AAT employees return Union denies sabotage and retains demands

About 70% of the permanent employees at the AutoAlliance Thailand assembly plant in Rayong reported to work yesterday and have accepted the company's new pay and bonus terms, according to an AAT executive.

Around 1,600 workers reported to work at the Ford-Mazda joint venture, which announced a worker lockout on Tuesday, citing the failure of negotiations with the company's union on pay and bonuses and "sabotage" by staff at the plant itself.

An estimated 900 workers continued to rally yesterday outside of the Rayong plant in a fight for higher compensation.

AAT claimed in a statement that the lockout was made to "ensure the safety of its employees, customers and products" after "extraordinary acts of sabotage" had occurred at the Rayong plant over the course of the annual pay and benefits negotiations.

"The company believes the acts of sabotage are the work of a small minority of employees. One AAT employee has already been charged with a criminal offence by Rayong police and his employment at AAT terminated," AAT said in a statement. The company declined to elaborate on the alleged sabotage.

The plant's 2,200 full-time workers were given until yesterday to either report to work and accept a new employment contract or face a lockout. Employees accepting the offer would be guaranteed full pay and benefits and receive a full-year bonus later this month.

AAT has 3,400 employees in total, including 1,200 subcontracted workers who are unaffected by the union dispute.

But Somsak Yodsuk, the chairman of the AAT labour union, strongly denied any union involvement in damage at the factory.

He acknowledged that some equipment had been damaged, but insisted that union workers were not involved.

"Union workers did not do any of this. It's against the company rules, and against the law," Mr Somsak told the Bangkok Post.

"But the fact that AAT is citing damage as the reason for a lockout is also wrong. There is no reason for this, as operations ... have continued as normal."

Mr Somsak said AAT generated revenues of up to 70 billion baht per year, and that the union bonus request totalled only 233 million baht.

"It's a pittance actually, compared with the company's performance. But they don't want to pay," he said. "AAT is intent on breaking the union."

Mr Somsak acknowledged that some union members had accepted the company's new labour terms, but insisted that they were in the minority and comprised mostly back-office workers.

AAT executives said workers who declined to sign the new contract would remain AAT employees, but could face salary and allowance cuts and a suspension of bonus payments from this month.

A senior AAT executive said the company would adjust its working plans at the plant to suit the number of staff who had already reported to work to avoid disrupting the supply of vehicles to its sales operations.

AAT and the Ford-Mazda Thailand Union began negotiations over pay and bonuses last November. AAT proposed a merit-based increase of 4.5% plus a special payment of 100 baht for staff to be paid in April. But the union demanded a 5.5% salary increase with a special payment of 400 baht.

AAT is also offering a bonus equal to four months' pay plus a special payment of 10,000 baht, against union demands of a bonus of 4.6 months plus a 20,000- baht special payment.

AAT executives insisted that their latest offer was competitive, particularly considering the global auto industry's difficulties last year. Production at the AAT plant last year was 120,000 units, its lowest level since 2003.

"We are 25,000 units below our plan for 2009 and 50,000 units below the 2008 volume. Therefore a settlement above 2008 levels as demanded by the union is quite unreasonable," AAT president K. Shobuda said in a recent announcement.

Mr Shobuda added in the statement that AAT continued to investigate and report to the police those found to have damaged vehicles, who would be prosecuted to the full extent of law.

"The actions of a small number of employees that occurred at AAT during the negotiations are completely unacceptable. Not only does this damage reflect badly on AAT, it increased costs, reduced profits and lowered the settlement funds available to the company to make benefits increase," he said.