Names of RG Steel ‘key employees’ released
Names of the 21 RG Steel employees described previously as “non-insiders” but who the company says are “key employees” were made public recently with a supplemental filing announcing the deadline for objections, and setting the subsequent hearing date on the initial motion.
The proposal is drawing objections from political representatives and labor unions alike, particularly on the point of it including funds to pay for healthcare – something the now unemployed steelworkers, former RG employees, previously saw covered through their collective bargaining agreements.
Officials for the United Steelworkers, the labor union representing the displaced workers who had worked at RG’s various mills, have called the proposal “an inappropriate, unfair and outrageous effort.”
The company’s request is separate from an earlier plan, which was approved by the court, authorizing up to $20 million in bonus payments to 10 of the company’s executives.
The proposed plan is built on offering 21 people three month’s salary each and $2,000 monthly stipends to cover the cost of purchasing health insurance – a perk previously covered for them by the company.
A court established deadline for filing objections to the plan is 4 p.m. Thursday.
A hearing on the original motion is set for 2 p.m. Tuesday, Nov. 20.
This group of “key” employees are essential to the business RG has to conduct through the end of the year if it is to see it realized to its full financial potential.
RG Steel’s attorneys contend the company needs the employees’ expertise to wind down its estate.
Without the proposed plan, the workers would at best “be less motivated to undertake the substantial responsibilities that they have been asked to undertake in connection with the ‘wind-down process,’ and at worst, would leave the debtors’ employment entirely,” said RG Steel’s filing.
The union called the move a “slap in the face” to “steelworkers and retirees still owed monies for unpaid vacation, severance, medical claims and other broken promises.”
One recently re-elected politician, Jack Cera, has made his objections to the plan official by putting his opinion of the matter into the court record.
“As the State Representative for the counties in Ohio which are home to RG Steel facilities, I am writing to express my concern over the recommendation to provide a ‘key employee retention plan’ for a certain few employees of RG Steel who remain in place as the company liquidates. The bankruptcy of RG Steel has devastated families and communities in my district. Many are left struggling to find and pay for health care coverage for themselves and their families. These workers include members of the United Steelworkers of America and local management employees,” said Cera, State Representative, 95th District.
“According to The Times Leader newspaper, which quotes the motion filed by the court’s reorganization officer, “those same employees would be less motivated to undertake the substantial responsibilities they have been asked to undertake in connection with the wind-down process, and at worst, would leave the debtor’s employment entirely,” and “would hinder the debtor’s ability to realize the full value of their remaining assets” in light of the fact that the assets were sold, including Mingo Junction and Martins Ferry plants, at basically scrap prices far below what is reasonable.”
“The State of Ohio and the federal government had invested millions of dollars in the facilities over the years and both were sold for less than what these governments had invested in these plants.
“Providing health care to the former RG Steel employees, both union and management, in my district is one of the most difficult issues we face in light of this bankruptcy. For the court to permit payment for healthcare for a few top tier executives while the government must try to provide healthcare to all other RG Steel employees is blatantly unfair and should not be permitted. I appreciate the complexity and difficulty of this issue, but would hope that the court would also see how allowing healthcare for these executives while ignoring the local workers is just not right,” said Cera in his filing with the court.
On Oct. 25 the Debtors filed the Debtor’s Motion for Order Approving Key Employee Retention Plan Supplemental Exhibit filed on Oct. 29 listing proposed participants in the proposed key employee retention plan.
Loccisano can be reached at email@example.com