Steelworkers (USW) and ArcelorMittal have agreed to extend, for a “short”
but unspecified period of time, the union’s current three-year contract,
only hours before it was set to expire at midnight tonight.
The USW announced
the extension just before deadline today and added that it is subject to a
48-hour notice should either party opt to terminate it.
The USW did not say
this morning whether a similar extension was, or might be, in the works for
its current contract with U.S. Steel Corporation.
The union did say,
on the other hand, that “little progress” has been made with ArcelorMittal
since negotiations began on July 9. “Our negotiating committee has been
patient in the face of ArcelorMittal’s attempts to frustrate us. We have
sought out common ground where management seeks only to divide. We have
provided reasonable alternatives to the company’s unreasonable demands.”
ArcelorMittal’s latest proposal for a three-year contract, the USW said,
members would earn wage increases of 2 percent in the first year and 1.5
percent in each year thereafter, plus a signing bonus worth approximately
$1,980 after taxes.
The raise and lump
sum together would total an increase in a member’s annual take-home of
around $2,365 per year or $7,095 over the contract’s lifetime.
On the other hand,
concessions which ArcelorMittal is demandingÑin the hot-rolled bonus
threshold, healthcare premiums, insurance plan design, and other provisions
of the proposed contractÑwould cost the average hourly employee about $2,265
per year or $6,795 over the contract’s lifetime, the USW said.
do not include all the company’s demandsÑsuch as to reduce SUB pay or
eliminate the full week guarantee,” the union added.
committed to negotiating a fair agreement: ArcelorMittal steelworkers have
earned and deserve wage and pension increases and health insurance without
the $200 monthly premiums for family coverage,” the USW said. “Nevertheless,
all USW members should plan to report for all scheduled shifts and continue
to focus on working safely.”
Three years ago,
under pressure from plummeting oil prices, a strong dollar, and cheap
foreign imports, steelmaking in the U.S. had tanked. ArcelorMittal was
selling steel in 2015 at an average selling price of $734 per ton and posted
a net loss in that year of $7.9 billion; while U.S. Steel was selling it at
an average price of $696 per ton and posted a net loss of $1.5 billion. And
both companies were announcing idlings and shutterings: ArcelorMittal, for
instance, idled its East Chicago long carbon facility; while U.S. Steel
closed coke operations at Gary Works, idled its Granite City, Ill., Works as
well as multiple tubular facilities, and announced the end of steelmaking at
its Fairfield, Ala., Works.
The fortunes of
both companies have since changed.
posted a net income in 2017 of $4.56 billion and U.S. Steel a net
income of $387 million. For the first six months of 2018, ArcelorMittal
posted a total net income $3.05 billion and U.S. Steel a total net income of
$232 million. And in the second quarter ArcelorMittal was selling steel at
an average realized price of $853 per net ton, 16 percent higher than it
sold a ton at in 2015; while U.S. Steel was selling a ton of flat-rolled at
$819 per net ton, nearly 18 percent higher than it sold a ton at in 2015.
More: earlier this
year U.S. Steel to great fanfare re-opened the Granite City Works.
contention since contract negotiations began this summer is this: members
were willing to forgo raises when times were tough but the market has since
rebounded, President Trump has imposed long-sought tariffs on imported steel
and aluminum, and the sorts of concessions which both ArcelorMittal and U.S.
Steel are seeking don’t appear to reflect economic reality.