Century Aluminum Kentucky plant workers reject deal

Wages, health insurance at issue in negotiations
By Luc Cohen / Reuters
|labour-reporter.com|Last Updated: 05/05/2015

HAWESVILLE, KENTUCKY (Reuters) — Unionized workers at Century Aluminum's Hawesville, Kentucky smelter voted to reject the company's proposed labour agreement on Monday, taking one of the biggest U.S. aluminum plants closer to industrial action.

The news followed a vote at the plant on Monday after Century, which is controlled by Glencore, tabled its "last, best and final proposal" last week.

On Friday, the company issued a notice warning that if United Steelworkers (USW) Local 9423 members did not approve the final offer, it would lock out union-represented employees starting May 11.

Some 84 per cent of members voted to reject the offer, according to a notice on the USW website.

If workers go on strike, it would be the first industrial action at a U.S. aluminum smelter in more than a decade.

The union members had previously rejected two tentative agreements reached between Century and the union's bargaining committee to replace the former deal that expired on March 31.

Temporary employees have been trained at the smelter in recent days and the company has set up trailers to house them in the past few weeks, a union representative said on Monday before the voting had finished.

That may prevent disruption to production at the 244,000-tonne-per-year smelter even with the lockout, he said.

A spokesman for Century was not available to comment on the trailers and temporary workers.

The union had previously announced that strike rules would be read at Monday's meeting. The union's rejection comes on the heels of several recent smelter cutbacks and closures in the United States and elsewhere.

At issue in the negotiations are health insurance and wages.

Century said last week that its proposal contained no increases in healthcare contributions in 2015, and that even after increases beginning in 2016, Hawesville employees' contribution rates would be below the average for employees at other manufacturing companies.

The proposed contract also included wage increases of 15 per cent over five years, not including overtime, it had said.

The Hawesville facility is the fourth-largest of eight active U.S. smelters, producing just under 15 per cent of the country's total 2015 smelting capacity of 1.7 million tonnes.

Talks over the new deal have been fraught as management seek to keep costs in check while London Metal Exchange prices remain under pressure and physical premiums plunge amid lackluster demand and a massive global surplus.

High production costs have forced the closure of a large portion of U.S. capacity by companies like Alcoa in recent years.

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