Retired Allenport employees will have a chance to select future medical benefits – but at a highly increased cost.
RG Steel LLC, through federal bankruptcy proceedings, was successful in negotiating a modified labor agreement with several states, including Pennsylvania, which will impact a number of retirees of the former RG Steel plants, including those at the former Allenport plant.
Under terms of the new agreement, and because of the liquidation of the company and all of its subsidiaries, promised benefits under the original labor agreement will no longer be available to former employees as of Friday. Those benefits involve medical, prescription drug and life insurance. Jon Saunders, contract coordinator and Wheeling Volunteer Employee Benefit Association committee trustee, said those impacted involve those who retired after Aug. 1, 2003, or who were a part of a buyout plan the company offered in 2003 offered when it emerged from bankruptcy.
Saunders said 400 to 500 Allenport retirees will be affected.
Only those who received letters about their benefits are affected.
On Sept. 1, affected retirees will receive enrollment packages detailing three options from which to choose. Those options will be discussed in a meeting 10 a.m. Sept. 7 at the Allenport Fire Hall.
Anyone who chooses to continue their medical benefits under one of those plans will have coverage retroactive to Sept. 1, Saunders said.
The premium hikes, though, will be substantial, Saunders warned.
Those currently paying $150 a month will see their premiums increased to $637 a month –with less benefits, he said.
Those on Medicare who were paying $65 a month, will pay $200 going forward, he said.
“These are going to be life changing,” Saunders said.
Saunders said the USW bargained for months with every national carrier and the plans that will be laid out for the steelworkers were the best available.
“This bankruptcy led to a liquidation and that was what led to the harm, because there is no more company, no one to pay that,” Saunders said. “We fully understand this bankruptcy has incurred a lot of hardships on the retirees in Mon and Ohio valleys,” Saunders said.
The Allenport plant had not operated since May 2008, when then-owner Esmark Inc. ceased operations. Esmark acquired the plant in a successful proxy takeover battle with Wheeling-Pittsburgh Steel six months earlier.
In August 2008, Severstal acquired Esmark's Wheeling-Pitt steel holdings for $1.25 billion. RG Steel acquired the plant in 2011.
Nearly a year later, Mon River Partners purchased the former Allenport Plant with plans to convert the site into an industrial park.
Chris Buckley is a staff writer for Trib Total Media. He can be reached at 724-684-2642 or cbuckley@tribweb.com.
