A company name has changed, but the process is familiar.
Five years after ALCOA Inc. and the United Steelworkers reached a contract agreement, negotiations on a proposed three-year deal between the USW and Arconic are going down to the wire.
The contract expires today at 11:59 p.m. Central Time, which is 12:59 Thursday morning in the Eastern Time Zone.
This is the first contract negotiation for the aluminum company since ALCOA Inc. was split into Arconic and Alcoa Corp. in 2016.
As is normal procedure for management, the new company is not addressing proposed contract details publicly. Arconic spokesman Cary Dell did say Tuesday the company is continuing to negotiate in good faith to obtain a fair contract.
Also as usual, the USW is addressing its version of the negotiations more publicly and specifically. Once a tentative agreement is reached by negotiators, the USW rank and file will vote on it.
That requires the majority of the membership be convinced of the agreement’s merits before a new labor deal can be secured.
On the other hand, if shareholders don’t like the deal, they can sell their stock or protest at their next annual meeting.
USW Local 309 President David “Buzz” Sawyer, who represents labor at Tennessee Operations in Alcoa, is in Pittsburgh with the union’s negotiating team.
The contract involves a total of 3,400 Arconic employees at four locations: the local operations, as well as plants in Davenport, Iowa; Lafayette, Indiana; and Massena, New York.
The sticking point this year, as USW characterizes the negotiations, is health care benefits. In an update Tuesday, the union said: “Bargaining with Arconic continues to be difficult and slow. In addition to the freeze in the defined benefit pension plan, the company is demanding substantial cuts in medical and drug benefits and increases in employee health care contributions.”
The labor side says management’s proposal increases employee coinsurance from 15% to 20% while increasing out-of-pocket maximums from $1,500 single and $3,000 family to $2,000 and $4,000, respectively.
USW says the company’s proposal for family premiums would increase by $121 per month, or by 60% over the three-year contract. That amounts to a reduction of 70 cents per hour worked, according to the union.
“Over the years, union members at Arconic (and its predecessor ALCOA) traded lower wage increases for good benefits and health coverage,” the update states.
Under the proposed contract, according to the USW, workers get to “choose” a medical plan with lower coverage to get lower employee premiums, risking large out-of-pocket expenses.
“This is really no choice at all,” the USW update says.
The union did not release specifics of its own demands to counter the company’s proposal.
If an agreement is not reached by tonight’s deadline, an extension of negotiations could be agreed to, which is what happened five years ago between ALCOA and the United Steelworkers.
The last union strike of the aluminum company was in 1986.
In the event of a work stoppage, Arconic would operate Tennessee Operations with salaried employees and resources from outside the company.