Arconic has told United Steelworkers Local 309 that the company is cutting its Tennessee Operations workforce by 30 hourly positions.
The reduction in force (RIF) comes as the union has 651 hourly workers employed at the Alcoa plant.
Local 309 President David “Buzz” Sawyer said Monday the union’s contract with Arconic requires the company to offer voluntary severance packages before layoffs can occur.
In a statement Monday, the company said, “Tennessee Operations is offering up to 30 voluntary quit packages to hourly employees as part of the company’s additional cost reduction initiative, which was announced by leadership during the last earnings call.”
Friday is the deadline for employees to accept the severance deal, according to Sawyer. As of Monday, more than 30 union members had indicated they would accept the package, but they have until Friday to turn it down, so that’s not official yet.
He said union officials and Arconic met last week and agreed to benefits in the severance package offered by the company.
“This language has been in effect for several contracts. Most ALCOA retirees are aware that before there is a layoff (the company) has to offer a voluntary severance package. That’s a good thing. I mean just three weeks ago we hired new people,” Sawyer said.
The ALCOA Inc. retirees worked at Tennessee Operations prior to the company splitting into Arconic and ALCOA Corp.
The workforce reduction decision was revealed to the union after a recent visit to Tennessee Operations by the company’s top official, Sawyer said. Arconic Chairman John Plant was appointed chief executive officer in February after the board of directors rejected a private-equity buyout offer for the company, industry media reported at the time. Word of the job reduction came about one working day after Plant’s visit.
“They told me business conditions is the reason they’re having the reductions,” Sawyer said.
Avoidance of layoffs depends on whether enough senior employees, who receive more money under the severance package than workers with less seniority, decide to accept retirement earlier than they had planned, Sawyer said.
Younger workers were worried when they learned of the job losses.
“So I had immediate communication with my group, my union leadership, and told them here’s the contract language and this is what we’re going to do. Right now everybody just hold steady and we’ll see if there’s enough of the senior people that want to take this and we’ll see how it works out,” Sawyer said.