By Erik Potter, Post-Tribune staff writer
Union representatives and ArcelorMittal reached a layoff agreement Wednesday, reducing the number of layoffs at the Burns Harbor steel mill from the 2,444 proposed to 490.
ArcelorMittal had estimated the more than 2,400 job cuts as recently as Friday, notifying Indiana's Department of Workforce Development that the mass layoffs would start Jan. 25.
Under the agreement, the company will be looking for 490 workers to volunteer for layoffs lasting from eight to 32 weeks. Depending upon seniority, workers would receive from 60 to 80 percent of their regular pay during this time.
In addition, the company can take 900 workers and schedule them for only 32 hours per week rather than 40.
There are about 3,450 union employees at the plant.
With 1,750 employees eligible to retire, union president Paul Gipson said he expects no shortage of volunteers for the layoffs.
Any retirements will also count toward the 490 total.
The union also is forgoing any overtime pay and is capping its incentive program (a bonus system where workers receive extra pay for the volume of steel produced) to 20 percent of base pay, down from an average of 53 percent. That's for the length of the time the agreement is in place.
In return, the company has agreed not to employ any outside contractors while the layoff agreement is in place, not to transfer work that was scheduled for Burns Harbor to another ArcelorMittal plant, and to cut equipment costs wherever possible.
The agreement also spells out when the layoffs will end and when the plant must return to normal operating conditions.
The Burns Harbor mill normally produces about 50 "heats" of steel per day. During the current steel downturn, that amount has shrunk dramatically, down to only 18 heats per day. Once volume rebounds to 43 heats, however, the layoff will end. A "heat" of steel amounts to one batch produced from a particular furnace.
How long that will take to happen, however, remains to be seen.
A slow global economy and a strong dollar (which makes U.S. products more expensive overseas) are working against domestic steel production. Those economic factors don't appear to be changing anytime soon.
"It's better than a man on the street," said Gipson, who was pleased with the agreement. "It's better than not having a job. ... This plant is still the biggest employer in Porter County; (2,444) layoffs would have been devastating to this community."