The Stel Salaried
Pensioners Organization wishes to thank The Hamilton Spectator for permission
to post the following article by Reporter Tara Perkins in the February 6, 2004
edition
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Feb. 6, 2004. 12:52 AM |
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CEO closes pension plan for execs,
defends 'process' |
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By Tara Perkins |
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The head of Stelco told workers yesterday that an "inappropriate" pension plan that could pay executives more than $870,000 a year has been closed. In a letter to employees, CEO Courtney Pratt said the company began a review of the plan a month ago, before it sought bankruptcy protection. "No new members have been added to the plan since I assumed office one month ago. We have concluded that the plan is inappropriate on a go-forward basis given the current circumstances and we will not be adding any new members." Tim Huxley, vice-president of corporate affairs, said that "fundamentally, what he's saying is, whatever it is sits there and we're going forward. And the issue going forward is, what is the future of the company going to be?" From this point on, Huxley said, executive pensions will be determined using new, yet to be determined, numbers. It's possible that no one would have been entitled to enter the plan in the one month that Pratt has been president, Huxley said. The previous plan entitled executives to $50,515 to $874,705 for 15 to 40 years of service. Huxley would not say if the company intends to negotiate with former executives. Asked about Pratt's compensation, Huxley said he's not aware of the details and does not know if the president is entitled to a pension. Pratt was unavailable for comment. The Stelco CEO said the company isn't targeting pensioners or any other group in its fight to restructure. "We have not singled out and do not intend to single out any one particular group to bear the burden of this exercise, be it employees, bondholders, pensioners, trade creditors or others," the letter said. Pratt said that, had the company not gone into bankruptcy protection, the steelmaker and all its employees would have been jeopardized. "We initiated this process because of our high overall cost structure, our deteriorating cash position and our inability to compete against other steel producers that have benefited from their own restructurings," the letter said. "His process is to use the CCAA (Companies' Creditors Arrangement Act) to convince the union to give up their wages and pensions," said Rolf Gerstenberger, head of the United Steelworkers of America Local 1005. In his letter, Pratt said the company learned from media reports that the union is about to legally challenge the company's bankruptcy protection, Pratt said in the letter. Gerstenberger said the last time the union met with Pratt was Dec.12. tperkins@thespec.com 905-526-4620 |