Despite big profits, Asarco demands concessions from workers

Asarco workers in the US Southwest rallied at their work sites on July 28 for a fair contract. Asarco has been seeking steep concessions from its union workers at five mines, smelters, and refineries in Arizona and Texas.

The nearly 2,000 hourly employees belong to eight different unions that have formed a united negotiating team called the Copper Group. The group is led by the United Steelworkers (USW) District 12 Director Robert LaVenture and Sub-District Director Manny Armenta.

Workers have been working under the terms of a collective bargaining agreement that expired in July 2013.

Despite a healthy bottom line and encouraging prospects for the future, Asarco, which is owned by Grupo Mexico, one of the world’s major copper producers, wants its US union workers to accept pay cuts, higher health care premiums, and contract changes that make their jobs less secure.

The company also wants to provide fewer benefits to its new employees.

Wearing black t-shirts with the simple message, “Solidarity” on the front and “We are one, we are strong on the back,” workers rallied outside the gates of Asarco’s Silver Bell mine in Marana, Arizona; Mission mine near Tucson; Ray mine in Kearny, Arizona; Hayden 5 smelter in Hayden, Arizona; and its copper refinery in Amarillo, Texas.

The rolling rallies took place on the same day that negotiations between the unions and Asarco resumed.

When negotiations broke off earlier this year, the company was still demanding that workers pay higher health care premiums. The union reports that if workers accepted Asarco’s health care demands, their premiums would increase between 800 percent and 900 percent.

The current contract, which workers ratified in 2011, establishes a two-tiered structure for health care premiums that requires workers hired after July 1, 2011 to pay a higher health care premium. The company wants to retain the current two-tiered structure; the unions want the new contract to lower payments for new hires and to maintain current premium payments for those hired before July 1, 2011.

The company also wants to reduce the workers’ Copper Price Bonus that the company pays quarterly. The bonus is based on the average price of copper and amounts to about $7,000 a year per eligible employee.

In addition to lowering the bonus, the company wants to put more restrictions on who is eligible to receive the bonus.

After the 2011 contract negotiations ended, the company took the position that new hires weren’t eligible for the bonus and refused to pay it to them.

The unions characterized the company’s position as a contract violation and filed a grievance, which went to arbitration. An arbitrator’s decision is still pending.

Asarco’s new proposal would continue to deny bonus payments for new hires and would make those suspended for any disciplinary reason and those who are absent from work for an extended period of time ineligible for the bonus as well.

The company also wants the bonus to be tied to company-set productivity goals over which workers and their unions have no control.

Perhaps the most important concession that Asarco wants is for the unions to give up the successorship provision in their contract. The successorship provision requires a potential buyer to recognize the unions and negotiate a collective bargaining agreement.

Giving up the successorship provision would put Asarco workers’ job in jeopardy should Grupo Mexico decide to sell Asarco.

The possibility of new owner is quite real. Asarco has change hands several times since it was founded in the 1940s, and the Wall Street Journal reports that at least one other copper mining company, Freeport-McMoran, is interested in expanding its US operations.

The lack of a successorship provision would make Asarco much more attractive to Freeport-McMoran, which has a suspect labor relations history.

Until 2013, it was a sponsor of the American Legislative Exchange Council (ALEC), a right-wing group that encourages and assists state legislatures pass anti-worker legislation.

In 2008, reports Bloomberg, Freeport-McMoran fired 691 workers at its North American operations to save money.

In 2011,  the company unsuccessfully used replacement workers to break a strike by workers at its Grasberg mine in Indonesia. During the strike, one striker was killed by members of the national police force, which the Guardian reports was paid by Freeport to provide security at its mine.

According to the Steelworkers, Asarco isn’t making its concession demands because the company is losing money. Far from it, USW reports that Grupo Mexico American Mining Corporation, Asarco’s owner, reported net income of $1.5 billion in 2013.

Randy Flowers, president of USW Local 5613 at Asarco’s Amarillo refinery said that Grupo Mexico’s concession demands aren’t just about saving money.

“The company’s proposal can only be characterized as an attempt to gut our current agreement,” said Flowers in a report to members. “(But) the fight is not over, (and) we won’t relent.”

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2 thoughts on “Despite big profits, Asarco demands concessions from workers

  1. Wow! Is the company simply “greedy”? No, this is the logic of capitalism. If the employer thinks workers are weak and the atmosphere is receptive (e.g., movement to the right in U.S. politics), the employer will try to make the workers take less so that the employer’s profit grows. “Accumulate, accumulate! This is Moses and the Prophets!”–Karl Marx

    • Lesile, is not greedy, they had a contract, the company followed it, it’s very simple besides bonus should be based on performance not just something that operators don’t have control of.

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