Ayrat Safin: “In the current conditions, it is better to shrink for a short time than to lay off”
Nizhnekamskneftekhim's director general on the transition to a four-day working week and a decrease in demand for products
The world economy is predicted hard times because of the coronavirus pandemic, it can lose more than $5 trillion in two years, which is comparable to the annual output of Japan. All Russian industries have found themselves in a difficult financial situation. There is being complete uncertainty in the markets, global logistics chains have been disrupted, and many automobile and tyre factories have been suspended. The economic crisis has also hit the large city-forming enterprise such as Nizhnekamskneftekhim. The company is already recording a decrease in demand for products. Ayrat Safin, the director general of the company, told Realnoe Vremya in detail about the impact of the pandemic on the company's work and the anti-crisis measures taken.
“We are seeing a clear trend of falling prices and demand”
Ayrat Foatovich, in which segment has Nizhnekamskneftekhim felt the reduction in demand for its products most keenly?
We are closely monitoring the situation. If in my previous interview I said that 90 tyre factories were suspended, now this number has increased. To date, more than 128 tyre factories in the world are already idling, the rest are operating at reduced loads. All this has led to a decrease in demand for synthetic rubber in 2020. In addition to rubbers, other types of petrochemical products are also under threat of decreasing demand. We are seeing a clear trend of falling prices and demand for plastics and raw materials for their production. In Russia, this is not yet so noticeable, but we understand that it is only a matter of time.
Our company has felt the reduction in demand most keenly in the segment of synthetic rubbers. The shipments of rubbers to tyre companies that have reduced their production have been suspended. The disrupted logistics has led to overstocking of the company's warehouses. In this regard, Nizhnekamskneftekhim PJSC has taken all necessary measures. We have already moved the annual overhaul of synthetic rubber plants to April-May to reduce supply during a period of low demand. In addition to this, we are working on the organization of buffer warehouses in Russia and Europe. But the situation is being very complicated.
“Nizhnekamskneftekhim has substantial experience of overcoming global economic crisis”
What anti-crisis measures is the management of Nizhnekamskneftekhim planning to introduce in order to preserve its production potential?
Currently, negotiations are underway with consumers of products of Nizhnekamskneftekhim PJSC, the volume of supplies and prices for products are being agreed. The main task for the company at the moment is to agree on prices and maintain the volume of supplies that allow it to load the existing capacity, retain qualified personnel, avoid layoffs, which will help to relieve social tension not only at the enterprise but also in the city, as well as ensure the payment of wages to employees.
Nizhnekamskneftekhim has a strong experience of overcoming the global economic crisis that occurred in 2008-2009. During that period, the productions, which products were not in demand, and because of which they were working unprofitably, were stopped for cold downtime, and their employees were sent on administrative leave.
The current economic situation, according to many experts, is much more complicated. If in 2008 the crisis mainly affected the banking sector, which was successfully “flooded” with money, in today's situation, it is the real sector of the economy that has suffered. The consequences of this crisis are much more serious and extensive.
The long-simmering crisis has been aggravated by the spread of coronavirus, which is rapidly affecting the regions in our country. And many large industrial enterprises, in order not to reduce the staff and save valuable personnel, have decided to reduce the working week. Sibur has switched to a four-day working week, it employs about 23,000 people. This is how the company hopes to reduce possible losses. The corporation is also reviewing a number of projects and reducing the cost of contractors' services. Russian Railways PJSC has taken similar measures, which employs more than 700,000 employees. Since March, the traffic volume of Russian Railways has decreased, and the economic downturn was observed throughout the first quarter of 2020. And CEO Oleg Belozerov went for such a measure as an alternative to reducing the staff.
Temporary transition to a part-time working week
Is it right that for Nizhnekamskneftekhim, as for other large Russian companies, the best option is to reduce the working week?
Indeed, in these conditions, it is better to shrink for a short time than to lay off. The company's management, in the absence of sales of products and, as a result, a decrease in production utilization, is reviewing the schemes for loading production capacity, including the periods of major repairs, as I've mentioned earlier, with the possibility of carrying out these repairs mainly on their own, possibly for a longer period, without involving contractors. All these efforts are aimed at stabilizing the company's economy and preventing staff reduction or production shutdowns.
We see the option of retaining all the company's jobs with an agreement with the staff on a temporary transition to a part-time working week, while retaining all the guarantees established by the Labour Code, as the most appropriate for today's realities. Corresponding order was signed on April 30 to notify employees 2 months in advance of the introduction of a part-time working regime for full-time employees starting from July 6. But if the financial and economic situation changes over this time, then its action will be cancelled.
In the fight against coronavirus, Nizhnekamskneftekhim is sewing masks and disinfecting streets
How effective are the measures taken to prevent the spread of coronavirus in Nizhnekamskneftekhim? Are there any cases among the company's employees?
We are taking all recommended measures to prevent the spread of the coronavirus. President of the Republic of Tatarstan Rustam Minnikhanov got acquainted with them on the spot during a visit to our company on April 17.
