Steel Mills

Highlights of US Steel Labor Contract

Written by Sandy Williams

The negotiating committee at US Steel reached a tentative agreement on a new labor contract on Saturday, Dec. 19. Although terms of the contract will not be officially released until after ratification, the Pittsburgh Post-Gazette obtained a copy and revealed some of the content.

The new contract references slowdowns for the company including those at US Steel at Fairfield Works and the delayed construction of the EAF in Birmingham, Ala. US Steel plans to cut capital expenditures to $1.2 billion during the three year period of the new contract.

The USW held firm against US Steel’s proposal for a two-tier wage system that would have paid new workers lower wages.

A revised profit-sharing agreement gives workers a 15 percent share of profits (up from the previous 10 percent) if US Steel clears $50 per ton of steel shipped. If profit per ton shipped is in the range of $10 to $50, workers would receive the 7.5 percent stipulated in the last contract. US Steel hopes the new plan will be an incentive for employees to work with the company to cut costs and improve margins.

Health care premiums, which were a major sticking point in the negotiations, ended in a compromise: workers will not make premium contributions but will have higher co-payments.

“Given the times, this is a good deal,” said Thomas Conway, vice president of administration for the union. “Things are tough right now. This union understands the reality better than anyone else. In a simplistic way, you’re bargaining a slice of a pie, and if there’s not much of a pie, you’re going to struggle.”

Conway told the Tribune Review that the victory on premiums was balanced against accepting a wage freeze and changes to health plans that would lead to higher cost-sharing of medical bills for some union members because of the increase in payments for their share of prescriptions and doctor visits.

“People using a lot of health care are going to pay more, but nothing like the levels of premiums that the company was seeking,” Conway told the Tribune-Review.

No pay raises are included in the new contract but laid off worker will receive some relief from “enhanced” supplemental unemployment benefits, called sub pay, from the company.

The union membership will vote on the proposed contract following the New Year holidays.

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