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Steel workers forgo increases for profit sharing.

Steel workers forgo increases for profit sharing

About 2,900 employees of Bethlehem Steel Corp.'s unprofitable bar, rod, and wire plants in Johnstown, PA, and Lackawanna, NY, have agreed to wage and benefit concessions in exchange for preferred stock and a profit-sharing plan. According to the president of United Steelworkers Local 2632 in Lackawanna, the company would probably have closed the operations if the workers had not accepted the modifications of the current agreement, which runs to July 31, 1986.

Under the accord, the workers will no longer receive incentive pay. Instead, they could receive the "first dollar' of daily incentive earnings from a profit-sharing plan and they will receive shares of preferred Bethlehem stock equivalent to the balance of daily incentive earnings.

They also will receive preferred stock (which will be given to them at age 62) equivalent to the other concessions, which include:

Elimination of 2 weeks of paid vacation, beginning in 1986.

Termination of dental and vision care insurance, effective July 1, 1985.

Elimination of an earnings protection plan, under which employees bumped into lower paying jobs received temporary pay supplements.

Reduction of Sunday work pay to time and one-quarter (from time and one-half) and holiday work pay to double time (from double time and one-half).

Reduction of shift premium pay.

Broadened job assignments to permit better utilization of the work force.

Elimination of a provision of the 1983 contract calling for restoration in 1986 of a $1.20 an hour cut in wages and benefits.

The accord also provided for lump-sum payments to induce older employees to retire by July 31, 1985. The payments range from $4,800 for workers age 61 years and 1 month to $400 for those age 62 or over.

Despite the concessions, more than 500 of the 2,900 workers were expected to lose their jobs as part of the effort to reduce costs. More than 400 of the 800 nonunion salaried employees also were expected to be terminated.

In the legal area, Bethlehem settled a lawsuit by agreeing to make no postretirement changes in life insurance programs for retired supervisory employees and to establish a new health care plan for the retirees and their dependents. The settlement, which covered nearly 20,000 retirees, was initiated by a retiree (later joined by 3,000 others) who contended that Bethlehem had broken a pledge to continue the health benefits after they retired. The settlement does require retirees to begin paying a premium, fixed for life, toward the cost of the coverage.
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Title Annotation:Bethlehem Steel Corp.
Author:Ruben, George
Publication:Monthly Labor Review
Date:Jun 1, 1985
Previous Article:Steel producer seeks protection under Chapter 11.
Next Article:Budd workers get lump-sum payments.

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