United States Steel is disputing the United Steelworkers’ allegations that the steelmaker breached its labor agreement with the union by failing to provide information about critical developments of the company’s sale to Nippon Steel.
The Pittsburgh-based manufacturer said it repeatedly reached out to the USW during the company’s strategic review before the sale, but says it couldn’t share more information because the union chose not to sign a nondisclosure agreement.
U.S. Steel’s agreement to sell itself to the Japanese steel-maker has turned into a political football, with key politicians and opponents of the deal seizing on the union’s claims that U.S. Steel didn’t comply with the labor agreement.
The steelworkers can’t block the deal themselves, but they hold a significant amount of sway in the American political arena as they represent a wide swath of blue-collar workers in critical swing states with whom American voters can identify heading into election season. President Joe Biden’s administration can cancel deals with the stroke of a pen through a review by the U.S. Committee on Foreign Investment — a process former President Donald Trump used during his administration to boost his bona fides supporting domestic industries, claiming it pertained to national security interests.
"At the beginning of and throughout the strategic alternatives review process, U.S. Steel repeatedly reached out to the United Steelworkers (USW), per the terms of our Basic Labor Agreements, and provided the opportunity to sign a customary NDA,” Amanda Malkowski, a spokeswoman at U.S. Steel, said in an email to Bloomberg News. "Confidentiality is critical to the integrity of any sale process, and we shared information with the USW as soon as it was feasible.”
The steel-maker said the labor union’s decision to assign its right to bid to competitor Cleveland-Cliffs Inc. created confidentiality challenges. The company said it’s customary for parties to sign NDAs in order to share inside information regarding a potential sale.
The company’s response comes a week after the union posted a note on its website saying that neither U.S. Steel nor Nippon Steel contacted the labor group before the announcement that the Japanese company would buy the iconic producer for $14.1 billion and create the world’s largest steel company outside of China, calling it a violation of "many sections” of their labor agreement. USW President Dave McCall said in an interview Friday that the union has an ongoing confidentiality agreement with U.S. Steel contained within the most recent collective-bargaining agreement to which the two sides agreed.
"When they sent us a new revised one, they wouldn’t even allow us to talk to our members about this process, and we told them we already have a confidentiality agreement so we don’t have to do anything more,” McCall said.
Relations between the USW and U.S. Steel, two parties with nearly a century of history between them, have been strained since the beginning of the process. In addition to the labor pushback, lawmakers and investors have focused attention on the deal clearing a CFIUS review by regulators. U.S. Steel is proactively seeking review from the Biden administration as a condition of its sale.
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