U.S. Steel Sale to Nippon Can Move Forward, Arbitration Board Rules

Both former President Donald Trump and Vice President Kamala Harris have campaigned against the deal.

SEATTLE (Scrap Monster):  A board of arbitrators ruled the sale of U.S. Steel to the Japanese company Nippon can move forward, a decision with which the United Steelworkers union said it 'strenuously' disagrees. 

The board of arbitration, which is selected by U.S. Steel and the United Steelworkers to decide disputes between the two, ruled that the company has met the conditions of the successorship clause under its basic labor agreement. 

Union leadership filed a series of grievances in January and the arbitration board heard evidence and arguments from both the union and the company in August.  

The board decided that Nippon Steel has recognized the United Steelworkers as the bargaining representative for union employees and has assumed all agreements applicable to those employees. 

Arbitrators also determined that Nippon has 'provided reasonable assurances that it has both the willingness and financial wherewithal to honor the commitments in the agreements between U. S. Steel and the USW applicable to USW-represented employees,' U.S. Steel said. 

The board cited Nippon's written commitments, including a promise not to conduct layoffs during the term of the contract and to invest $1.4 billion in union-represented facilities.  

But in a statement, the United Steelworkers say arbitrators accepted Nippon's promises at face value, 'despite the obvious means by which it's using its North American holding company to insulate itself from our contracts.' 

'Nippon's commitment to our facilities and jobs remains as uncertain as ever, and executives in Tokyo can still change U.S. Steel's business plans and wipe them away at any moment,' the union said. 

In a news release, U.S. Steel CEO David Burritt said the company looks forward to moving forward with the arbitration process now complete. 

'With the significant investments and contractual commitments from Nippon Steel, we will protect and grow U. S. Steel for the benefit of our employees, communities and customers. We look forward to collaborative discussions with the USW and all our stakeholders,' said Burritt. 

Sale to Nippon faces opposition

While U.S. Steel says no further action is required under the basic labor agreement to move forward with closing the sale, the merger faces opposition from President Joe Biden.

Multiple news outlets have reported that Biden plans to block the deal as soon as he receives a decision from the Committee on Foreign Investments in the United States, or CFIUS. But the White House has downplayed those reports, saying CIFUS is reviewing the deal for potential national security concerns and could advise against the merger.

The United Steelworkers pointed out that the board of arbitration noted the merger 'may not happen at all due to the lack of governmental approval.'

Both former President Donald Trump and Vice President Kamala Harris have campaigned against the deal. 

But U.S. Steel has warned that without the merger, thousands of jobs are at risk. And if the sale falls through, U.S. Steel says it 'raises serious questions' about keeping its headquarters in Pittsburgh. 

The $15 billion sale to Nippon Steel, Japan's largest steelmaker, was announced in December.  

Courtesy: www.cbsnews.com

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