An information note on LARCO, entitled “the problem and the government’s effort for a fair solution” and “why we were led to the Special Management regime”, was issued by the Ministry of National Economy and Finance.
According to the Ministry of the Interior, LARCO was placed under Special Management at the beginning of 2020, while it had reached a financial impasse a long time ago. It had accumulated losses of several million, while he owed more than 600 million euros to third parties (suppliers, contractors, banks, insurance funds). The largest part of this debt (350 million euros) is to PPC.
It is also recalled that the Greek State has been condemned by the European Court for illegal state aid to the company. More specifically, following the decision of the EU Court of Justice of January 20, 2022 in case C-51/20 (state aid to LARCO), the Hellenic Republic was ordered to pay a lump sum of 5.5 million euros and an additional monetary penalty amounting to 4.368 million euros per half-month delay which is paid to date.
Furthermore LARCO has environmental fines of 50 million euros on its back and is responsible for serious air pollution in the wider area as well as for the burden on the Euboean Gulf, where thousands of tons of rust are deposited every year.
As pointed out in the information note, in a deeply problematic company, the average annual salary cost was close to 44,000 euros per employee in 2020, while for the highest paid (with many years of service) it exceeded 73,000 euros.
By placing LARCO under Special Management, the government proceeded, at the beginning of 2020, to reduce salary costs by 25% on average. The cuts mainly affected the old and more highly paid workers of 2,000-3,000 euros and above, while the wages of the young and the low paid remained unchanged.
After LARCO was placed under Special Management, the note adds, tenders were announced for the sale of its assets. However, investor interest was not as strong as some had imagined and the tenders faced and continue to face significant problems.
In more detail:
Tender A conducted by TAIPED on behalf of the Special Administrator regarding the lease of the factory and mineral rights of ED property received the approval of the Court of Auditors in the summer of 2023. During the same period, tender B was conducted and completed by the special administrator concerned the sale of assets (mines) owned by LARCO.
In both competitions, the same investment scheme was declared as the preferred investor.
During tender B (of the special administrator), an appeal by another participant in the tender was filed and pending before the Council of State. The government’s goal is to remove the above obstacles and to successfully complete the transfer of tender A items to the bidder.
In the event that there is a different decision of the SC for tender B, or the bidder withdraws his offer for tender A, then a new tender will be required for tender A (and possibly for B) with a significant delay in the transfer process.
In any case, even if the above obstacles are removed, it is estimated that a significant amount of time is required after the transfer until the restart of the production operation of the LARCO complex, mainly due to the large investments that will have to precede it.
From the date that LARCO was placed under Special Management (from 2020), the Ministry of the Interior reports, the employees’ payroll has been covered by the State at a cost that has so far exceeded 120 million euros. However, as the problems continued unabated and essentially the company had no production since the summer of ’22, the government then took the following decisions:
The contracts of the employees were terminated, based on Law 4941/2022 on 28/07/2022 and the employees received severance payments totaling 24 million euros from the state budget reserve.
Subsequently, during the period from 28/07/2022 to 10/04/2024 the Special Administrator entered into seven fixed-term contracts with them.
As this problematic situation continued, with no immediate prospect of reopening, the government in early April announced the end of this regime and the adoption of a system of transitional coverage for workers. Then an additional last extension was given until 12/05/2024, so that the employees who are then given the opportunity to join the DYPA employment program have a reasonable notice period.
Subsequently, with a temporary order of the competent court, until the adjudication of the injunctive measures, the workers continued to be paid until the middle of July.
A few days ago, however, the court that examined the security measures rejected the appeals of the workers’ unions against the government’s support measures, and now these measures must be implemented.
About the employee support measures, according to the briefing note, the government in March 2024, announced additional measures of transitional coverage of workers based on corresponding measures that had been taken in other enterprises (e.g. Scaramanga shipyards). Specifically, an employment program was established by DYPA in public institutions, with the following characteristics:
- The program will last up to two years for those up to 55 years old and up to seven years for those 55 and over, with a gross monthly fee of 1,210 euros gross or 1,000 euros net. Acceptance bodies include Regions, Municipalities, Health Centers, DYPA and e-EFKA, in areas as close as possible to the employees’ homes.
- The aim of the program for workers aged 55 and over is to fulfill the necessary conditions for retirement. These employees (up to 320 employees) can be employed for up to 7 years, in order to ensure their retirement with a monthly salary of 1,201 gross or 1,000 euros net (total estimated sub-programme cost of 40.4 million euros), in the following host agencies : Municipality of Aliartou, Municipality of Thebes, Municipality of Levadea, Municipality of Orchomenos, Municipality of Chalkidea, Municipality of Kymi-Aliveri, Municipality of Dirfyon-Messapia, Municipality of Mantoudi-Limni-Agia Anna, Municipality of Kastoria, Municipality of Servia-Velventou, Municipality of Lokron, Region of Central Greece, Region of Attica, Region of Western Macedonia.
