Steelworkers Seek Reinstatement of Retiree Health Benefits

TORONTO – As U.S. Steel Canada spends millions on bonuses and salary increases for company management, the United Steelworkers (USW) filed a motion in Ontario Superior Court today seeking reinstatement of crucial health benefits for thousands of retirees.

The USW also filed a motion asking the court to reject U.S. Steel Canada’s plan to spend another $1.57 million on bonuses to managers, which would be the second round of management bonuses since the company sought bankruptcy protection.

“It’s unconscionable that U.S. Steel management can stuff their pockets while health benefits have been taken away from our pensioners – the most vulnerable group affected by this restructuring process,” said Bill Ferguson, President of USW Local 8782 at U.S. Steel’s Nanticoke operations.

“We’re saying the court must recognize that this company has a moral and contractual obligation to restore health benefits that belong to pensioners.”

“Paying out bonuses to management while thousands of pensioners have been suffering for nine months is unacceptable,” said Gary Howe, USW Local 1005 President in Hamilton.

“Our retirees feel cheated. These benefits are deferred wages that they negotiated, that they earned over a lifetime of work in conditions that compromised their health. They desperately need these benefits and the company can now well afford to pay them,” Howe said.

Health benefits for 20,000 pensioners and surviving spouses were suspended late last year when U.S. Steel Canada was granted approval to eliminate the benefits by the judge overseeing restructuring proceedings under the Companies' Creditors Arrangement Act (CCAA).

“We hear terrible stories every day from retirees who are unable to get the medical services and supplies they require,” said USW Ontario Director Marty Warren. “Their benefits can and must be reinstated immediately.”

The USW’s motion for reinstatement of retirees’ Other Post Employment Benefits (OPEBs) cites numerous examples of the suffering and hardships of retirees with debilitating and life-threatening illnesses and health problems.

“The abrupt suspension of OPEBs caused significant hardship,” states an affidavit sworn by Tony DePaulo, Assistant to the USW Ontario Director. “Retirees were in the middle of receiving treatment for cancer for which drugs were not covered” by government programs.

“These retirees were faced with the prospect of an earlier death or more complications from cancer, simply because they could not afford necessary prescription medication,” DePaulo states.

“The suspension of OPEBs has caused great emotional distress to the retirees. The retirees earned their OPEBs through deferred wages. They were promised that they could rely on having OPEBs in their old age and illness ... It has been immensely upsetting that a court could suspend benefits guaranteed through the collective agreement.”

The USW welcomed news this week that the Ontario government is extending a ‘transition fund’ to help pay for some urgent medication and treatments for the most-vulnerable U.S. Steel retirees.

However, it is crucial for the OPEBs to be reinstated because the government funding is limited and eligibility criteria are “very restricted,” leaving many retirees facing more suffering and hardship, DePaulo states in his affidavit.

“The USW has seen the suffering of its retirees and heard their stories every day.  We see retirees who have exhausted all of their savings and who must now scramble to try find the money to buy the prescription drugs they desperately need. We see retirees who are going without their medication, their treatments and the tests they need, because they cannot afford the cost.

“Given the hardship experienced by the retirees, it is virtually inconceivable to them that USSC has given management bonuses and salary raises at a time when it has claimed OPEBs must be suspended because it cannot afford to pay for the benefit.”


For further information:

Marty Warren, USW District 6 Director, 416-243-8792
Tony DePaulo, Assistant to USW District 6 Director, 905-869-0760, tdepaulo@usw.ca
Gary Howe, President, USW Local 1005, 905-531-4078, gary.howe@uswa1005.ca
Bill Ferguson, President, USW Local 8782, 905-537-8782, president@uswa8782.com
Bob Gallagher, USW Communications, 416-434-2221, bgallagher@usw.ca

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