C O N F I D E N T I A L MINSK 001452

SIPDIS

SIPDIS

DEPT FOR DRL/IL BOB HAGEN, EUR/UMB

E.O. 12958: DECL: 09/07/2015
TAGS: ELAB PHUM PGOV BO
SUBJECT: MOTOVELO WORKERS GO ON STRIKE


Classified by Charge Constance Phlipot for Reasons 1.4
(B,D)


1. (C) Summary: Workers at a Minsk motorcycle plant went on
strike on November 25 demanding the factory pay their
October wages. After blocking a large highway for one and
a half hours, the factory administration finally agreed to
pay the wages by November 30. While on a regional trip, an
angry President Lukashenko told reporters that the strikers
should work harder if they wanted to earn their wages. The
factory's administration blamed the pay arrears on
bureaucracy and the former director's poor decisions.
Sources from the ILO and Perspektiva disagreed, explaining
that the factory, which is employee-owned but under
temporary government control, is almost bankrupt because of
its uncompetitiveness and bad management. End Summary.


The Protest
--------------


2. (U) On November 25, workers at the Motovelo bicycle and
motorcycle plant went on strike. Two hundred workers, who
had not received their October and part of their September
wages, congregated outside the factory's entrance. After
being ignored by the administration, the strikers moved
onto one of Minsk's busiest thoroughfares, Partizansky
Avenue, and formed a human chain that blocked traffic for
one and a half hours. The workers demanded the management
pay back wages and blamed factory directors for the
company's poor performance, the impeding large-scale
layoffs, and its expected bankruptcy.


3. (U) At 15:00, the factory directors and regional
administration promised to pay the workers by November 30
if they ended the strike. The workers exited the street,
but did not return to work and vowed to continue the strike
if wages were not paid as promised.


4. (SBU) Poloff witnessed the end of the demonstration,
though it was difficult to reach since the police had
closed most entrances onto Partizansky. Only 50 people
remained outside Motovelo's entrance when Poloff arrived
and the street soon opened for traffic. BKGB presence was
visible, but minimal and the only police present were
guiding traffic. [Comme

nt: Usually OMON riot police and
units of BKGB, who outnumber the protesters two to one,
break up unsanctioned demonstrations even when they are not
blocking traffic. At Motovelo, the OMON remained in their
buses in nearby courtyards.]


5. (U) One television crew was filming, but it was unknown
whether it was state-media or independent. Independent
news source Charter-97 reported that plain-clothes officers
did not permit news crews onto the scene. Other rumors
circulated that the Minsk bureau of the Belarusian-Russian
Mir broadcasting company refused to transfer video footage
that day, fearing that foreign TV channels would show
footage of the strike. An employee at Mir, Sergei
Nemchenok, denied the allegations and claimed that a notice
was issued in advance that routine maintenance of the
bureau's equipment would take place on that date.

The President's Angry Response
--------------


6. (U) While on a visit to the Gomel region, President
Lukashenko publicly condemned the Motovelo strike, claiming
he would not tolerate such actions and had no patience for
it. According to Lukashenko, Motovelo is a private company
owned by the workers, yet they want the government to save
them. [Note: Motovelo is currently under "temporary"
government control via the Golden Share policy. See para
9.] Lukashenko stated that the GOB would help the company,
but since it belongs to the workers, they must answer for
its economic status. The President demanded that the
strikers return to their work building bicycles and
motorcycles, earn their wages, and think about ways to work
better rather than rebelling in the street. The President
announced that he would soon implement measures to take
over the factory.

A Word From the Motovelo Administration
--------------


7. (U) Motovelo Director Vladimir Kluchnikov told reporters
on November 28 that the situation at the factory remained
complicated and tensions were still high. He also opined
that the workers do not understand what they are doing when
they strike. However, management is working to pay the
promised salaries and is in negotiations with the bank to
settle its debt to the workers. In a November 28 press
interview, Motovelo's technical director Aleksei Odintsov
announced that wages would be paid by November 30 and
blamed bureaucracy for the wage arrears, not the
management. Motovelo's administration faced problems with
the bank, not because the factory has no money, but because
the factory's level of trade is calculated every three
months. He added that the factory's debt to the workers
was a result of decisions made by the previous director.

Motovelo and Working Conditions
--------------


8. (U) Although Odintsov denied the wage arrears were due
to the company's poor economic standing, he later admitted
that Motovelo did not make a profit in 2005. Shareholders
did not receive dividends and all profits went to pay off
the company's debts. The first Deputy PM Vladimir Semashko
announced on November 28 that Motovelo's debt to the state
budget was USD 395,000, to the Minsk budget Q USD 558,000,
and had an energy debt of USD 1200. However, in his
opinion everything was fine at the factory. The average
wage is USD 200 and the company hopes to boost sales by
forming an economic partnership with China in the near
future. [Comment: This does not seem a realistic
expectation given China's production is usually more
competitive than Belarus'.]


9. (U) Odintsov admitted that due to falling sales, layoffs
were the only option for the company's future. Odintsov
claimed neither he nor the director of Motovelo own shares
in the company, therefore decisions are not made for
personal interest or gain. According to Odintsov, the
workers wanted higher wages in September, but there was not
enough money to do so. The director refused the raises and
the workers got angry. Therefore, the GOB took control of
Motovelo under the Golden Share rule and supported the
director's decision. To date, the workers are still not
satisfied with their wages.

What Unofficial Sources Had to Say
--------------


10. (C) In a November 28 phone conversation with the
International Labor Organization reporting officer in
Minsk, Natalya Varishagina, Poloff learned that Motovelo is
in dire financial condition. The bicycles and motorcycles
it produces are not competitive due to their high costs and
low quality. Workers are promised USD 140 per month, but
only if they meet their sales quota. Since they are unable
to meet these quotas, the workers are making only USD 107.
The workers' union at Motovelo, which is a branch of the
pro-government Federation of Trade Unions of Belarus,
failed to address the concerns of the employees to the
administration. According to Varishagina, the workers had
had enough and declared a strike.


11. (C) On November 30, Perspektiva leader Anatoliy
Shumchenko told Poloff that a Motovelo worker called to
inform him that the strike began. [Comment: Shumchenko
highlighted that the strikers did not contact the
opposition leaders or even the independent labor unions,
indicating to him that these organizations do not have the
strong support among the people that he does.] Shumchenko
immediately contacted the independent press and rushed to
the factory before the police closed the street. With the
streets closed, no one could access the factory, including
reporters. The police tried to persuade the workers to get
out of the street, but were afraid to push the angry mob.
Shumchenko claimed that the strikers were blaming
Lukashenko directly for their problems because he had
nominated the current director of Motovelo who subsequently
bankrupted the company.
The Result
--------------


12. (U) On November 29, Motovelo paid all wage arrears. On
November 30, the management promised employees that they
would take steps to revive the plant's economic standing.
Ivan Sinitsa, chairman of the plant's trade union committee
claimed that similar promises had been made and unfulfilled
in the past. A Motovelo informed independent news source
Belapan that GOB and law enforcement officials attending
the management-employee meeting and threatened the workers
with "harsh" penalties should they strike again. On
December 1, the Belarusian Prosecutor's Office filed
charges against Motovelo's administration for violating
labor legislation and its untimely wage payment.

Comment
--------------


13. (C) The Motovelo strike was the largest Minsk has seen
since the market vendors gathered in October Square in
February. If Shumshenko's opinions are correct, Lukashenko
saw how his support, despite the control he has on the
media and civil society, could end if Belarusian workers
are not satisfied with their pay, or lack there of.

PHLIPOT