Tentative deal reached in bitter U.S. Steel lockout
A tentative agreement has been reached in the bitter 11-month lockout at US Steel’s Hamilton mill, the former Stelco Inc. operations, as the industry slogs ahead amid a slowing global economy.
The United Steelworkers union said Tuesday that details of the agreement will be presented to the 900 union members, who have been off the job for nearly a year, at a meeting Wednesday night.
“The union has stood united as one behind its negotiating committee in its opposition to company attempts to dictate concessions and its refusal to take up its social responsibilities towards its Hamilton Works labour force,” the union said in a statement announcing the new tentative contract.
“Local 1005 has stood as one behind the steadfast attempts of the negotiating committee to reach a negotiated settlement with U.S. Steel which the workers feel they can accept.”
Steelworkers Local 1005, which represents 900 workers, and the company reached a deal on Monday. A date for a vote on the agreement has not been set.
“We are hopeful that following the union’s ratification process, we will reach the end of what has been an 11-month lockout and see US Steel Canada employees return to work in the very near future,” company spokesman Trevor Harris said.
However, just how quickly the workers will be back on the job if the deal is approved was unclear.
“We will let the ratification process unfold and make our business decisions accordingly,” Harris said.
US Steel has been on an efficiency drive to become more competitive at its North American operations as it deals with a softening economy and weaker demand from some of its key industrial customers.
The deal at US Steel Canada’s Hamilton operations comes amid concerns about the slowing global economy.
A possible financial crisis in Europe and worries about government debt as well as a slower than expected recovery in the U.S. have weighed on the economic outlook. A slower economy could reduce demand for steel, a key industrial component in manufacturing and construction.
Marvin Ryder, a business professor at McMaster University in Hamilton, said the tentative agreement was reached as the workers’ employment insurance benefits were set to run out.
“I can’t figure out what the heck US Steel would have put on the table that was significantly different given their problems,” he said.
“The union is desperately trying to spin this as a victory of the collective bargaining process and union solidarity, but until I see the details, I don’t know.”
Ryder noted the steel industry appeared to be looking up in the first quarter of this year, but has since been mired in the sluggish recovery.
“Government money stopped being spent on projects, the private sector didn’t step up with any buying and so steel demand has at best stayed flat and more likely gone down,” he said.
“And there’s no sign that given the difficult situation in the American economy or in the European economy that that situation is changing dramatically.”
US Steel, the Pittsburgh-based steel icon (NYSE:X), bought Stelco in 2007 for $1.9 billion in cash and debt in a wave of takeovers that has put almost all of Canada’s major steelmakers in foreign hands.
