AGREEMENT REACHED WITH USW LOCAL 2724

Today, ESSAR Steel Algoma reached a collective agreement with USW Local 2724, the union representing our technical, professional and front line management employees. The new agreement comes into effect August 1, 2010 for a four year term.


Following is the news release that we issued:

Statement from Essar Steel Algoma

Mediator's Recommendation to Settle

The Company and USW Local 2724, the union representing the Company’s technical, professional and front line management employees, have agreed to take the mediator’s recommendation to settle to their principals and membership for ratification.

Click here to view the news release that we issued

Negotiations Update - July 29, 2010

By: Jim Rennie, Chief Negotiator


We don’t want a strike. But we require change.

To do this there are certain changes that the Company requires.

At 2 pm today the Company presented a settlement offer to the bargaining committee for USW Local 2724. This offer affects all USW 2724 and includes some certain provisions specific only to Front Line Supervisors (FLS).

This settlement offer includes some changes from the offer we shared with you yesterday.

THIS HAS NOT CHANGED

For all USW 2724 members:
· 3.5 % wage increase over three years,
· Continuing COLA rolled in quarterly throughout the life of the agreement,
· Extending the pension windows,
· Introducing a defined contribution pension plan for new hires,
· Increasing the shift premium and boot allowance, and
· Improvements to extended health benefits.

For the FLS’ only:
· A one-time salary increase of 5% for all FLS in operating and maintenance roles,
· Two additional “C” days for all FLS,
· Giving FLS the right to receive the special discretionary bonus provided to exempt staff, and
· At the Company’s discretion improved health care benefits to FLS.

These FLS’ only improvements are in recognition of the following changes to FLS only:
· Enhancing the Company’s ability to fully utilize each FLS’ talent and abilities to maximize operational and succession planning goals,
· Providing that FLS may not serve in a formal union capacity due to the legally recognized inherent conflict of interest between union and management responsibilities, and

THIS HAS CHANGED

For FLS’ only:
· Overtime compensation will be paid when the 8 hours between 40 and 48 are worked consecutively. In the event that they are not worked consecutively there is no overtime up to 48 hours worked in a week, and for hours worked beyond 48 in a week, “C” time or overtime will be paid at the option of the FLS.

· Before any FLS’ employment is terminated, the decision must be reviewed and approved by the department Vice President, the Vice President Human Resources, the Vice President Legal and the Chief Executive Officer. In the case of dismissal without just cause, an FLS will receive either severance of up to 18 months salary or may be reassigned by the Company to an alternate position in ESSAR Steel Algoma.

For all of USW 2724:
· A contract term of 2.5 years, with a proposed expiry of January 31, 2013. We do not have the ability to stop and restart our operations and therefore need to take measures to ensure the preservation of the assets so that in the event of a labour disruption there is a business to go back to. A 2.5 year term ensures that at minimum the integrity of the assets will always be preserved in the event of a labour dispute with either union local.


We don’t want a strike. But we require change.

The fact remains that the Company needs to be competitive. The steel business has changed and will continue to change and ESSAR Steel Algoma needs to be able to adapt to these changes so we can be competitive.

This settlement offer is the best balance between achieving that competitiveness and recognizing the role our employees play in the organization.

Negotiations Update re: L2724

By Jim Rennie, Chief Negotiator


The Company is now three days from the strike deadline with USW Local 2724, the union representing our technical, professional and front line management employees. It is becoming increasingly clear that we will not reach a collective agreement and will face a labour disruption on August 1, 2010.

In an effort to achieve a collective agreement, the Company has given Local 2724 a full offer. The highlights of the offer are:

· 3.5 % wage increase over three years,
· Continuing COLA rolled in quarterly throughout the life of the agreement,
· Extending the pension windows,
· Introducing a defined contribution pension plan for new hires,
· Increasing the shift premium and boot allowance, and
· Improvements to extended health benefits.

You can read the Company’s full offer here. We encourage you to read this.

This same offer was overwhelmingly accepted by the members of Local 2251 in last night’s ratification vote.

