Pension at center of disagreement at Neville Island plant
August 13, 2013 4:00 AM
Union workers from the Neville Chemical Company stand outside the gates Monday morning.
By Ann Belser Pittsburgh Post-Gazette
There are two major items on which Neville Chemical and the United Steelworkers disagree: the pension obligation of the Neville Island company and whether its union workers are locked out or on strike.
The upshot is that management is inside the fence that surrounds the plant on the Ohio River island and the members of District 10 Local 5032 United Steelworkers are outside.
Both sides have squared off before.
In 2006, the workers were off the job for 61/2 weeks. That earlier work stoppage ended with the union taking wage concessions that were restored on the last day of that contract. The next contract was negotiated in 2008, again with the union taking concessions.
This past year, the company turned a profit and handed out profit-sharing bonuses to workers who had helped make that possible by paying $150 a week toward their health care and taking pay cuts.
The most recent contract expired in January and the sticking point in negotiations is the pension.
Forty-six days ago today, the company informed the union that it would be freezing the workers' pension as of Monday. Three days before the deadline, the union informed the company that its members could not work under the imposition of the new pension when it had not been negotiated into the bargaining agreement.
On Monday, instead of working shifts at the plant, the workers traded their safety gear for shorts and T-shirts as they covered shifts outside the gate, holding signs and waving at passing cars and trucks as the drivers honked their horns in support.
The union has even set up a tent near the entrance of the chemical plant with laptop computers to help the workers it says are locked out to sign up for unemployment compensation.
The company wants to replace its pension plan with a 401(k) plan for workers.
"401(k)s are not equal to a defined benefits plan," said Charlie Leonard, the staff representative for District 10 of the USW. "We're not asking for an increase of our pension. We just want to keep it."
The 105 members of the USW local have an average tenure of 30 years working at the chemical plant producing hydrocarbon resin, which goes into other materials to make them tacky like glues, rubber and ink.
"The pension they've had for 30 years is still there, the benefits still exist," said Tom McKnight, president and CEO of the company.
The issue going forward is that the company wants to convert future pension benefits to a 401(k) into which the workers would contribute money and the company would match up to a certain amount.
Mr. McKnight said the existing pension is not fully-funded. "The issue to the company is that meeting the obligation is not sustainable," he said.
Mr. McKnight says the men outside the gate are on strike.
Mr. Leonard said the union has helped the company by reducing labor costs to turn Neville Chemical from a money loser to profitability. He said Neville Chemical, which is privately held, made more than $4 million last year and freezing the pension would save the company just $400,000 a year.
"There's a bunch of older guys there who are 45 or 55," Mr. Leonard said. Most of them make about $22 an hour and are looking down the road at retirements that are drawing closer.
"The Steelworkers have helped a lot of companies that are financially strapped. We did it here. But when they're making money there's no reason for us to lose anymore."