Union members on June 1 rallied in front of Asarco’s headquarters in Tuscon, Arizona to demand a new collective bargaining agreement that treats all of the company’s workers fairly and provides a long overdue pay raise.
Asarco, an integrated copper producer with facilities in Arizona and Texas, and eight unions representing Asarco’s 2,000 production workers have been negotiating a new collective bargaining agreement since 2013.
In 2007, the two sides agreed that the company would pay its union workers a bonus based on the price of copper, which became known as the copper price bonus.
But in 2011, the company decided unilaterally that it would not pay the bonus to new hires.
When bargaining began in 2013, the unions proposed that the bonus be paid to all union workers regardless of their date of hire, but the company so far has refused to budge on its decision.
“For nearly two years, we have fought to end inequality at Asarco,” said Bob LaVenture of the United Steelworkers (USW), who leads the collective bargaining negotiations for the unions. “But management refuses to address our unions’ serious concerns on behalf of newer hires and seeks to embed its unjust treatment of workers into our contract.”
The unions bargaining with Asarco have created a united bargaining team called the Copper Group. It includes representatives of the United Steelworkers, the International Association of Machinists, the Teamsters, and unions representing carpenters, electricians, plumbers and pipefitters, operating engineers, and boilermakers.
The two sides failed to reach an agreement when the old contract expired in 2013. Since then, workers have continued to work under the terms of the expired contract, and the unions and the company have continued to bargain.
The company’s 2011 decision not to pay the copper price bonus to new hires came as Asarco, which since 1999 has been owned by Grupo Mexico, was emerging from bankruptcy.
As part of the deal that allowed Asarco to escape bankruptcy, the unions agreed to allow Grupo Mexico to stop making pension contributions for new Asarco employees hired after July 1, 2011, thus eliminating pensions for new hires.
The company then interpreted its agreement with its unions on pension contributions to mean that it could also refuse to pay the copper price bonus to new hires.
Subsequently, the United Steelworkers filed a grievance charging that the company’s unilateral action to deny the copper bonus to new hires violated the collective bargaining agreement.
For good measure, the union made restoring the bonus for new hires one of its priority bargaining proposals, which in retrospect turns out to have been a good move.
In December, an arbitrator ruled in favor of the union and ordered the company to pay the bonus, but so far the company has refused to do so.
According to the Amarillo Globe News, the arbitrator’s ruling could cost the company between $8 million and $10 million.
In January, Asarco filed a suit in federal court to overturn the arbitrator’s decision.
Resolving the matter in court could take years, which is why the unions continue to make the extending the bonus payment for all employees one of their bargaining priorities.
“Union membership across all five facilities remains united in solidarity to demand fairness at Asarco, no matter when they were hired or where,” said LaVenture. “Our negotiating committee is fighting for everyone.”
Another union priority is pay. Asarco’s union workers haven’t had a pay raise since 2009, and according to a bargaining update issued by the Copper Group, “management continues to propose no wage increases.”
The company has also rejected union proposals to improve union members’ pension and 401(k) plans.
Grupo Mexico, Asarco’s owner, is one of the world’s largest mining corporations.
It reported a net income of $336.5 million for the first quarter of 2015 and a profit margin of 16 percent.
Its net earnings and profit margin is down a bit from the same period in 2014 largely because the price of copper is lower now than it was in 2014 and because the company has paid more than $90 million to repair environmental damages done to the Sonora River in Mexico after copper mining waste leaked from a Grupo Mexico mine in the state of Sonora.
The lower earnings report and profit margin and the cost of repairing damage done to the Sonora River did not prevent the company from paying a generous dividend to its shareholders.
Despite its modest slide in the first quarter of 2015, analysts are optimistic that Grupo Mexico’s fortune will rise.
Bloomberg reports that Grupo Mexico “is poised to rebound” and “will boost sales by expanding mines and investing in oil drilling.”
Grupo Mexico’s expansion plans will undoubtably make its billionaire owner German Larrea even richer; meanwhile, his US company Asarco is nickel and diming its US workers by refusing to pay the copper price bonus to hundreds of its employees and refusing them much deserved pay raises.