USW files objection to RG Steel’s plan
The United Steelworkers union has filed an objection in U.S. Bankruptcy Court in Delaware opposing RG Steel’s plan to pay 21 employees through the end of the year.
“This case has been disastrous for [RG Steel’s] employees, retirees and creditors, and the communities in which [RG Steel] operated. [RG Steel] shuttered its facilities and conducted a failed auction process in which, with one exception, its steelmaking facilities were sold to liquidators. Bargaining unit employees have lost their jobs and, in most cases, remain unemployed,” according to the objection filed by USW attorneys.
RG filed a motion Oct. 25 requesting authority from the court to implement a “Key Employee Retention Plan,” which would allow the company to pay $767,000 to 21 unidentified salaried employees if they stay through the end of 2012.
The money would allow a $2,000 monthly stipend for each individual for the employees to purchase health insurance along with a bonus payment that would be equivalent to three months salary. RG has stated these people perform essential functions relating to sales, accounting, treasury, information technology and administrative functions.
“These payments appear to be gifts, not retention payments, as, by the time of the hearing, nearly three-fourths of the alleged covered period will have passed,” according to the objection.
RG Steel filed for bankruptcy May 31. At that point, the company began a process to finish existing orders. In June, more than 1,000 workers were laid off at the Warren facility.
Since then, the site was purchased by C.J. Betters Enterprises, a Monaca, Pa., company that bought the mill out of bankruptcy for $17 million.
Betters’ ownership group winterized the plant in the event an operator can be found to restart operations.