The Stel Salaried
Pensioners Organization wishes to thank The Hamilton Spectator for permission
to post the following article by Reporter Steve Arnold, published in the March
15, 2006 edition
By Steve Arnold
The Hamilton Spectator
(Mar 15, 2006)
The union leader who dismissed Stelco's tortured bankruptcy
process as a fraud and sham is facing a re-election challenge from his own
vice-president.
Rolf Gerstenberger, who as president of Local 1005 of the
United Steel Workers of America refused to take part in Stelco's restructuring,
faces a local election on April 3. He is being challenged by Jake Lombardo.
As Gerstenberger fights to keep leadership of Local 1005,
unionized workers at Stelco's Lake Erie plant acclaimed Bill Ferguson to
another three-year term as their president Monday -- years he said will be
tough as the company makes the transition from court protection to full-market
player.
"The next three years are going to be the challenging
phase of the restructuring," he said. "It's time for us to start
looking forward. We're past the bankruptcy and we have tomorrow to deal with
now."
Ferguson and Gerstenberger have presented a sharp contrast
through Stelco's 25-month journey through court-supervised restructuring. In
the early stages, they were united in trying to get the process declared
invalid, but when that failed, Ferguson took an active role in negotiating the
future while Gerstenberger stayed on the sidelines.
For him, the company's existing collective agreement and
current labour law were the only rules dictating how he would deal with the
company.
That contract expires July 31 and with bankruptcy protection
slated to end March 31 and a new president ready to take the helm of the
company, McMaster University business professor Marvin Ryder says union members
face a tough choice.
"This is clearly a new era for Stelco and the early
signals from the new president are it's not going to be business as
usual," he said.
"If I was voting as a rank-and-file member now, I'd be
a little bit worried and want some strong leadership, but I'd also want
leadership that's prepared to come to the table with an open mind," he
said. "It's not your grandfather's union any more. The steel industry is a
modern business with some very interesting global pressures operating in a
dynamic global market place."
Another factor in the union election is the need for a
leader who can work with Stelco's new president -- steel industry veteran
Rodney Mott. Along with billionaire investor Wilbur Ross, he worked for three
years to assemble International Steel Group in the United States by cobbling
together bankrupt steel plants.
"Stelco has brought in a real superstar here,"
Ryder said. "It's like they've recruited Wayne Gretzky."
Mott has said he hopes union leaders will "step up and
be business partners with us" in reshaping Stelco, with increased
productivity from Hilton Works a key part of that.
In a related announcement yesterday, Stelco confirmed its
new shares will start trading on the Toronto Stock Exchange April 3. Tricap
Management Ltd. will own about one-third of the new stock while hedge funds
Sunrise Partners LP and Appaloosa Management LP will split a stake of about
34.9 per cent. The shares will have an initial value of $5.50 a piece.
Stelco will also be in court in Toronto tomorrow seeking an
order allowing the monitor to release $124.6 million earned by selling its
subsidiaries, including the Stelwire plants in Hamilton and Burlington as well
as other companies in Quebec and Alberta.
Stelco filed for bankruptcy protection on Jan. 29, 2004,
citing mounting losses and the crippling cost of funding its pension plan
deficit. With money from the investment funds and federal and provincial
governments, its finances have been restructured without concessions from
workers or retirees. Debtholders will get about 66 cents on the dollar.
sarnold@thespec.com
905-526-3496