4 November 2017

Ethiopia: Castel Labour Suspends Strike After Pay Raise Vow

Photo: Castel Winery/Facebook
Castel Winery.

The labour strike that occurred at Castel Winery Plc, a sister company of BGI Ethiopia, bottler of St. George beer, was temporarily settled after the owners of the Company promised a 15pc - 70pc salary adjustment.

The strike broke out on October 27, 2017, in Batu Town, Oromia Regional State, 163Km south of Addis Abeba. It involved about 1,200 employees who halted work for five days demanding a salary raise, benefit packages, safety provisions, acknowledgement of the labour rights, promotion and employment arrangements and contracts.

"We have been asking the management of the Company to address these issues for the past three years, but we got no response and have not seen any changes," said one of the employees.

But 10 days ago, the workers started the strike reaching a consensus to suspend four management members of the Company. By the next morning, the guards barred these officials from entering the compound.

Yitbarek Girma, farm manager; Daniel Sertse, human resource manager; Tesfaye Jaba, technical manager and Ibrahim Mohammed, finance manager were the four officials who were banned from entering the premise.

The four officials returned with the police officers of the Wereda and attempted to enter the compound. However, the employees refused to let them in, according to an officer from the area.

The wereda administration and police interfered in the case and started adjudicating the management of the Company at the head office located in Addis Abeba and the representatives of the employees. During the negotiation, the employees raised 34 points to be considered by the management of the Company.

Making salary adjustments by raising the floor salary, giving attention to employees' safety, fulfilling necessary facilities like that of restrooms in the vineyards and arranging logistics for the employees were among the points raised during the negotiation.

Negotiators who represented the management requested the employees to proceed with their work promising that they will bring representatives from the mother company to meet them and address their issues, according to wereda officials.

The mother company of Castel Winery Plc, Groupe Castel, was founded in 1949 by nine siblings and began establishing bottling plants within a decade of its formation.

After the deliberation on last Monday, the employees fully resumed their jobs.

Last Friday, a little over 20 representatives of the employees sat down with the delegates of the company from France and discussed their concerns. The meeting was concluded with the delegate's word of honour to make the salary adjustments for the employees and to have further negotiations on the remaining issues after discussing with the owners of the Company.

The Company has been paying between 30 Br to 45 Br to daily labourers at the vineyard, 1,166 Br to 3,200 Br as a monthly salary for guards and 1,150 Br salary for janitors.

"It pays us better compared to other companies operating in the area, but we have been demanding the adjustment considering its profit and the inflationary pressure in the economy," said one of the employees.

On a daily basis, the Company's sales volume amounts to five vehicles of wine, and reaches 10 during the holiday season, according to the employees of the Company.

The second winery in Ethiopia next to Awash Winery, Castel came to Ethiopia after Prime Minister Meles Zenawi and Pierre Castel, founder and president of the Castel Group and BGI International discussed investment opportunities in Ethiopia. The owners invested over half a billion Birr to realise the Company in Ethiopia.

The Company has been cultivating a variety of grapes such as Syrah, Merlot, Cabernet Sauvignon and Chardonnay since 2009 after importing them directly from Bordeaux, France. After the six-year investment, it started wine bottling in January 2014.

The Company obtained 300ha of land in a lease agreement. The winery has a production capacity of 1.4 million bottles, brewing standard wines (Acacia brand) and premium wines (Rift valley and Cuvee prestige brands). Half of the products will be exported to major markets in China, US and Europe.

On next Thursday, November 9, 2017, Castel's officials and the representatives of the employees will deliberate on the remaining points raised by the employees.

"If things don't work out, we will carry on with our peaceful demonstrations, including strike," said an employee.

Alemtsehay Bekele, sales and marketing director of Castel Winery, did not respond to the enquiries from Fortune on the issue until the paper went to print.

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