Since September 1997, union workers have been locked in a bitter labor dispute with Oregon Steel, the Portland-based parent company of the plant.
Most of the approximately 1,100 workers, who belong to United Steel Workers of America, lost their jobs when they went on strike for the last three months of 1997. Oregon Steel replaced strikers at Rocky Mountain Steel Mills, formerly CF&I, with non-union workers at lower wages.
In February 1998, USWA filed a 25-page complaint with the National Labor Relations Board charging the company with more than 130 violations of fair labor practices.
Last January, the NLRB, the federal agency which mediates disputes between employers and unions, upheld approximately all but ten of those complaints.
Oregon Steel has vowed to appeal all unfavorable rulings, but if the NLRB verdict is upheld -- as happens roughly 80 percent of the time -- it will be a momentous victory for the union.
According to Jeanne Landreth, a union member and mother of four who began working at CF&I in 1975, "This fight isn't just about CF&I. It's about the bottom-line mentality governing corporate America. We're fighting for your job, too, for the future of all working-class Americans."
If upheld, Oregon Steel will be obligated to restore all union members their former jobs with full back pay and benefits -- an amount approaching $1 million a week since the beginning of 1998.
But Oregon Steel CEO Ray Adams insisted his company "never engaged in unfair labor practices.
"Nobody, here, is really at fault," he said. "We just want to run our business."
Oregon Steel purchased CF&I in 1993, when the plant was bankrupt.
Spending millions to modernize the mills, Oregon Steel restored operations to profit levels in excess of industry standards. Productivity doubled between 1995 to 1997 and operating income more than doubled in the first three quarters of 1997.
It took Oregon Steel only four years to parlay its $22 million investment into a company worth $146 million, a 657 percent increase. At that point, the Pueblo operation accounted for nearly 70 percent of Oregon Steel's profit.
Employee pay, however, remained roughly $2 an hour below industry averages, and there were widespread complaints over excessive amounts of forced overtime -- some working 12-hour days for months at a time without a day off. Some employees alleged being required to work 24 hours at a stretch -- allegations Oregon Steel didn't deny.
With these issues at the fore, neither side was close to agreement when labor contracts expired in September 1997. On October 3, union workers went on strike.
Nearly two months later the union offered an unconditional return to work, but by then there were only 27 jobs left, the company having filled them with non-union workers at lower pay. (Federal fair labor laws dictate that an unconditional return to work means restored jobs to all union members. The replacement workers, though, remained in place.)
In its 115-year history, the CF&I mills have weathered two national depressions and two bankruptcies under eight different groups of outside owners.
The plant has been a significant part of the Pueblo economy, employing as many as 10,000 in the 1960s.
The following decade, increasing foreign competition and obsolescing technology sent the entire American steel industry into decline and work rolls dropped to 1,900 by 1985.
This left the then-parent company, Crane Corp., with a huge problem. There were four retirees for every active worker, resulting in an enormous pension-funding liability. Facing a liability of $140 million, Crane declared bankruptcy in 1990.
When, by 1992, that liability had soared to $270 million, assets and liabilities were assumed by the Pension Benefit Guaranty Corporation, which made CF&I more attractive to potential buyers. Oregon Steel bought the plant in 1993 for $22.2 million.
With profits soaring, in 1997 union membership at CF&I insisted that they deserved a bigger piece of the pie than Oregon Steel was serving.
Workers, they noted, had accepted a $50- million cut in wages and benefits to help save the plant in the early 1990s, and were paid below industry standards.
Oregon Steel countered that CF&I wages had increased 24 percent from 1993 to 1997 (the average CF&I salary was $46,000), and that the company was in competition with Japan and Korea, who pay their workers substantially less than their U.S. counterparts.
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Neither side has shifted from the position taken at the time of the 1997 strike, and the outcome of Oregon Steel's appeal of the January 1999 NRLB ruling will be momentous for both sides.
The union holds this dispute has cost Oregon Steel upwards to $41 million in revenues and foregone profits, with stock dropping from a high of $29 a share to around $7 a share at present.
Oregon Steel CEO Ray Adams disputes this, however.
"The strike had a significant economic impact at first," he conceded. "But it's having no impact whatsoever today."
However, Ellen Golembek, Secretary General of Colorado AFL-CIO, said the issue potentially affects all workers.
"People need to realize that unions provide workplace protections," she said. "Your boss can fire you or replace you at will. Unions help to solidify the middle class, which supports the tax base."
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