In return for these enhancements we need to make changes to the collective agreement to allow us to be competitive with all other North American steel producers.

Every one of these changes are part of the existing terms and conditions of employment of all of the major steel producers.

Here are the changes:

JOB POSTINGS

Everything remains the same with continued promotion and movement opportunities for employees except the Company (not the Union) determines the legitimate qualifications required for the job.

The successful candidate will now be selected on the basis of qualifications, skill, ability and previous work experience. If these factors are relatively equal between candidates, seniority will govern.
This is how it is done in all other major competitors. We need to catch up to them.

Details can be found in Addendum 3, page 24 of the offer.



SHARED SERVICES

We need changes to the collective agreement that allow us to benefit from and contribute to the shared services of the ESSAR Group.

Our competitors have global affiliations that give them greater access to raw materials, research and development, technology and international talent pools. This access allows ESSAR Steel Algoma experts to contribute to special projects throughout the ESSAR Group and conversely, gives us the benefit of access to expertise in other areas of the ESSAR Group. Cost savings achieved and productivity gains realized through shared services are essential to help make ESSAR Steel Algoma more competitive.

No employee will be laid off due to shared services and in case of reassignment to a new job salary rate is protected.

Details can be found in Addendum 2, page 19 of the offer.





FRONT LINE SUPERVISORS (FLS)

Every other steelmaker in North America has their front line supervisors fully engaged with the management of their business and have conditions of employment similar to all management staff. That’s not the case at ESSAR Steel Algoma and that needs to change for us to be truly competitive.

We have proposed nothing different from what exists elsewhere and in some cases the proposals are superior to our competitors.

The following compensation improvements have been offered;
· A one-time salary increase of 5% for all FLS in operating and maintenance roles,
· Two additional “C” days for all FLS,
· Giving FLS the right to receive the special discretionary bonus provided to exempt staff, and
· At the Company’s discretion, improved health care benefits for FLS.


These are in recognition of proposed changes to FLS work terms including:
· Enhancing the Company’s ability to fully utilize each FLS’ talent and abilities to maximize operational and succession planning goals,
· Providing that FLS may not serve in a formal union capacity due to the legally recognized inherent conflict of interest between union and management responsibilities,
· In the case of dismissal without just cause, an FLS will receive either severance of up to 18 months salary or reassignment by the Company to an alternate position in ESSAR Steel Algoma, and
· No overtime up to 48 hours worked in a week, with “C” time or overtime pay at FLS option for hours worked over 48.


Details can be found in Addendum 5, page 33 of the offer.



If you have questions about this offer, email us at intheknow@essar.com and your questions will be answered within 12 hours.

USW Local 2251 Overwhelmingly Ratifies Collective Agreement

USW Local 2251, the union representing hourly employees at Essar Steel Algoma, overwhelmingly ratifies collective agreement. Click here to read the Company statement.

TENTATIVE AGREEMENT REACHED WITH USW LOCAL 2251

The Company has reached a tentative agreement with USW Local 2251, the union representing our hourly employees in Sault Ste. Marie. The USW bargaining committee is unanimously recommending this agreement.

To view the news release, click here.

Essar Spirit Live on Queen

On Saturday morning, Rotaryfest brought a carnival to Queen Street, infusing energy and a spirit of community into the thousands of families and neighbours who lined the street to join in the revelry. There in the midst of this raucous celebration was the Essar Spirit – Live on Queen, moving to the beat of Four Way Stop, a talented team of musicians featuring Essar’s very own Jim Scali, and friends Rick Rogers, Nick Scali and Bob Yeomans. Thanks to the talents of our employees, this year’s entry staged an array of Caribanna-style costumes and musical accessories. Leading the charge were our saxophone toting Jazz Fish, swaying to the tunes of Jimmy Buffet and dodging the spray from our fun loving children who helped to keep the crowd cool with their super soakers. Our spirited team of employees and their offspring were so engaged with the crowd they could easily have kept on going down Queen Street all the way to the Plant gates!

