National, Bethlehem Settle

Monthly Labor Review, November 1993 | Go to article overview

National, Bethlehem Settle


National, Bethlehem settle

Two months after Inland Steel Industries signed a lead-off, precedent-setting contract with the Steelworkers, Bethlehem Steel Corp. and National Steel Corp. settled with the union on similar terms. The National Steel contract covers about 6,700 active workers in Michigan, Illinois, and Indiana, and the Bethlehem Steel pact covers about 10,500 active workers in Indiana, New York, and Maryland.

The settlements provide longer than usual contract terms with expected cost reductions and work rules changes in exchange for enhanced job security and expanded union and worker empowerment. The agreements also bring the Steelworkers union one step closer to its goal of reshaping collective bargaining in the steel industry.

The 6-year contracts call for $500 lump-sum bonuses immediately and on March 1, 1994, August 1, 1994, and March 1, 1995; and on April 30, 1996, a bonus of up to $1,000 at Bethlehem if the company makes at least $250 million in profits in 1995, and $1,500 at National if the company makes a profit of at least $100 million in 1995. At Bethlehem, employees may opt to accept 25 shares of stock in lieu of the March 1994 and March 1995 bonuses, while the company has the option of providing equivalent shares of stock in lieu of the April 1996 bonus. At National, the company can opt to pay the April 1996 bonus in equivalent shares of stock.

The contracts also included a 50-centan-hour wage increase at National on August 1, 1995, and at Bethlehem on July 31, 1995; continuation of the costof-living adjustment provision; and a 1996 wage and benefit reopener that calls for binding arbitration if the parties cannot reach an agreement.

In the job security area, the Bethlehem settlement guarantees a 40-hour workweek during the term of the agreement for employees with at least 1 year of service, except if a division is permanently shutdown, the contract is rejected by a bankruptcy court, or the company experiences severe financial conditions. It also provides the recall of laid-off workers at the company's Sparrows Point, MD, facility. The National contract retains the employment guarantee negotiated in 1986, stipulates the recall of 158 laid-off workers, and increases the waiting period to 2 years (previously 1 year) for coverage of newly hired employees under the employment guarantee.

In exchange for the employment guarantees, the parties reportedly agreed to discuss, at the plant level, implementation of cost reductions through improved use of employees and equipment. To enhance productivity and competitiveness, they reportedly agreed in principle to eliminate certain restrictive work rules and to make unspecified work force reductions through attrition.

Changes in pension benefits included the adoption at National of a new formula which increases the monthly pension rate by $3-$5 and expands the eamings base for computing benefits. At Bethlehem, the minimum monthly pension rate was boosted by $5 per year of credited service: this means that an employee retiring after 38 years of service would receive a monthly pension of $1,053.50. In addition, both contracts continued the special payments to surviving spouses and increased minimum benefits payable to surviving spouses.

In the area of cooperative partnership arrangements, both contracts allow the union to nominate a member to the company's board of directors and permit the union and employees to participate in the company's decisionmaking process. …

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