US Steel is for sale, and the union wants to veto the buyers

There is a dramatic change in the American steel industry. One of the nation’s largest steelmakers, US Steel, is up for sale. The company’s unionized workers say they have the basic ability to veto any transaction they don’t agree with. But US Steel disagrees. Resolving the question may take some time. But the end result of the sale could have massive implications for both organized labor and the local steel economy.

It is very unusual for a labor union to have any real power over the outcome of a company sale. It depends Mike Williams, a senior fellow at the Center for American Progress. Usually, he said, a facility is allocated to whoever offers the most money.

“Just, you know, go sell, to the highest bidder. Good, thanks, bye. Good luck to the workforce,” he said.

But the United Steelworkers union, which represents most of US Steel’s employees, has planned for this kind of takeover scenario.

The fact that the steelworkers negotiated in succession clause “It was really important to include it in the basic labor agreement,” Williams said.

United Steelworkers was not available for an interview, however in messageThe president said the union has the power to bid on US Steel or choose another company to do so on their behalf. And the union has a clear favourite. It’s Cleveland Cliffs, another major steelmaker in the country. He also referred to the guild store Jeffrey HirschProfessor of Law at the University of North Carolina.

“This company already has a proven track record of working well with the union,” he said.

But the United States steel unacceptable The Cleveland-Cliffs initial offer, in a letter, said it was “unreasonable”.

The union could also reject US Steel’s choice of buyer. All this back and forth can take a lot of time. Hirsch said that could even lead to a strike.

“It is possible that the union’s arguments here can lead to some kind of work stoppage and disruption of steel production,” he said.

He said there is a lot at stake here for the company and the workers Anne Marie LovasoProfessor, West Virginia University School of Law. The company that buys US Steel can choose to close the plant, move it to another state, or abroad.

“This is how a lot of unionized workers have historically lost their jobs in this country,” she said.

Cleveland Cliffs is a US company, but Phil Gibbs, a senior equity analyst at KeyBanc Capital Markets, said there could be antitrust concerns if it acquired US Steel.

“This will be a combination of the number one and number two carbon sheet producers in the United States,” he said. “And that market focus is the thing we’re referring to.”

If the deal takes place, Gibbs said, it would promote industry consolidation — something companies in the supply chain, such as automakers, would not be thrilled about.

There is a lot going on in the world. Through it all, Marketplace is here for you.

You rely on Marketplace to analyze world events and tell you how they affect you in a fact-based and easily accessible way. We count on your financial support to continue making this happen.

Your donation today supports the independent journalism you depend on. For just $5 a month, you can help maintain Marketplace so we can continue to report on the things that matter to you.

Source link

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button