Asarco/Grupo Mexico must pay bonus to new hires; NLRB files complaints against the company

A federal district judge has ruled that Asarco and its owner, Grupo Mexico, must pay bonuses negotiated in a collective bargaining agreement to hundreds of workers covered by the agreement who did not receive the bonus.

According to the United Steelworkers (USW), the amount owed to the unpaid workers could be as much as $10 million.

Asarco/Grupo Mexico operates five copper mines and refineries in Arizona and Texas where it employs 2000 production and maintenance workers.

In 2011, Asarco/Grupo Mexico and its workers’ unions agreed to a new collective bargaining agreement that required the company to pay quarterly bonuses based on the price of copper to workers covered by the agreement.

Four months after the agreement went into effect, Asarco/Grupo Mexico announced that it would not pay the copper price bonus to new hires.

After the announcement, USW, the largest of eight unions that represent Asarco/Grupo Mexico workers, filed a grievance.

The grievance was heard by an arbitrator who ruled in 2014 that the new hires must be paid the copper price bonus.

US District Judge Stephen McNamee on March 4 upheld the arbitrator’s ruling.

The judge’s decision is Asarco’s/Grupo Mexico’s ‘s latest setback in its attempt to implement new, cost-cutting labor policies without consulting or bargaining with its workers’ unions.

Before Judge McNamee ruled in favor of the unions in the quarterly copper bonus dispute, a National Labor Relations Board (NLRB) regional office in January filed a fourth consolidated unfair labor practices complaint against Asarco/Grupo Mexico.

The latest NLRB complaint stems from a two-and-a-half year battle between the company and its unions over a new collective bargaining agreement.

In 2013, USW and seven other unions began bargaining with Asarco/Grupo Mexico on a new collective bargaining agreement.

The company demanded steep concessions, but the unions resisted.

When the agreement expired, the unions agreed to continue working under the terms of the expired agreement while negotiations continued.

After two years of tough bargaining, the unions informed Asarco in June 2015 that they were terminating the expired agreement but continued working as negotiations progressed.

While negotiations were in progress, the unions charged the company with unfair labor practices.

The NLRB agreed and filed complaints against Asarco/Grupo Mexico for failing and refusing to bargain with its unions and other unfair labor practices.

In October 2015 as negotiations were still in progress, Asarco/Grupo Mexico announced that beginning December 1, it would implement its last, best and final contract offer.

When December 1 came, the company implemented some of its last, best and final offer.

Among other things, the company changed it scheduling. which extend the time that workers must stay on the job, cut overtime pay by revising its method for calculating overtime, eliminated health care coverage for future retirees, and increased health care cost for workers.

It also changed the formula for calculating the copper price bonus. As a result, workers won’t be receiving the bonus as long as the price of copper remains at or below its current level.

The NLRB’s latest complaint filed in January charges Asarco/Grupo Mexico with illegally implementing its final, best, and last offer.

Since Grupo Mexico purchased Asarco in 1998, it has had a contentious relationship with its unions that in addition the USW, include the International Brotherhood of Boilermakers, the International Brotherhood of Electrical Workers, the Teamsters, the International Union of Operating Engineers, the International Association of Machinists, the United Brotherhood of Carpenters, and United Association, which represents plumbers, fitters, welders, and service technicians.

In 2005, union workers struck the company. During the strike, Asarco/Grupo Mexico declared bankruptcy. In addition to voiding the collective bargaining agreement with its workers, the bankruptcy filing helped the company avoid billions of dollars in liabilities for polluting the environment.

The unions in 2007 managed to secure a new collective bargaining agreement that included pay raises and quarterly bonuses tied to the price of copper.

The company remained in bankruptcy, however, until 2009 when higher copper prices attracted new financial backers, who pumped billions of dollars of new financing into the company.

High copper prices allowed for a brief period of labor peace, but in 2011, the price of copper began to fall and has continued to do so since.

As copper prices have dropped, Asarco/Grupo Mexico has attempted to shift the risk of lower copper prices from its investors to its workers by cutting labor costs.

Its first step was to deny the copper price bonus to new hires. Next in 2013 it sought steep concessions from its workers in the new collective bargaining agreement. Finally, it decided to implement its final, best, and last offer.

On March 15, an administrative judge will hold hearings on the NLRB’s unfair labor practices complaints that Asarco/Grupo Mexico has accumulated in its efforts to shift its costs of doing business onto the backs of its workers.


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