CLEVELAND – The United Steelworkers of America and creditors for bankrupt LTV Corp. have reached a tentative labor agreement as part of a restructuring plan to keep the company operating, the union said Friday.
The deal covers 9,000 employees of the LTV Steel subsidiary, including 3,200 in northeast Ohio.
LTV spokesman Mark Tomasch refused to confirm the agreement.
"We did this without cutting any current wages or savaging the retirees' health benefits," union spokesman Marco Trbovich said.
The company had sought at least $260 million savings in labor costs, out of a desired $800 million in total savings.
Instead, Trbovich said, the labor agreement will increase company cash flow through summer and fall, giving LTV time develop its restructuring plan. He would not give specifics.
Details would not be disclosed until union members were briefed, the USWA said in a statement.
A message seeking comment was left for Paul Singer, an attorney for LTV's creditors.
The labor agreement must be ratified by union members and approved by LTV and the bankruptcy court handling LTV's case. A hearing is scheduled for Monday in bankruptcy court.
LTV, which has been under bankruptcy protection since December, is the nation's third-largest integrated steelmaker, meaning it takes the metal from ore to scrap. It operates in 17 states, Canada and Britain.
LTV Chief Operating Officer John D. Turner said last month that without a new labor contract, the company will be forced to liquidate. Turner said the company has enough cash on hand to operate only through September.
The company blames its struggles on competition from cheap imported steel. Eighteen domestic steel companies have filed for bankruptcy protection since 1997, when global demand for steel dropped, forcing prices down and spurring more overseas manufacturers to turn to the United States to find customers.
President Bush on June 5 initiated a wide-ranging investigation of low-priced foreign steel. If the International Trade Commission finds that domestic producers have been seriously harmed, it could recommend punitive tariffs or quotas to restrict imports.
After weeks of negotiations with the union, LTV in June asked the bankruptcy court for permission to unilaterally impose a new labor contract on its workers, with significant reductions in health care benefits among other cuts.
Company officials said at the time that they went to the court because talks with the union had stalled.
Before the judge could rule, LTV's creditors stepped in and convened talks with the steelworkers and company executives.
LTV closed its West Side mill in Cleveland June 16, and laid off 800 union workers and another 100 not covered by the contract. The company says there is no way to make West Side mill profitable, but the union and some creditors believe they can find a way to reopen the mill.
At the request of the creditors, LTV has kept the plant's blast furnace running at "hot idle" status during the talks, rather than shutting it down completely. This makes it easier to restart production.
As part of the new agreement, the union won a request to study the possibility of refurbishing the mill. The idling will continue through the study, union spokesman John Duray said.
The corporation reported $719 million in losses on $4.9 billion in sales in 2000. Its losses in 1999 totaled $212 million.