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The great Keila layoff: a bang. Then, silence

PKC Group to leave town

COMMENT PRINT ARTICLE
PHOTO: Mihkel Maripuu
PHOTO: Mihkel Maripuu

The smokers «cages» attached to the wiring systems maker PKC provided the only and lonely place, yesterday, for those painfully laid off to come talk to reporters.

«See, the press has come. Who wants to be media star,» the female smokers jest in Russian.

No volunteers. All in the cage stand with back to the camera, loyal to the company which just sacked them – en masse. They come across as instructed about the CEO Merle Montgomery alone to be the one to speak.

The employee to comment might be trade union representative – but strictly in writing having a sour throat.

At helm of the enterprise for ten years, Ms Montgomery talks long and smooth. Feels like she is using the sentences as painkillers. The more complicated the sentence, the less it hurts.

«Operating on international market, PKC Eesti must in order to stay competitive ling term to seek for production opportunities in countries with more competitive production costs and more flexible labour market options,» utters Ms Montgomery.

Thereafter, the journalist creates a scandal and the sour throated trade union representative is brought fourth. Herself employed as quality inspector, Virve Gross whispers that the drama of the situation has yet to hit home with her and the staff.

Meanwhile, Mia – a veteran worker at PKC who met a Postimees journalist in a cafe in Tallinn – says that though the layoff notices were only officially handed out yesterday, the people had bad forebodings before.

The layoffs begun last year, in November. «A writing was on the wall with 25th anniversary not celebrated at PKC,» said Mia, with 20 in the factory under her belt. «There was a bang, and there was silence. No questions asked.»

Currently, Mia sees no new options for employment for the PKC people. A large part of those sacked have sent their CVs to Glamox, a light solutions producer located in the same industrial park.

But many have come to work at PKC as families, like a mother with two children. Unlikely to walk, hand in hand, to a new job place. «I am available on the labour market now. Feels weird,» says Mia. «I do not know what I want to do. I have been making these car wires and I’d keep on making them.»

As assured by other entrepreneurs in Keila, these people better forget about making car wires and especially locally – no jobs available. They must look elsewhere.

«Harju Elekter has nothing at the moment to offer those laid off from PKC as we assemble sophisticated automatic devices for which they are not qualified,» said Harju Elekter chairman Endel Palla.

Also, the chief of AS Draka Keila Cables of over 100 of staff, Tarvo Leppik, assures us they have nothing on offer as PCK has only women on staff mainly. Draka, however, need physically strong guys.

Even so, no need for those being laid off to totally despair as in May already, PKC intends to arrange a trade fair in Keila, in cooperation with unemployment insurance fund. «PKC Eesti helps in order for all our staff to be well informed of benefits, retraining, and jobs on offer and find a suitable job quickly,» words Ms Montgomery.

Already, Harju Elekter and owner of the wiring systems plant building is getting ready to have someone in it instead. In high likelihood, PKC will move its remaining sales and development to Tallinn, nearer to airport.

«They are yet to tell us their leaving... We hope to find new tenants from Finland,» explains Mr Palla.

«Harju Elekter has a god reputation and so do PKC workers. I think it will be as in Haapsalu where, to replace PKC, we found new tenants from Finnish car industry circles. There were fewer job places, but the building remained not empty.»

Yesterday, the PKC group management in Finland announced the closure in March next year of their plant in Keila, to shift production to plants in Lithuanian and Russia. Therefore, gradually during the year the enterprise will lay off 613 people during a year.

PKC Eesti has 707 on payroll, including those at the wiring systems plant and people at European and Latin-American regional centres. Of employees, 80 percent are women. Average age is 43, and the average career length 9.5 years.

Those from Keila are largest group at 223 people. 59 come to work from the surrounding Keila Parish. 86 commute from Paldiski, 70 from Vasalemma Parish, 35 from Tallinn, 33 from Nissi Parish, 26 from Haapsalu, and 22 from Padise.

In Estonia, PKC will continue the development of European and Latin-American regional centres providing work for nearly a hundred people involved in engineering, product development, product launch, IT, finances, personnel management, sales, purchases, and procurement.

In August 2014, PKC shut down its plant in Haapsalu and laid off 350 people. That year, as shown by Estonian commercial register, PKC Eesti made almost €12m of profit at near €139m of turnover.

In the read a year before with €10.5m, parent company PKC Group made €18.3m of pre tax profit last year as announced to Helsinki stock exchange. As last year, the group this year pays €0.7 in dividends per share.

As announced by PKC to Helsinki stock exchange, it continued last year to consolidate production in Brazil and Europe. In Brazil, production was brought into one plant, in Europe production increased in new plants in Lithuania and Serbia.

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COMMENTS

Endel Palla

Chairman of Harju Elekter

I do not approve of the decision by management in Finland as they only watched one line – labour costs. They did not consider that during 25 years we have trained a whole lot of skilled and Finnish-speaking local workers. Now, they will have to do the same in Lithuanian and Russia.

I realise that the price pressure in car industry is very strong right now, but we ought rather to stand tall. Even so, during these past few years the management in Finland has made a string of jumpy decisions, jumping from one country to another, one region to another. A PKC plant in Russian Karelia, in Kostomukša, is something totally different than in Keila. Also, regarding labour costs it would have been cheaper to produce in Pskov as in Kostomukša the workers will have to be paid the so-called Northern coefficient which makes production dearer.

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Virve Gross

PKC trade union representative

The signs that things may go bad at PKC were in the air at the end of last year as the orders earlier filled in Keila were sent to the Lithuanian plant. The layoff notice was a shock, as the owners have thus far treated us very well, we have had work and have felt secure. The new situation is yet to hit home with me and my colleagues and we will have to digest it now. What we are hoping at the moment is that some other production comes here to replace PKC.

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