Arconic and United Steelworkers are negotiating a labor contract for the first time since Alcoa broke itself apart in 2016 — and around one year before the company plans to once again split itself in two.
United Steelworkers is negotiating a labor contract for 3,300 employees, including around 1,900 at Davenport Works, ahead of the May 15 deadline and before the aluminum manufacturer plans a breakup in 2020.
Members of United Steelworkers Local 105 in Bettendorf picketed outside of the Davenport Works plant Thursday afternoon, raising signs and chanting for a fair contract.
"We just want to stand up and make sure Arconic keeps its promises to our retirees, and that they still provide good wages and good benefits — not only to our current members but for future members," said Roy Hutt, a union representative. "We want to tell the community that we have good jobs here, and to tell the company that's what this community deserves."
The contract affects employees across four locations: Davenport, Iowa, Lafayette, Ind., Alcoa, Tenn., and Massena, New York. Talks began April 29 at the headquarters in Pittsburgh, to replace the previous five-year contract.
"We are negotiating in good faith with the USW, working collaboratively to find mutually beneficial ways to improve our business’ competitiveness and maintain a sustainable future," said Davenport Works spokesman John Riches.
The negotiations follow several moves by Arconic to scale back benefits for non-bargained employees and retirees. In the past year, Arconic has announced it would freeze U.S. pension plans, end pre-Medicare health coverage and reduce health care benefits, for example.
Hutt said wages and benefits are primary discussion points during contract talks.
"They've pulled the rug out from retirees that are salaried, changed benefits after they're retired and taken away some wages. They want to do the same thing to us, and we're saying 'no,'" he said. "This community needs these jobs. These are some of the best in the area. It's a very sought out job."
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There's still much uncertainty regarding the future of Arconic, following the announcement in February the company will spin off its two main business units next year. The aluminum manufacturer has said one company will make rolled-aluminum panels for the auto industry, while the second will produce parts for aerospace companies, according to the Wall Street Journal.
Davenport Works is a part of Arconic's Global Rolled Products business segment, which manufactures aluminum sheet and plate for the automotive, aerospace, commercial transportation, brazing and industrial markets.
Arconic has invested millions in the Davenport Works plant in recent years, including installing a nearly $150 million thick plate stretcher in 2017.
Despite the company splitting again, Hutt said he doesn't believe the forthcoming changes are affecting negotiations.
"It's just more wasteful money spent by the company when they could be putting more money within our plant. That's all it means for us," he said. "In my opinion, it takes a lot of time to do these negotiations, and that's on both sides. So I hope it'll be another five-year contract."
Hutt pointed out Arconic has had four CEOs since 2017, and now plans to appoint two chief executives ahead of the break next year. The company announced earlier this month it will repurchase $200 million of Arconic's common stock, following a $700 million stock buyback a few months ago.
"All of the (contract) proposals up to this date have been concessionary, and we feel there's really no reason for it," he said. "Five years ago, we negotiated with Alcoa and were able to get a fair contract. We're hoping for the same this time, but Arconic is a little bit different. All we know is they're pretty much proposing cuts across the board."
Hutt did not provide specific details about what United Steelworkers are requesting in the new labor contract.
There has not been a strike during union negotiations since 1986. In the event of a work stoppage, Arconic would continue to operate the plant with salaried employees and outside resources.
If an agreement is not reached by Wednesday's deadline, both sides could approve an extension.