ArcelorMittal, U.S. Steelworkers Reach Four-Year Pact

By [bn:PRSN=1] Nancy Kercheval []

Aug. 31 (Bloomberg) -- ArcelorMittal, the world's biggest steelmaker, and the union representing steelworkers at the company's U.S. plants reached a tentative four-year agreement yesterday after four months of talks.

About 14,000 production, maintenance and clerical employees represented by United Steelworkers at 14 ArcelorMittal plants in eight states voted Aug. 28 to authorize a strike if a contract wasn't reached by Sept. 1, the union said in an e-mail. The workers make up 4.5 percent of the global workforce of ArcelorMittal, according to the company's Web site.

``We believe that ratification of the proposed agreement is a major step toward raising the industry standard in wages, benefits and other contractual protections without sacrificing the long-term viability of ArcelorMittal in a competitive market,'' Steelworkers District 1 Director David McCall said in a statement issued by PR Newswire. The union declined to disclose provisions of the contract.

The agreement remains subject to ratification by the USW, which is expected to take about 30 days, ArcelorMittal spokesman Haroon Hassan in London said in an email.

``We believe that we have reached a positive outcome for all parties involved without disruption to our business operations,'' Michael Rippey, ArcelorMittal's president and chief executive officer of U.S. operations, in an e-mail.

The two sides have been negotiating since April. Points of disagreement included a proposed 39 percent increase in health- care premiums for retirees, the union said in an Aug. 26 letter urging members to approve a strike.

U.S. steel prices fell 2 percent in August, from a record the previous month, as customers rejected increased charges proposed by larger producers and opted for lower-priced metal from smaller mills, Purchasing magazine said.

Record prices for raw materials like scrap metal, coal, iron ore and energy allowed steel prices to almost double this year and prompted larger companies including ArcelorMittal to add special surcharges.

To contact the reporter on this story: Nancy Kercheval in Washington at nkercheval@bloomberg.net.