Contract negotiations are ongoing for some steelworkers on Minnesota’s Iron Range. The United Steelworkers have announced a tentative three-year labor agreement between the union and U.S. Steel Corporation.
Existing contracts expired at midnight on Friday, August 31, 2012. The tentative agreement is good news for steelworkers for U.S. Steel’s Minntax mine in Mountain Iron and the Keetac mine in Keewatin, Minnesota.
According to reports coming out of the Labor Day holiday, the negotiations are now focusing on ArcelorMittal – a unit of Luxembourg-based ArcelorMittal S.A., the world’s largest steel company and the owner/operator of the Minorca Mine in Virginia, Minnesota.
Talks between the USW and ArcelorMittal continued on Monday, beyond the initial deadline (midnight Saturday) set by the USW. According to the USW leadership, “We have not taken the strike option off the table, only concluded that now is not the time.” Of course, the fact that “ArcelorMittal has recently begun the process of taking asset preservation steps at its facilities” in anticipation of a possible work stoppage, is not indicative of a pending agreement.
ArcelorMittal is seeking a two-tier wage system which would provide lower wages and fewer benefits for new hires. In essence, ArcelorMittal wants to treat new hires differently from current union employees. If the USW and ArcelorMittal agree on a two-tier system, it would be the first such agreement negotiated at a major unionized U.S. Steel mill.
ArcelorMittal is trying to cut costs during a period of slowing demand and weaker prices. According to the industry, the steel business has been negatively impacted by the European debt crises and a slowdown of Chinese demand. ArcelorMittal’s biggest rival, the Nucor Corporation, is not unionized. An interesting twist to the story, Nucor is based in Charlotte, North Carolina, the location of the Democrats’ National Convention taking place this week.