Alcoa Corporation halts curtailment plans for its San Ciprián aluminium smelter in Spain

Alcoa Corporation will stop its curtailment plans for its San Ciprián aluminium smelter in Spain while after High Court of Justice of Galicia declared the collective dismissal process “null and void.”

In October, the company announced it will cut the smelter’s 228,000 tons of annual capacity and proceed with the collective dismissal of employees after completing four months of consultations. The workers’ representatives filed a lawsuit with the Court, which ruled in favour of the workers on December 17, 2020.

As a result, Alcoa will not incur the expected charge of $35 million to $40 million for employee-related costs in the fourth quarter.

The company will now expect a negative impact on income before income taxes of approximately $10 million in Q4 due to a related labor strike at both the San Ciprián aluminium smelter and alumina refinery. The court’s ruling does not resolve the strike.

“The Company believes it has acted in good faith and in full compliance with the law. The need to restructure the San Ciprián smelter persists due to significant and permanent structural issues,” the company said.