Special thanks to the judges who saw it fit to honour our entry with First Prize Professional. Looking back at the array of photo galleries and video footage from the parade you can’t help but feel the community spirit this event spawns. We were among friends and we have RotaryFest to thank for the experience.

Kudos to the Rotarians who led the charge and brought this community together in celebration, and to the many who lent a hand along the way – we are indebted. Thanks for the memories.

NEGOTIATIONS UPDATE

We are just past the halfway point in bargaining with both USW locals at Essar Steel Algoma. The Company is looking to negotiate agreements that ensure the viability, sustainability and continued success of this operation for many generations to come. It comes as no surprise to anyone who reads the Sault media or follows steel that the financial and operational pressures in the steel industry persist. Not the least among these are the increasingly volatile raw material costs.

These pressures weigh heavy as we go through the process of contract negotiations. Finding the balance between a fair and reasonable settlement that reflects the importance of our employees and the realities of the steel industry is challenging. In spite of this we are working towards achieving fair settlements.

We believe that for both USW locals our proposals reflect these realities.

For USW Local 2251, the Local representing our hourly employees, this means we are seeking ways to optimize productivity and to ensure our competitive performance in an increasingly consolidated, global steel industry. Discussions to date have been constructive in this regard and talks are now moving to monetary issues.

For USW Local 2724, which represents the front line supervisors, technical and professional staff, this also includes making changes that will put us on par with our peers in the industry.

Among the items in our proposals to USW 2724 is the need to amend the work terms for our front line supervisors, who are our front line management personnel, in a way that makes us competitive within our industry. Although we understand how this situation evolved it must be corrected.

We invest a great deal in our front line management personnel and we need to be able to guide their respective career path. Current contractual restrictions within the bargaining unit limit their mobility, creating operating inefficiencies and limiting opportunities for professional development.

There is a tremendous talent pool at ESSAR Steel Algoma Inc. and within the ESSAR Group which all global operations benefit from being able to access. With this in mind, our Local 2724 proposals also contain some provision for shared services and for sharing tasks among the Essar group of companies where it is most economical and makes the most business sense. The revisions we are seeking include safeguards for current employees ensuring no employee job is affected by shared services.

In terms of our competitive advantage, no other competitor is prevented from using the economy of shared services to reduce its costs with appropriate protections for existing employees. What we seek is a level playing field.

These important issues are critical to the ongoing viability of the Company, and they are not going away. The sooner we enter into meaningful discussions with Local 2724 on these issues, the sooner we can arrive at solutions that all parties can support.

Congratulations to our first Scholarship of Excellence Recipients!

Left to Right: Nicholas Turco, Stephen Lajambe, Olivia Christie

Essar Steel Algoma launched its Scholarship of Excellence program in March of this year. This academic initiative is offered to local high school students who will continue their education at university or college upon graduation. Academic performance, community involvement, and extracurricular involvement are the key qualities considered when choosing a successful candidate. First consideration is given to a child, grandchild, or legal ward of an Essar employee or retiree. Most importantly, the Scholarship of Excellence offers students in our community an academically and personally rewarding growth opportunity.

The Scholarship of Distinction is awarded to university bound students while the Scholarship of Merit is given to those who elect the college route. Both are renewable for the term of their degree or diploma, subject to minimum performance requirements.

This year’s call for applicants was met with great enthusiasm and the Scholarship Committee narrowed the candidates down to three special recipients.

Nicolas Turco is a graduate of St. Mary’s College and an Ontario Scholar. With his Scholarship of Distinction he plans to study arts and business at the University of Waterloo in the fall.

Olivia Christie hails from Korah Collegiate where she graduated as an Ontario Scholar and an International Baccalaureate diploma candidate. Olivia will attend the University of Western in the fall, applying her Scholarship of Distinction to her nursing studies.

Stephen Lajambe graduated from Central Algoma Secondary School as an Ontario Scholar. He received the Scholarship of Merit in support of his studies at Cambrian College in the electrical technician program.

Best wishes to Nicolas, Olivia and Stephen as they continue their studies! We look forward to following their progress.

For more information on the Scholarship of Excellence program click here.