USW negotiations continue as representatives report that progress had been made in the latest round of contract bargaining with US Steel. Negotiations between the two entities will continue and a strike will be avoided provided that gaps in asks from union members can be filled in a reasonable timeframe.
Currently, US Steel proposes an additional $145 healthcare premium per month to be used toward healthcare and dental coverage. Representatives for the USW negotiations calculated the lifetime cost to workers over the term of the agreement would total $10,440. The number would eat up the proposed wage increases from the USW and effectively put workers back at square one.
Key issues that remain to be resolved include health and dental costs, incentive pay, supplemental unemployment benefits, and disagreement on the use of a Voluntary Employees Beneficiary Association fund.
Following this week’s announcement that US Steel workers voted in favor of strike approval, ArcelorMittal steelworkers across the region have mobilized in preparation for a strike authorization vote of their own. The vote will take place next week on Monday.
Members will meet with USW leaders at the meetings, where they will receive updates on the expected bargaining process, a rundown on strike rules, review benefits afforded to members during a strike, and, if deemed necessary, pursue strike authorization. A recently released update included the statement, “If significant progress is not made by early next week, we will return home to deliver detailed reports at membership meetings and seek your support for a strike authorization.”
If the strike is approved, the United Steel Workers Union members at ArcelorMittal locations throughout the United States could join US Steel steelworkers in a complete work stoppage in the event contract negotiations fall apart. USW officials and steel companies have been in contract negotiations for months leading up to the workers’ September 1st contract expiration date.
ArcelorMittal Steelworkers Unsatisfied With Proposed Terms
ArcelorMittal has earned the ire of steelworkers, who have not received a pay raise in three years, for proposing concessions that include hits to supplemental unemployment, incentive, vacation pay, hot-rolled steel bonuses, and health care. Union representatives communicated that these concessions could result in as much as an additional $8,000 per year in out-of-pocket health costs for the affected families.
US Steel released it’s own update on Wednesday of this week, saying, “We have submitted a revised proposal to USW leadership that reflects the ongoing dialogue during our most recent round of negotiations. The revised six-year proposal, which we strongly believe is in the best long-term interest of all U.S. Steel stakeholders, includes a 14% base wage increase over the term of the agreement, guaranteed profit sharing, and healthcare premiums offset with transition payments.”
Currently, U.S. Steel, ArcelorMittal, and workers are operating under contract extensions.
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The whole situation is rooted in a decision made three years ago, when U.S. Steel was on the verge of bankruptcy. Workers conceded to a wage freeze and reduced work hours in the hopes that the company would rebound from dire straits. In short, it did. U.S. Steel is now expecting profits to exceed $2bn, the highest in 10 years.
According to a union spokesperson, “Angry USW members conducted strike authorization meetings at each U.S. Steel local over the past week.”
United Steelworkers’ Unrest
Among the chief complaints from steelworkers are having undergone three years of work without pay increases, which comes at a time when US Steelmakers are reaping significant gains. For perspective, hot-rolled coil steel is currently selling for $900 a ton, according to the metal pricing website SteelBenchmarker. To put that into perspective, steel prices have more than doubled from the low of $412 on Dec. 14, 2015. Roughly the same three-year period in which workers state they have not experienced a pay increase.
To add insult to injury, USW claims that CEO David Burritt and U.S. Steel upper-management have endowed themselves with more than $40 million in compensation since 2015.
Proposed Changes To United Steelworkers’ Contracts
After three years with no pay increases, the USW is coming to the negotiating table seeking raises. However, the Pittsburgh-based steelmaker is looking for concessions that include more out-of-pocket health care costs, reduced retiree benefits and a commitment to no raises in the latter half of a proposed six-year contract.
According to US Steel, the contract includes a $4,000 signing bonus, at least $6,000 in profit-sharing and wage increases over the first 3 years of the 6-year contract. On top of the proposed terms, US Steel says that employees will gain $0.15 per hour towards their 401(k) retirement plans.
According to a statement issued by the USW, “Our committee will be returning to Pittsburgh next week to resume negotiations with U.S. Steel management in an effort to reach an honest and fair settlement. As you know, management’s proposals so far have been completely unacceptable, particularly in light of the company’s projected profit this year of nearly $2 billion. We will be sure to keep all members informed of any progress we make at the table next week and of whatever next steps we anticipate.”
Consequences Of A United Steelworkers Strike
The consequences of a USW strike, at least on the US manufacturer, will depend on the size and scale of operations and whether or not a manufacturer has a stockpile of materials to work with. Make-to-order manufacturers will be at the highest risk of disruption and may find fulfillment increasingly difficult if the supply of raw materials is cut abruptly. when it comes to manufacturers who are not a level-one priority for raw steel, the result is having to choose to cut production or pay the import fees on steel from outside the US and passing the cost on to their customers. If the latter is the case, those manufacturers run the risk of losing customers as a result of higher prices for their manufactured goods. On the customer-facing end, higher prices for steel may be on the horizon.
US Steel And The United Steelworkers Strike Of 1986
U.S. Steel was involved in a strike/lockout situation more than 30 years ago in 1986. During this work stoppage, about 22,000 steelworkers brought about the longest steel industry work stoppage in US history. The strike/lockout lasted from August 1, 1986 to January 31, 1987.
The effects included disrupting deliveries, expensive and unplanned plant-idling operation. To continue running at a diminished capacity, management-level employees began loading trucks and trains with previously-produced steel kept in inventory themselves and shipping it to customers. The result was violent clashes between management with striking workers.
USW forms the largest industrial labor union in North America with 860,294 members. Their current rate of dues is equal to 1.45% of total earnings, plus $.02 per hour. This tops out at a maximum of 2.8 the average steelworker’s hourly rate, plus $.02 per hour. Minimum dues are $5.00 per month.
Relevant US Steel, US Steel Steelworkers, And USW Union Salary Information
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