Steel Products

USW Receives First Contract Proposal from ArcelorMittal

July 23, 2015

ArcelorMittal submitted its first proposal to the USW negotiating committee on Monday. According to USW, the three-year keeps wages as is, cuts benefits, raises health premiums and makes changes to retirement contributions.

The USW posted the following changes proposed by the Company in an update to members:

The company has proposed a three-year contract with no wage increases throughout its term, along with a proposal to reduce incentive payments while eliminating incentive altogether for workers in Labor Grade 1.

In addition, the company’s demands include major reductions in vacation pay and sickness and accident benefits.

Management has also proposed major changes to health care for both active and retired union workers that are designed to reduce coverage and increase costs, including monthly premium contributions for active employees of $150 for single coverage and $250 for families. The proposal also included significant increases in monthly premium contributions for current and future retirees that could more than triple their current contributions.

The company is also seeking to stop all contributions to the VEBA, which will negatively impact current and future retirees’ contributions and eventually eliminate benefits for legacy retirees.

ArcelorMittal’s proposals include a lower, two-tier system of compensation and benefits for new hires, and the company has reserved the right to propose more concessions.

“Overall, (ArcelorMittal) has cherry-picked parts of other USW contracts from a variety of industries to form the basis of a labor agreement that management believes will make the company more profitable,” the USW stated in a prepared release.

A spokesperson for ArcelorMital said the proposal hoped to close the labor cost gap without reducing wages. According to a 2014 company fact sheet, ArcelorMIttal average wages for union represented members are $97,964, among the highest in the nation, and employees pay no health care premiums.

“It is not uncommon in negotiations like this for things to get off to a slow start, as each side attempts to first get a feel for where the other expects the talks to go,” the union said in its update. “Our goal remains the same – to reach a new master agreement to replace the current 3-year contract that expires on Sept. 1.”