ATI’s illegal lockout ends after union members ratify new contract

Members of the United Steelworkers (USW) at 12 Allegheny Technologies Incorporated (ATI) plants in six states ratified by a five to one margin a new collective bargaining agreement.

The ratification vote ends a six-month lockout that the National Labor Relations Board (NLRB) said was illegal.

The workers will return to work on March 13.

The NLRB on February 12 issued a complaint charging ATI with illegally locking out its 2200 union workers.

Ten days after the NLRB ruling, the company and USW reached a tentative agreement that members ratified on March 1.

“(The agreement) doesn’t solve all our problems, but it’s definitely a victory for the union considering what the company wanted to do to us,” said Walt Hill, a USW Local 1196 member and the union’s contract coordinator to the Pittsburgh Tribune.

When bargaining began last spring, ATI, one of the world’s leading producers of specialty steel and other metal products, proposed a list of 145 concessions that USW said would “cost workers thousands of dollars a year and erode decades of collective bargaining gains.”

After months of bargaining, the union pared down the list of concessions, but on August 6, ATI presented its last, best, and final offer to USW negotiators and issued an ultimatum: Present the offer to your members by August 10 and recommend ratification.

The company’s offer still contained a long list of concessions including a two-tiered wage system that would lower wages for new workers, new, much higher health care costs, the removal of restrictions on outsourcing work, changes to the grievance procedure, and the elimination of retiree health care.

As a result, the union refused the company’s ultimatum.

On August 15, the company locked out its workers. The lockout affected ATI plants in Western Pennsylvania; Albany, Oregon; Lockport, New York; Louisville, Ohio; New Bedford, Massachusetts; and Waterbury, Connecticut.

Evidence suggests that ATI had been planning the lockout for some time. Before the lockout began, the company began hiring replacement workers and extra security guards.

After being locked out, ATI’s workers took up their positions on picket lines outside of the company’s factories and stayed there even as winter set in and temperatures fell below freezing.

Meanwhile, USW filed unfair labor practices charges against ATI.

In December, the NLRB informed the union that it would file an unfair labor practices complaint against ATI for initiating an illegal lockout and for bad faith bargaining before and during the lockout.

“In all my years as a negotiator, I have never seen a company engage in such obvious bad-faith bargaining,” said USW’s lead negotiator International Vice President Tom Conway after the NLRB informed the union of its intentions.

Nearly two months later, the board filed its complaint and scheduled a May hearing with an administrative judge.

Had the complaint been heard and had the judge concurred that ATI’s lockout was illegal, the company would have had to compensate workers for their lost wages, benefits, and other losses resulting from the lockout.

After workers ratified the agreement, the NLRB dropped its complaint against ATI.

When bargaining on the new agreement began, the union was facing some difficult circumstances.

The decline in oil prices and the subsequent cutbacks in oil exploration had weakened the demand for products that ATI sold to the oil and gas industry, its second biggest customer.

Sales to the industry had declined by 34 percent.

Furthermore, worldwide overproduction and a resulting glut, reduced demand for its flat-rolled metal products by 60 percent.

As a result, the company’s net income for the past two years has been negative.

Entering negotiations, ATI was looking to reduce labor costs and used the temporary lack of demand for it products as an excuse.

While the company was telling workers that business was bad and they needed to accept concessions, it was telling a different story to investors.

According to the company’s 2014 annual report, the company’s future was bright, a quick turnaround was on the horizon, and the company would be profitable again soon, perhaps as  early as 2016.

The collective bargaining agreement that the two sides finally negotiated does provide ATI with some opportunities for lowering its labor costs.

ATI will be able to reduce its pension liabilities because new hires will no longer be eligible for the union workers’ defined benefit pension, and the workers’ health insurance plan will  no longer pay 100 percent of health care expenses after deductibles are paid.

The new health insurance plan covers 90 percent of the costs and workers will pay the rest until reaching the maximum for out-of-pocket expenses–$15oo for individuals and $3000 for families.

But workers will now be eligible for quarterly profit-sharing bonuses, a feature that the union was able to restore after the company succeeded in eliminating them in a previous collective bargaining agreement.

Workers will also receive a $1 an hour increase in their base pay, and the company will pay another $0.50 an hour to the Voluntary Employee Benefits Account that funds the retiree health care benefit.

The company will pay a modest signing bonus and agreed to contract language saying that it will not eliminate jobs by outsourcing them.

Western Pennsylvania ATI workers interviewed by the Pittsburgh Tribune said that the final agreement was better than they expected.

“Overall, it’s not a bad contract,” said Kirby DeCroo to the Tribune. “It’s (better) than what they were trying to jam down our throats.”

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