Bechtel slows work on Transylvania highway, mass layoffs in sight

Bechtel says it was waiting for a EUR 41.7 million payment for its work on the Transylvania highway, after having completed 5 kilometers of a first 25-kilometer section of the road.
The firm said the measure could affect its 2,300 employees working on the highway project.
However, the government sees Bechtel's decision to slow down work as a unilateral one, which could allow the state to re-consider continuing the contract, according to the CNADNR.
Bechtel workers who are suspended following the construction company's decision must still be paid, under Romanian law, until they are asked to re-start work, said Michael Mix, project manager for the Transylvania highway project.
“We regret the need to take this measure, but we can't continue works without being paid and without having free and full access to pieces of land that are large enough and connected one to each other,” said Mix. In the event of mass layoffs, Bechtel employees assigned to the highway project would receive two monthly salaries as compensation. So far, several hundred employees have been asked to halt work on the site.
“We pledge to work with the Ministry of Transportation, CNADNR, union and government leaders to solve this situation,” said Mix.
“In our view, the slowdown of activity is a consequence of the CNADNR not asking constructors to close sites and prepare works for conservation for the winter season. Bechtel's decision is surprising, because the company has a prepared work site,” said CNADNR.
The state company said it had asked the finance ministry for the necessary sums to cover works and that it had also offered Bechtel the option to continue work by approving the technical project for a new sector of the highway, the Gilau-Mihailesti portion. Work on the Transylvania highway, which will connect Brasov to Bors, started in 2004, based on a EUR 2.2 billion contract awarded to US company Bechtel.
In 2005, the government re-analyzed the contract awarded by the previous governing party. The highway is now due for completion in 2012, and works are currently in progress for the 25-kilometer sector between Gilau and Campia Turzii.
The Transylvania highway will connect Brasov to Oradea and the Hungarian border, on a 415 kilometer route. The US construction company had previously estimated it would employ 8,000 workers in 2010, when works on the highway were expected to peak.
Corina Saceanu