Rep. John Conyers Jr., (D-Michigan), has joined with the United Steelworkers of America to fight US Steel’s $750-million bid to buy the bankrupt National Steel’s assets because US Steel does not now plan to take over the pension plan, according to the Detroit Free Press (See Steel Unions Battling Potentially Lower Pensions ).
“I plan to do everything in my power to protect these families from government negligence and corporate abuse in these difficult times,” Conyers told the Free Press.
Conyers said Friday that he has asked US Steel Chairman Thomas Usher to change the company’s position. Conyers also wants to introduce legislation that would stop the federal pension insurer from “acting in a callous manner against the workers’ interests as they have done in this case.”
But US Steel officials have said that the company will not assume responsibility for the payment of National’s current pension plan and health benefits. They will leave that to the federal government’s Pension Benefit Guaranty Corp., (PBGC) which wants to take over the pension plan since National is currently in Chapter 11 bankruptcy reorganization.
The problem: the PBGC’s pension payments are limited by federal guidelines and are frequently less than what workers would gain from their employer’s original plan.
Mike Dixon, US Steel spokesman, said the company won’t
acquire National Steel’s assets if it has to pay extra
costs, such as covering pension plans.
“Obviously we are going to discuss the issue with the unions,” Dixon told the Free Press. “But what we come up with in terms of a contract has to be competitive to other agreements in the industry.”
Dixon added that the company knows it needs union support to complete the deal but the pension plan expenses are “too costly.”
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