THE MARCH 2011 labor agreement between RG Steel and The United Steelworkers Union, which represents nearly 4,000 employees of the bankrupt steel company, will be terminated Thursday and immediately replaced by a modified labor agreement if a motion filed late Friday with the bankruptcy court gets judicial approval at a hearing set for 10 a.m., Thursday, Aug. 23, 2012.
The approach being put forward by company and union officials is identified as "consensual" in the motion, and is stipulated as the basis for the company extending certain health benefits through the end of the month that might have been stopped without this action.
Approval of the motion will bring a number of other benefits to an immediate stop as the basic labor agreement of March 2011 is almost immediately expected to be replaced by the proposed modified labor agreement.
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THE?CURRENT labor deal between RG ?Steel and The United Steelworkers may be terminated and replaced with a modified agreement, pending the outcome of a motion filed Friday with bankruptcy court.
If the motion is approved as it stands, some benefits will now be seen as having stopped retroactively to Aug. 10, something local union presidents say they were only alerted to late Friday after having been told previously to tell members their benefits were still completely intact at least through Aug. 15.
Concerning wages: the motion proposes a flat wage of $20 per hour be enacted.
"As a consequence of the imminent curtailment of continued funding, the company has advised the USW of its pressing need to terminate the 2011 BLA in all respects, expect as specifically provided in this MLA. Accordingly, the company has advised the USW of its intention to seek court approval under section 1113 and 1114 of the Bankruptcy Code to terminate the 2011 BLA and all retiree welfare benefit programs sponsored by the debtors," stated the proposed motion.
Among the benefits to be stopped with the implementation of the modified labor agreement are what is referred to as "SUB" (proposed as retroactively stopped on Aug. 10); RG Steel's obligations with respect to required contributions to the Steelworkers' Pension Trust (proposed as retroactively stopped on Aug. 10); all active and retiree benefit programs described in the basic labor agreement will be considered terminated effective Aug. 31.
The debtors are to place into escrow $6.5 million from the proceeds of the assets sales "which will be used for the purpose of paying medical and prescription drug claims incurred on or before Aug. 31, 2012and received on or after Aug. 11.
Objections to the motion can be filed with the court no later than noon on Wednesday, Aug. 22, 2012.
According to documents placed on record late Friday with the court, the action is being supported at the top levels of both company and union.
The motion filing includes a copy of a summary of what is identified as a "settlement and modified labor agreement".
An exhibit attached to the proposed motion includes communications from David Pryzbylski, RG steel's chief administrative officer to USW District 1 Director David McCall dated Thursday, Aug. 16.
Local union presidents say they were told to expect a filing of a motion requesting the contract be terminated and replaced by a proposed modified labor agreement sometime next week, not Friday.
Loccisano can be reached at kimfromthetl@gmail.com
