Workers at Cascade Steel Rolling Mills say they’re ready to strike

By Don McIntosh

Workers at Cascade Steel Rolling Mills in McMinnville may go on strike if they don’t have an acceptable union contract offer by August 1. Profitable scrap metal recycler Schnitzer Steel is paying CEO Tamara Lundgren over $9 million a year while offering raises that lag behind inflation in negotiations over a new contract for the 280 members of United Steelworkers Local 8378. Schnitzer also wants to diminish dental benefits and make workers pay a much greater portion of their health insurance premiums.

Millworker Tim Davis, a member of the union bargaining team, says he and his coworkers made concessions in previous contracts and they’re in no mood to do that again at a time when the company is thriving. A continued construction boom is creating demand for mill products like rebar and wire rod that’s used to make nails; both output and prices are up. Meanwhile, foreign competition is down thanks to the 25% tariffs President Donald Trump imposed on foreign steel. And shareholders are reaping the benefits of Trump’s 40% cut in the corporate income tax rate.

But in bargaining with the union over a new three-year contract, Schnitzer Steel is proposing annual raises of 2.25%. Consumer prices in the region are rising 2.9% a year, according to the latest figures. Local 8378 negotiators are proposing 4%. Currently wages at the mill range from $22.17 an hour for utility workers to $31.58 for millwrights and $35.05 for electricians.

Concessions last time

Workers already lost ground to inflation in their last contract, which specified annual raises of 1% a year. Workers also agreed in that contract to a much less generous production bonus formula (Bonuses fell from thousands of dollars a year to just hundreds). And they agreed to pay a greater share of the health insurance premium: Their contribution increased by 1% a year and now stands at 16%.

Now Schnitzer wants to ratchet up workers’ share of the premium even more—by 4% a year, which would bring them to 28% by the end of the contract—close to what management calls “the Schnitzer standard” in which employees now pay 30% of the premium. In other words, Schnitzer is asking its union steel mill workers to lower their benefits until they match the company’s non-union scrap yard workers.

But the jobs are pretty different, says Local 8378 President Jim Blue.

WHAT THEY DO AT CASCADE STEEL ROLLING MIILLS Based in Portland, Schnitzer Steel is the fifth-largest publicly traded company in Oregon, worth $670 million on the North American Stock Exchange (NASDAQ.) Schnitzer makes most of its money from its network of 96 auto and metals recycling facilities around the United States, which includes the 52-location “Pick-n-Pull” chain where customers buy used parts off scrapped cars. But McMinnville-based Cascade Steel Rolling Mills, which Schnitzer Steel has owned since 1984, is the jewel of its empire. Along with a distribution center near Los Angeles, the two units make up Schnitzer’s Cascade Steel and Scrap division, which generates 20% of the company’s revenue. At the McMinnville steel mill complex, located on a 85-acre site off Route 99, members of United Steelworkers Local 8378 turn scrap into building materials. It’s a 24-7 operation: Steelworkers put in four days in a row of 12-hour shifts, followed by four days off. At the mill, powered by cheap electricity from publicly-owned Bonneville Power Administration, an electric arc furnace and ladle refining furnace melt and refine ferrous materials brought in from Schnitzer’s scrap yards. Molten steel then goes through a five-strand continuous billet caster, which turns out solid metal blocks. Those are then reheated in a natural-gas-fueled furnace and hot-rolled in a computerized rolling mill to create rebar, wire rod (used in chain link fence, nails, wire, and stucco netting), and merchant rod (rounds and square steel bars that are used to produce bolts, threaded bars and dowel bars).

“We work in a pretty harsh environment,” Blue said. “Some of the bag house dust is pretty toxic. There’s high heat. There’s some lead exposure. None of that’s really compatible with the human body.”

Schnitzer Steel is self-insured. Premiums for its Blue Cross Blue Shield plan are about $600 a month for employee-only coverage and $1,700 a month for family coverage. Under the company’s latest proposal, a worker who now pays the equivalent of $2,400 a year in premiums for family coverage could expect to pay $4,950 a year in three years given medical cost inflation of 5%.

Schnitzer also wants to slash dental coverage: The current plan pays for up to $2,500 a year in dental work, and the new plan would cover up to $1,750.

“It’s like they think we’re all stupid, and we don’t know how to use a calculator,” Davis told the Labor Press.

The union insisted on open negotiations this time, so that rank-and-file union members could come and watch the negotiations. Some are showing up regularly, and telling co-workers what they’re seeing.

“Everybody’s pissed,” Davis said. “That’s the nicest way I could put it.”

Roughly four out of five workers at the steel mill took part in a June 26 strike vote, with many coming in on their day off to cast their ballot, and the result was 97% approval to authorize the union bargaining committee to call a strike. Workers last struck at the mill in 2012, and came back to work after 12 days with the company making concessions, including a wage offer that increased from 0.5% to as high as 2.5%.

Union negotiators this time have so far rejected concessions and are calling instead for improvements: Besides 4% annual raises, the union is proposing to make Veterans Day a paid holiday for veterans, and to lengthen paid bereavement leave to five days, up from the current three. Workers are entitled to take the bereavement leave in the event of the death of a spouse or child.

The most recent collective bargaining agreement expired April 1, but Local 8378 agreed to extend its terms while negotiations continued. That extension expires July 31, after which workers could shut down the mill and walk off the job.

The two sides are scheduled to meet July 29, 30 and 31 with the help of a federal mediator.

“Our guys work for their money,” says Blue, the union president. “We’ve made these people a lot of money. We’re not asking to break them. We just feel with all the concessions we’ve made in previous contracts, they can treat us more fairly this time.”

2 Comments on Workers at Cascade Steel Rolling Mills say they’re ready to strike

  1. Interesting read, but there are s lot of stats in here that appear to be inaccurate. I used to work at Cascade (though in a non-union role) and I am certain there is misleading info in here, though maybe that reflects the perspective of members working at Cascade.

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