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Alcoa CEO defends pay, work practices at joint venture in Mexico

Pittsburgh Post-Gazette
Saturday, April 20, 2002

By Jim McKay
Post-Gazette Staff Writer

Alcoa Chairman Alain Belda yesterday met with three workers from joint venture plants run by Alcoa in Mexico and denied their requests that he reinstate a few hundred workers fired after protesting working conditions.

The meeting came at the end of Alcoa's annual meeting and followed a street demonstration held outside the Westin Convention Center, Downtown, by Mexican workers and their supporters, including the United Steelworkers union.

In one case, Belda, said Alcoa Fujikura Ltd., a joint venture with Japan's Fujikura Ltd., dismissed 236 employees who allegedly ran through a plant, took over a public address system and broke some machinery in a union campaign.

"They want to be reinstated in their jobs and the Steelworkers would like them to be reinstated," Belda told reporters. "Not on my watch unless the law says that is what we have to do. We do not condone this kind of behavior."

In another case, a government sponsored union at another plant decertified six workers who had protested conditions and Alcoa was forced to dismiss them as a result, he said. "They're upset. I'm upset," he said. "They're good workers."

The Mexican workers complained that wages averaging about $10 a day were too low to meet their expenses and that living conditions in communities surrounding the plants were poor.

Belda said Alcoa pays the highest wages in the region. "It is low, yes," he said. "But that's what it is. That's the market. If they weren't working for us, they would be working for someone else for less without the same benefits, values and services."

Carlos Briones, one of the three workers who made the trip north, said he was disappointed in the response from Alcoa and was concerned that he would face retaliation from local plant management when he returns to Mexico.

Following yesterday's meeting, Alcoa's board of directors adopted a resolution formalizing the company's practice of retaining an independent accounting firm only for audit, audit-related services, and acquisition and due-diligence reviews.
Belda said the action reaffirms Alcoa's commitment to "the highest standards in financial accountability and formally restricts the auditors from performing other services for our company."

Belda told shareholders that the firm studied the practices of Alcoa and scandal-plagued Enron and concluded that Alcoa and its accountant, PricewaterhouseCoopers, follow proper accounting practices.

"That is what we expected," he said. "That is the way to assure you [that] you are investing money in a safe investment in a company that has values and lives them."


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