This is a whole range of activities. They begin with the disinfection of buses, passageways, road surfaces and bus shelters, and workplaces. Non-contact temperature measurement is performed. To do this, thermal imagers have been installed at the entrance gates, which signal to the inspectors about an employee who comes to work with fever, and in this case, he or she is sent to a polyclinic.
All employees were provided with masks and antiseptics. The shift bus route time table is regulated. We have also increased the number of shift buses to reduce the concentration of people in transport. The company has an operational headquarters that is monitoring the current epidemiological situation at the production facilities on a daily basis. The effectiveness of the measures taken is obvious. To date, there are no cases among the working staff.
New cases of coronavirus infection are being registered in Nizhnekamsk. However, pharmacies do not have medical masks, and there is a shortage of hand antiseptics. What measures is Nizhnekamskneftekhim taking in the current situation? How is it providing its employees with protective equipment?
We can fight the coronavirus only by joining forces. Nizhnekamskneftekhim has developed its own antiseptic, and we will soon start producing it commercially. The experimental batch of antimicrobial disinfectant for the treatment of surfaces of premises and vehicles, as well as for the treatment of hands, has proven its effectiveness and meets the recommendations of the World Health Organization. A sample of the antiseptic hsa been sent for testing to the Rospotrebnadzor Research Institute of Disinfection in Moscow to confirm its safety and effectiveness. After receiving a positive examination and state registration with the Federal Agency of Rospotrebnadzor, Nizhnekamskneftekhim will begin the industrial production of disinfectants.
Nizhnekamskneftekhim contributes to the production of medical masks. The company has purchased an automated line for the production of disposable medical masks. Their production started on April 12. We are providing these products to our employees, employees of TAIF Group, as well as medical workers of the Republican Clinical Hospital and other medical institutions of the republic.
Besides, the company has organised the sewing of masks using its own forces. Non-woven polypropylene material for more than 250,000 masks, which is produced by Polymatiz JSC, has been distributed to the main plants of the enterprise, and our employees supported the call for the production of masks at home. They are distributed to volunteers, veterans, employees of medical institutions, transport companies, performing the social mission and contacting a large number of people.
The company has allocated non-woven material to the city for sewing 125,000 medical masks, and to the Kamsko-Polyansky neurological dispensary — for making 5,000 masks.
To prevent the spread of coronaviru, the streets and bus shelters in Nizhnekamsk are being disinfected through the forced of by Nizhnekamskneftekhim. In the evening, when everyone rests, the city is sanitized from 11 p.m.
In the context of the epidemic, what assistance does Nizhnekamskneftekhim provide to veterans of production, low-income and large families?
If we are talking about supporting our employees, during the period of special self-isolation regime, Nizhnekamskneftekhim and the Trade Union Organization are implementing measures to provide timely assistance to veterans of the Great Patriotic War and home front workers who are registered in the Council of War and Labour Veterans of the company.
Initiative groups from among the representatives of the Trade Union Committee and volunteers-petrochemists provided food packages for more than 900 people, participants of the Great Patriotic War, home front workers, disabled people of the first and second groups.
Assistance has been provided to large families of petrochemists with more than four children. They were given tablets that give them the opportunity to study remotely at home. Valuable gifts and monetary rewards in honour of the 75th anniversary of Victory in the Great Patriotic War will be given to our dear veterans and home front workers. We will visit all of them on May 6 and 7 in compliance with all preventive measures to prevent coronavirus infection from spreading and congratulate them on the upcoming 75th day of the Great Victory.
The festive celebrations in the context of the coronavirus pandemic have been postponed, but as soon as the situation stabilizes, we will all celebrate this great day together.
“We all need to come together and be one team”
In connection with the difficult current economic situation, are wage reductions possible for employees of Nizhnekamskneftekhim, will all social guarantees prescribed in the collective agreement be preserved?
Nizhnekamskneftekhim is a socially oriented enterprise, as evidenced by the benefits and guarantees that the company has provided to its employees throughout all the years of its operation. We continue to maintain the tradition and always turn our face to our employees and do not plan to review guarantees and benefits. Of course, if the situation develops at an uncontrolled pace and there is a risk of shutdown of all production facilities, we will probably return to discussing this issue.
Today, this issue is out of question, and there are no plans to reduce social benefits and guarantees. The management of Nizhnekamskneftekhim PJSC has always paid great attention to the issue of timely payment of salaries. There has never been a delay in payments. Wages are the only source of income for all employees of our company. Therefore, this issue is one of the top priorities and important for us, along with payment for raw materials, taxes, and energy resources. We do everything possible to ensure that the salary is paid on time.
How long do you think the current situation in the country can last?
There are different forecasts. It is quite difficult to predict how the economic situation associated with the coronavirus pandemic will develop in the world and in the country in the future, but let's hope for the best. Today, every employee of the company should understand the situation. During this difficult period, we should all unite and be one team. Yes, it will be difficult, but only by joining forces will we can overcome this crisis period and deal with all the problems with honour.