Steelworkers union says U.S. Steel using downturn to ‘gut’ contract
The United Steelworkers union accused U.S. Steel on Friday of using an industry downturn to demand a range of concessions, including cuts to health care benefits for workers and retirees.
The union and company are in talks on a labor pact to replace a three-year contract that will expire Sept. 1 at a time when the domestic steel industry is being battered by low prices, cheap imports and weak demand from oil and gas customers.
“It’s clear from this initial outline that U.S. Steel is attempting to use the current industry downturn to gut our contract and weaken our union,” the union said in a statement on its website. “These proposals do nothing to address the current climate in the steel industry — they are designed instead to take advantage of that climate to weaken our contract,” the statement said.
U.S. Steel wants its 17,000 union-represented workers to contribute to premium costs for their health care benefits, add annual deductibles starting at $2,600 and eliminate policies for Medicare-eligible retirees, according to the union’s statement. The company is asking for concessions related to vacation time, overtime, severance and other items.
R.J. Hufnagel, a union spokesman, said the United Steelworkers expect to receive more details of U.S. Steel’s proposal next week as talks continue, but he declined to comment further.
U.S. Steel officials declined to comment.
The company, which had its first profitable year since 2008 last year, reports earnings for the second quarter Tuesday. It posted a net loss of $75 million in the first quarter this year. Its revenue in the quarter dropped 25 percent to $3.3 billion.
CEO Mario Longhi has led an initiative, known as Carnegie Way, to improve the company’s performance through cost cuts and by making its operations more efficient.
Tough market conditions led U.S. Steel to issue layoff notices to 9,000 workers in North America earlier this year — though only about a third of those workers lost their jobs — as it idled mills to deal with slack demand.
The union is in contract talks with other steel producers, including ArcelorMittal and Allegheny Technologies Inc.
Workers at ATI agreed to stay on the job while talks continue on a contract to replace the one that expired June 30. ATI is asking for many of the same concessions as the union said U.S. Steel wants.
ATI CEO Richard Harshman this week said lowering the cost of employee benefits and gaining flexibility over working conditions are key factors in returning the company to profitability. Harshman’s comments, which were made as ATI reported a $16.4 million loss in the second quarter, drew an angry rebuke from union officials.
Steelworkers are planning a rally Thursday in front of PPG Place, Downtown, where ATI’s corporate offices are.
Alex Nixon is a staff writer for Trib Total Media. He can be reached at 412-320-7928 or [email protected].