KAISER RETIREES COULD HAVE BENEFITS REDUCED - Ormet Chemical Declares Bankruptcy

(02/02/2004)

Kaiser Aluminum and Chemical and the United Steelworkers of America have agreed to modify their longtime labor contracts. The agreement will reduce benefits received by retirees. Some of those retirees worked at the Ravenswood Aluminum plant when Kaiser was still the operator. The agreement will continue to provide pensions and medical benefits, but at reduced levels. Kaiser Aluminum is attempting to recover from its bankruptcy. Kaiser Aluminum operated the plant for nearly 30 years, before selling it in 1989 to Ravenswood Aluminum. The new agreement must be ratified by a vote of Kaiser Aluminum's union members, approved by Kaiser's board of directors and by the bankruptcy court. The agreement will cover about 1,200 active workers at six company plants and as many as 2,000 retirees. It will affect a considerable number of retired workers in this region. Company representatives lashed out at the insurance industry and America's health delivery system, saying private businesses can no longer assume the payment of health insurance costs. Currently, American business pays about 40% of health care costs. A second large employer in the Ohio Valley has announced it is declaring bankruptcy. Ormet Corporation of Hannibal, Ohio announced it was laying off 300 Ohio workers less than an month ago. It is now filing Chapter Eleven. The aluminum maker says it's been hurt by low metal prices, weak demand, high energy costs and rising medical benefit costs.

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