Workers at the bankrupt Liberty Steel plant in Dudelange face uncertainty before the holidays, as they may receive part of their salary but will have to do without end-of-year bonuses.
At the end of November, almost two years after it ceased production, Dudelange-based Liberty Steel filed for bankruptcy with the Commercial Court.
The steel company still employed 150 people. However, they have not been able to work for the past two years, as the site has been shut down. Their presence at the plant was therefore organised around maintenance of the installations, in the hope of the arrival of a buyer. Trade unions had repeatedly raised concern about Liberty Steel's financial difficulties, with several delays in wage payments in recent months.
Minister of Labour Georges Mischo said on Thursday morning at the end of a joint meeting of the parliamentary Labour and Economy Committees that the case must be approached with caution. Minister Mischo stated that those affected by the bankruptcy of Liberty Steel should not be given false hope, noting that each employee must file an individual statement of claim with the court.
In the meantime, the National Employment Agency (ADEM) will also intervene and pay the salary for the month of bankruptcy and the following month, as well as compensation equivalent to 50% of the notice period in the event of redundancy. ADEM advances are capped at six times the minimum social wage.
Mischo has stated that there will be no 13th month or end-of-year bonus, but that management will ensure that employees receive their entitlements promptly.
On Friday, two meetings are scheduled at the ADEM branch in Belval to inform employees offer professional reorientation to those that wish to do so, the Minister added.
Misch and Minister of the Economy Lex Delles also said on Thursday that they hoped the administrator would find a buyer for the plant. The former owner of Liberty Steel, Sanjeev Gupta, has reportedly blocked potential takeovers in recent years, lamented former Economy Minister Franz Fayot. The former minister, who is now an MP for the Luxembourg Socialist Workers' Party (LSAP), said that he had reported the fraud to the public prosecutor's office when he was still a minister. His successor, Lex Delles, stated that there had been no new developments since.
Covid-19 loans for Liberty Steel
Upon enquiry, the Ministry of Finance confirmed to our colleagues from RTL.lu that the Luxembourg still acts as guarantor for €11 million in Covid-19 loans extended to Liberty Steel Dudelange. Liberty Liège Dudelange, the official name of the company, was declared bankrupt last Friday.
In 2020, the company received Covid-19 loans totalling €17 million, 85% of which are guaranteed by the state. About €13 million of that amount has not yet been repaid to the banks, according to the Ministry of Finance. Before the banks that granted the loan can claim on the state guarantees, however, they must follow standard procedures and attempt to recover their money from the receiver. The state guarantees only become due if this approach fails, the Ministry of Finance stated.
