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Latest News - March 2011

March 2, 2011
Both sides prepare for strike at mill
Healthcare, pensions, pay in dispute

Source: The Virginia Gazette
By: Robin Lawson

WEST  POINT — More than 300 hourly workers at Smurfit-Stone Container Corp. are edging closer to a strike after 16 months of negotiations have failed to secure a contract.

The company is preparing to hire replacements just in case.

Members of United Steel Workers Local 8-0467 have authorized the union executive body to either accept a proposal or call for a strike, union president Larry Elliott said Monday.

Management made what it called its “last, best, and final” contract offer Jan. 12, but the union found it lacking.

In a letter to the papermill’s new general manager, Chris Broome, Elliott claims the company has issued $80 million in bonuses to salaried employees while demanding cuts from hourlies in its proposed contract.

“We don’t feel they’re bargaining in good faith,” Elliott said. “The people are tired of being presented proposals that are no good. We made a counteroffer in January to prevent a work stoppage, and they laughed at us.”

While the company has declared an impasse, Elliott said the union “is willing to negotiate.”

Smurfit-Stone informed employees in a letter Feb. 12 that the company’s final offer, minus certain provisions, will be implemented March 16. The union can still accept the proposed contract, to include lump sums previously offered, until March 16.

“We’re hopeful that we’ll reach an agreement,” Brad Gilks, the mill’s controller, said Monday.

Smurfit-Stone is preparing for a work stoppage. An advertisement in Wednesday’s edition of the Tidewater Review notes that Smurfit-Stone is “anticipating a labor dispute” and is seeking “temporary replacement employees to perform production and maintenance jobs.”

Gilks said, “We will continue to run the mill and meet our customers’ needs” in the event of a strike.

West Point’s hourly employees are working under an extension of a labor agreement that expired in September 2009.

Elliott said that in addition to a healthcare plan for active employees, four unresolved issues remain in the proposed contract:

• Eliminating retirees’ health care.

• Reductions in the pension plan.

• Eliminating double-time pay for holidays and Sundays. (The company proposes time-and-a-half.)

• Eliminating the Christmas bonus of one week’s pay.

The company cites “significant challenges regarding costs and competitiveness in a very difficult market” to justify the contract changes.

“In light of our continuing challenge to compete, and in light of the labor agreements at other Smurfit-Stone and competitor mills, we feel the last offer is fair and our reasons for taking the bargaining posture we did is necessary for a viable future for this mill and our company,” Broome wrote in a letter to hourly employees last month.

Smurfit-Stone is the largest producer of cardboard box materials in North America. The company emerged from Chapter 11 bankruptcy last year and has agreed to be acquired by Georgia-based RockTenn within the next several months. It’s unclear how a strike would affect that deal.



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