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    LAPLACE, La., Aug. 5 /PRNewswire/ -- Bayou Steel Corporation (AMEX: BYX) was not surprised that the United Steelworkers of America (USWA) announced their intent to launch a corporate campaign against the company.
    Bayou Steel Corporation maintains that this action by the Union was threatened before its labor contract expired on Feb. 28, 1993.  At that time, the USWA informed the company that if their demands were not met, the Union would employ three main weapons generally used to force companies to succumb to their demands.  They would first attempt to disrupt or shut down the operation by striking.  If that proved to be ineffective, they would keep the bargaining process tied up in the courts by filing countless charges of unfair labor acts.  As a last resort, they would initiate a corporate campaign.  The Union informed Bayou Steel that they had experts who specialized in each of these tactics.  These tactics are designed to force a company into an economic position wherein they either go out of business or give in to the Union's demands.  This adversarial style of bargaining uses force and disregards the economic realities that companies must face.  Both the company and its employees lose long-term when they can no longer be economically competitive.
    There have been many cases in steel labor history where the USWA "has brought companies to their knees" by utilizing their strategy of strike, litigate and smear.  A quick look at America's Steel Industry today reveals the effect of these so called "Union victories."  Many of those companies that were forced to capitulate either don't exist anymore or have significantly reduced employment.
    USWA membership has declined from 1,400,000 down to 700,000.  Bayou Steel has an obligation to its employees and its stockholders to assure that it does not make the mistake of reacting to short-term pressures that could adversely affect its goal of remaining a long-term viable employer in this community.
    When the Union leadership chose to strike on March 21 instead of returning to the bargaining table, Bayou Steel employees were making an average hourly wage rate of $12.29 per hour.  With their fringe benefits added, their total compensation was averaging $20.73 per hour.  The average annual earnings of those striking employees in 1992 was $34,700 and the average total compensation was $43,700.  There was no request by the company to reduce employees' base rates at the time they decided to strike.  The savings that would have been generated by changes to holiday, overtime and health care would have been transferred into an Incentive Plan that had the potential of adding another $6,000 to their paycheck.  When the Union decided to invoke a strike against the company, their proposal would have increased labor costs by $13 million disregarding the fact that Bayou had lost $6 million in the past two years.  The Union leadership repeatedly communicated to the media during the first several weeks of the strike that they went on strike over economic demands.  After being on strike for several weeks, they chose to attempt to convert this from an Economic Strike to an Unfair Labor Practice Strike.  This action initiated the second part of their three part strategy.  The company has done everything possible to convey to the Union that it simply cannot succumb to their demands or their tactics and remain viable long-term.
    Contrary to the Union's assertions, both productivity, as measured by tons produced per hour, and quality, as measured by rejection rate levels, have actually improved since the strike began.  In addition, the company has not locked out any of its employees and continues to accept strikers crossing the picket line.  The Union has had an open invitation from the company to return to the bargaining table and negotiate a reasonable contract.  The company has a strong resolve to do what is in the best long-term interest for its investors and its employees.
    -0-             08/05/93
    CONTACT:  Hank Vasquez of Bayou Steel, 504-652-0329

-- AT018 -- X440 08/05/93
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Publication:PR Newswire
Date:Aug 5, 1993

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