Union files claims against RG Steel

Staff report


The United Steel Workers has released a membership update about what the union is calling an “inappropriate, unfair and outrageous effort” to continue to pay a small number of employees through the end of the year.

RG filed a motion on Thursday asking the bankruptcy court in Delaware for authority 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.

“The company’s plan to reward a select few people still collecting paychecks with bonuses is a slap in the face and a shamefully predictable effort to reward its own,” according to the USW statement. “Meanwhile, RG owes steelworkers and retirees monies for unpaid vacation, severance, medical claims and other broken promises.”

The union has filed claims against RG for unpaid items totaling more than $600 million.

“The USW fully intends to make the bankruptcy court aware of our objections to this cash grab,” according to the union.

There will be a hearing on the issue Tuesday.

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.

Since then, the Warren facility was purchased by C.J. Betters Enterprises, a Monaca, Pa., company that bought the mill out of bankruptcy for $17 million.

Mark Zigmont, economic- development coordinator for the Trumbull County Planning Commission, estimated that $50 million in grants and loans will be needed to help investors bring the former RG Steel Warren mill back to life.

The company has begun a process of winterizing the plant in the event an operator can be found to restart operations.

RG Steel representatives were not available to comment.

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