- Accordingly, the aim of the program for workers under 55 years of age is their transitional coverage until they find employment through the new LARCO investor or elsewhere. These employees (up to 536 employees) can be employed for up to 2 years (12 months with the possibility of extension for another 12 months, following an application submitted by the host organization) with a monthly salary of 1,201 gross or 1,000 euros net (total estimated cost of sub-programme 19 .5 million euros), to the following recipient bodies: Ministry of Environment and Energy as well as Regional Forestry Services in the administrative boundaries of the Regions of Central Greece, Western Macedonia and Attica, thereof. Public Employment Service (D.YP.A.). Electronic Unified Social Security Agency (e-EFKA). Region of Attica, Central Greece and Western Macedonia. Administrative Services of University Departments in Lamia, Thebes, Kozani and Chalkida. Hellenic Authority for Geological and Mineral Research (E.A.G.M.E.). Ministry of Health: i. Livadia General Hospital, ii. Thebes General Hospital, iii. Chalkida General Hospital, iv. Kastoria General Hospital, v. Kameni Vourla Health Center, vi. Amfikleia Health Center, vii. Atalanti Health Center, viii. Aliartou Health Center, ix. Thebes Health Center, x. Livadia Health Center, xi. Schimatari Health Center, xii. Winery Health Center, xiii. Aliveri Health Center, xiv. Psachna Health Center, xv. Mantoudi Health Center, xvi. Argos Orestikos Health Center, xvii. Amyntaio Health Center, xviii. Serbian Health Center.
It is underlined that for these programs the DYPA has already published the public call No. 6/2024 on 11/06/2024 where the beneficiaries are invited to submit their applications, as well as the hosting bodies to declare the number of places they desire.
For the housing and health coverage of the workers, it is reported by the Ministry of Health that the government also extended the possibility of using the residences of Larymna and Agios Ioannis, until the completion of the disposal process of the assets. For this purpose, a special amendment was passed which gives the Special Administrator the possibility to use part of the state aid that has been withheld in the amount of approximately 18 million euros, in order to cover the costs related, among others, to
- the accommodation of former LARCO employees in the settlements that exist on the premises of the company,
- carrying out actions to cover health insurance policies for necessary treatments,
- the operation of the clinics on the premises of LARCO and the renewal of the employment contracts of the necessary medical and nursing staff.
Mobilization of LARCO workers at the Ministry of Energy – Strike and gathering on Wednesday at the factory gate, in Larymna
With a mobilization in Athens, at the Ministry of Energy and Environment, the workers and unions of LARCO responded to the “order to throw the workers out of the factory and the factory facilities, given at noon on Monday by the special administrator”.
The unions called for the general strike in Lokrida and the gathering at the gate of the LARCO factory in Larymna, on Wednesday 17 July at 10.30 am.
Buses for the strike gathering in Larymna will depart from Athens at 8 am, from Metaxourgeio Square.
A delegation of the LARCO Workers’ Unions met with a representative of the Ministry of Energy and Environment.
Earlier, before the meeting, in his statement o Panagiotis Politispresident of the Workers Union at LARCO, noted, among other things, that “we are here and we are asking for an end to the desperation, so that the income of the workers is guaranteed and the rehiring of the workers is guaranteed”.
Informing those gathered about the results of the meeting, Panagiotis Politis said that “at the meeting we presented all the problems faced by LARCO employees, which the representative of the ministry recorded and we are waiting for an answer, without any illusions”.
“We are”, added Mr. Politis, “in a conflict for 4 years with an anti-popular strategy”, while he underlined: “We will stay there. As of yesterday they gave up and we are on our own to protect our children from a bomb, literally. We’re in danger of an accident, new Tempe. We won’t allow it. We know LARCO, we will protect our lives. We call on them to renew the contracts here and now and to introduce a plan for the re-operation of LARCO”.
Concluding, after thanking the workers, unions and agencies of Attica who supported the workers of LARCO today, he called for mass participation in the general strike in Lokrida and in the gathering that will take place at the gate of the LARCO factory in Larymna.
“We show our solidarity to our brothers in LARCO and demand that all jobs be guaranteed, that LARCO not be closed and that the income of the workers be guaranteed, as well as that they and their families are not evicted”, pointed out Sotiris Poulikogiannis, president of the Metal Syndicate of Attica and Shipbuilding Industry of Greece.
On the side of LARCO workers were unions, institutions and workers of the private and public sector of Attica, LARCO workers from Athens, a delegation of the PAME secretariat, expressing practical solidarity and support for the just struggle of LARCO workers and their families their. Also Teachers Unions and Student Associations of Athens.
The gathering was attended by Giannis Protoulismember of the PG of the Central Committee of the KKE, as well as the members of the Central Committee and MPs of the party, Nikos Ambatielos and Christos Katsotis.
The mobilization was dominated by the slogans “Crime in LARCO must not continue, they are with profits and we with life”, “Kyriako, Staikoura, listen carefully, LARCO will not become a mantra for materials”, “Brothers of LARCO we are with you we’re fighting for your job and your life.”
Source: www.enikos.gr
