is being played out here,” says Hecker. “A shameful anniversary” when the The strategy is solely to rely on the employees to give in, adds IG Metall district manager Dirk Schulze. “100 days of refusal and disrespect by the employer” hardly contributes to resolving the dispute, but rather prolongs it.
Difficult given the shortage of skilled workers
In view of the acute shortage of skilled workers, the federal government is watching the general decline in collective bargaining coverage with concern, as the Federal Government's Commissioner for Eastern Europe, Carsten Schneider, told ntv.de in response to a request. “While in 2000 around 60 percent of employees worked in companies with a sectoral collective agreement, in 2022 this figure was only 41 percent.” Good wages and working conditions are not only “a question of fairness, but also of employer attractiveness,” said Schneider. However, the state is not allowed to interfere in collective bargaining; this is guaranteed by collective bargaining autonomy.
The Eastern Commissioner does not see any shortcomings at SRW Metalfloat. Metal recycling is not one of the economic sectors that are relevant to security. Apart from that, the takeover of the Scholz Group by the Chiho Environmental Group in 2016 took place before the tightening of foreign trade law, Schneider told ntv.de.
In general, the experience with Chinese takeovers is good. “SRW Metalfloat is an exception,” emphasizes Hecker. He points to the good cooperation between employers and employees at the robot manufacturer Kuka, which has been majority-owned by the Chinese Midea Group since 2016. At the time, there were major concerns about a possible sell-off of German know-how to China.
What's next for SWR Metalfloat? “We will now increase the economic pressure that our strike is causing,” he told ntv.de, “and gradually increase the political pressure on the public, suppliers and customer companies.” Refusing to talk could cause lasting damage to the reputation of companies with Chinese owners that want to operate in Germany, he warned. “State funding and contracts should only be given to companies that are bound by collective agreements, have firmly committed to location guarantees and guarantee value creation in Germany.”
