New York (CNN Business)Mine workers have been on the picket line outside of two mines owned by Warrior Met Coal in rural Alabama for the last seven months, waging one of the longest US strikes this century.
On Thursday they brought that protest to the streets of New York City.
Six members of the United Mine Workers of America were arrested for disorderly conduct in New York City Thursday as part of a rally in front of the Manhattan offices of BlackRock, the powerful asset manager that holds $167 million worth of the mining company’s stock on behalf of clients. That 14% stake in Warrior Met Coal (HCC) makes BlackRock (BLK) its largest shareholder.
Nearly 1,000 miners have been on strike against the coal company in Alabama since April 1, after union members voted down a contract they say does not make up for lost income they incurred in their previous contract from 2016.
“These workers have had enough of this,” said Cecil Roberts, president of the United Mine Workers of America, who was among those arrested Thursday at the rally. “We’re not asking for something outrageous. We’re not wanting to be millionaires or anything like that. They’re basically wanting to get back to where they were five years ago.”
Several dozen workers were bused in from the Alabama picket line. One of them is third-generation coal miner Brian Kelly, who was also arrested Thursday.
“I’m on strike for my family and for my brothers and sisters in the mines. We go down there, it’s a dangerous job, put your life on the line,” said Kelly. The mines reach 2,000 feet underground, making them the deepest coal mines in North America, according to the union.
“We love our jobs, but we’re not getting any respect, we’re not getting any time off — we get Thanksgiving off, Christmas Eve and Christmas as far as holidays — the rest of the holidays we have to work while our families are celebrating holidays,” Kelly said.
Workers flexing muscle
The strike is just one of the many signs of unions flexing their muscle around the country. With employers having difficulty hiring workers, union members are demanding what they see as their fair share from companies that are doing well financially.
On Tuesday 10,000 striking members of the United Auto Workers at John Deere (DE) rejected a second tentative labor agreement, extending the strike that started October 14. The rejected deal would have given them an immediate 10% raise, an $8,500 signing bonus as well as other raises and improved benefits during the life of the contract.
On Wednesday 3,000 student workers at Columbia University in New York City, including graduate students working as instructors, went on strike.
About 1,400 workers are also striking at Kellogg. And data from Cornell University’s labor studies department counts 200 strikes so far this year, including 38 that started in October alone, the most of any month this year. Nearly 29,000 workers have gone on strike so far in 2021.
The Warrior Met Coal strike has halted operations at one of the two mines the company operates in Alabama, and has limited operations at the other. But the company continues to extract coal at one of the mines using management staff and 200 hourly workers who are willing to cross picket lines and report to work.
The company’s most recent financial report shows production is down 40% in the three months ending September 30, compared to a year ago. But coal prices have more than doubled during that time, allowing Warrior Met Coal to ride out the loss of production.
The coal mined by the company is used for steel mills, not power plants. And all of its coal is shipped to overseas mills, not the US mills that still make steel out of raw materials rather than melted scrap steel.
Demand driving prices
Coal prices are up significantly because of trade tensions between Australia and China, which has resulted in an unofficial ban by China on Australian coal imports. Chinese steel mills are a major consumer of the kind of coal that Warrior Met Coal ships.
But while it is expected that prices will fall once Australia is able to ship coal to China again, company officials say that they believe strong demand for steel worldwide means Warrior Met Coal’s profit outlook is good.
“We recognize that the likelihood of pricing reset is high,” CEO Walter Scheller told investors this week. “However, when a reset does occur, we expect pricing to remain above historical averages due to the strong market fundamentals.”
The company said that the strike has cost it $16.2 million in increased costs in the most recent quarter, not counting lost sales from reduced production from the closed mine. But it said it should be able to meet customer demands for its coal even with one of the mines shuttered.
BlackRock declined to comment on the protest. Warrior Met Coal officials defended their position on the strike, saying that it values and appreciates its employees’ hard work, but that it needs to contain costs in order to remain financially stable in a volatile coal industry.
But the company is clearly doing very well in the current market with the price for its coal at record highs. And its financial success is a key factor in the strike.
The previous owner of the mine, Walter Energy, filed for bankruptcy in 2015 due to a steep drop in price of coal. The union says it agreed to deep concessions, including reduced pay, with workers having to pay more for health insurance and cutting health benefits for 2,500 retirees, along with changes in retirement benefits in order to help the company emerge from bankruptcy. The union says the average hourly wage for workers at the mine is now $23 an hour, down $6 an hour from their pay before the bankruptcy.
Those concessions have saved the company a total of $1.1 billion since it emerged from bankruptcy through the formation of Warrior Met Coal, according to the union.
But the company said it doesn’t believe it should have to restore the pay and benefits the workers previously received.
“When the 2016 collective bargaining agreement was negotiated, no representative of Warrior Met Coal ever indicated to the union in any way that specific terms of any previous contract under which they had worked would be restored in future contracts,” said D’Andre Wright, the company’s vice president for external affairs. “Our priorities have always been keeping people employed and working safely with long-lasting careers and ensuring the company remains financially stable in a particularly volatile coal market.”
He said the company’s employees are among the top 10% of wage earners in Alabama, and that employment at the mine has tripled since 2016. That means that 60% of the current workforce were not working at the mines under the earlier, more lucrative contract, he said.
Strikers are getting union strike benefits of $400 a week, less than half of what they earned from a 40-hour week. Some are able to find temporary employment to help supplement their incomes, even if those jobs don’t pay as well as their mining jobs.
The union says a recent court order keeping strikers at least 300 yards away from the entrance to the mines constitutes an improper elimination of members’ “free speech rights and freedom of assembly.” It said that is why it is moving its protest to BlackRock’s New York offices.
Warrior Met Coal says the court order was justified by picket line violence, and posted a video showing vehicles being hit by picketers and windows being broken in buses carrying non-striking workers past the picket lines.
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