AK Steel (NYSE: AKS) said that members of the United Steelworkers (USW) Local 1865 union have ratified a three-year extension to a labor agreement covering about 750 hourly production and maintenance steel operations employees at the company's Ashland (KY) Works. The new agreement extends the existing contract to September 1, 2013. The existing contract was scheduled to expire September 1, 2010.
AK Steel said it was notified by USW officials that the contract extension passed in voting held today in Ashland. The terms of the extension are effective as of July 1, 2010.
AK Steel said the contract extension also contains new language which allows the company flexibility in operating the Ashland Works to meet market conditions while committing significant capital investments in the steelmaking plant, in particular the blast furnace.
The contract extension also provides lump sum payments of $1,500 to each represented employee covered by the contract in 2010, 2011 and 2012. In addition, the standard hourly wage rates will be increased by $1.00 in September of 2010.
"We are pleased to have reached agreement on this extension contract which also provides AK Steel with operational flexibility and the employees of the Ashland steel plant with a wage increase and our commitment to provide significant capital improvements," said James L. Wainscott, Chairman, President and CEO of AK Steel.
Hourly production and maintenance employees of the Ashland coke plant are covered by a separate labor agreement which runs through October 31, 2011.