US steel workers seek payout from trade war as prices rise

US steel workers are ready to get their payout from the trade war.

Labor contracts with US Steel Corp and ArcelorMittal expired Sept 1, but workers remain on the job as negotiations over wage increases continue.

On Tuesday, US Steel posted on its website a proposed six-year contract, offering workers guaranteed annual wage increases and a US$15,000 pre-tax cash payment, including a minimum profit-sharing of US$6,000 for the balance of the year, regardless of the company performance.

The company;s proposal is far from fair, and it’s public characterisation of that proposal is far from factual, United Steelworkers, known as USW, said in a statement emailed after US Steel publicly announced its offer.

“They’re trying to buy a long-term, very cheap deal with some up-front money to distract workers from the long-term costs.”

Workers are insisting on their share of the windfall from the 36% increase in the benchmark hot-rolled coil price this year after President Donald Trump imposed a 25% tariffs on steel imports.

While companies have reported that demand will remain strong through the rest of 2018, US Steel’s share price has declined 17% this year amid analyst downgrades and concerns about long-term pricing.

Workers have gone without a wage increase in the past three years, USW said in a statement. Negotiations with US Steel cover more than 16,000 workers in 24 local unions, while those with ArcelorMittal involve about 15,000 workers from 13 localities.

Since the current labor contract includes profit-sharing, it’s unlikely that a strike will occur, KeyBanc Capital Markets research analyst Phil Gibbs said in a telephone interview before US Steel announced its offer to its workers.

“USW members at USS locations this week will be conducting informational meetings prior to taking strike authorization votes,” Wayne Ranick, a union spokesman, said in an email Tuesday, prior to the announcement from Pittsburgh-based US Steel.

“The USW committee will meet with our ArcelorMittal membership at all locations to discuss the next steps,” he said.

“If the committee determines that strike authorisation is needed to achieve a fair contract, the members will vote after they have been given a chance to ask questions and review information with their elected local and international leaders.”