ArcelorMittal has discharged 51 probationary employees at its Burns Harbor facility.

“This development is not a reflection of the professionalism and dedication of the affected Burns Harbor employees,” the company said. “Rather it is strictly driven by the unprecedented economic environment we continue to face.”

Paul Gipson, president of United Steelworkers (USW) Local 6787, told the Chesterton Tribune today that the 51 workers did not have the minimum 1,040 hours of service needed to be officially represented by the USW--they averaged between 700 and 900 hours--and so were not covered under the basic labor agreement or under the layoff minimization plan negotiated with the company in November.

Under that plan 490 of the 3,450 USW members employed at the Burns Harbor facility agreed to be voluntarily laid off, with any retirements counting toward that number. Under that plan the company can also schedule 900 workers for 32 hours per week rather than 40, while Local 6787 agreed to forgo ovetime pay and cap an incentive program based on production during the layoff period.

ArcelorMittal, invoking the Workers Adjustment and Retraining Notification (WARN) Act, had originally announced the potential layoff of 2,444 members at the Burns Harbor facility.

Gipson did say today that, under a side letter accompanying the layoff minimization plan, the company is obligated, for the next two years, to consider these 51 people first before making any new hires of others. “They probably will,” he said. “They’ve invested a lot of money in training them.”

But Gipson noted that a good number of the 51 are relatives of long-time members and that he “will be pushing the company hard” to re-hire them. “Some of these people, I’ve known their family for years,” he said. “Considering and actually doing are two different things and I’ll keep on the company to hire them back.”

Local 6787 was ArcelorMittal’s only USW local to negotiate a layoff minimization plan, Gipson said, and a good thing too. “I’m familiar with the WARN Act. I knew what would happen if we reached an impasse. They would have laid off 2,400 members and started shipping our product somewhere else. They weren’t bluffing.”

Instead, the Burns Harbor facility is now filling orders placed at some of ArcelorMittal’s idled mills.

Meanwhile, Gipson said, the economic stimulus package enacted by Congress and signed by President Obama is unlikely to have any salutary effect on the domestic steel industry in the first half of the year. “I don’t see us feeling it until June. It’s got to be in the pipeline. It’s got to get into the system. Right now there are a lot of cars sitting in inventory waiting to be sold. Wow, that’s steel that doesn’t have to be made. And there aren’t any new homes under construction, so there aren’t any new appliances being bought.”

Gipson suggested that federal spending on infrastructure--on bridges in particular--could have a significant impact on ArcelorMittal’s plate division. “Once that gets going, that could really be good for us, the plate division.”

But the fact remains, Gipson said, that the economy is currently plumbing the depths. “It’s horrible. It’s ugly. I’ve never seen it this bad. It’s a good thing we did what we did, with the layoff minimization plan.”

Posted 3/5/2009