March 15, 2007 — Members of the International Association of Machinists and Aerospace Workers (IAM), Local Lodge 1943, have ratified a new-era labor agreement at AK Steel’s Middletown, Ohio, facility. The new contract was passed by an overwhelming 85% favorable vote, according to IAM reports.

Covering about 1,700 hourly production and maintenance employees, the new 54-month agreement replaces the last of AK Steel's labor contracts that originated prior to the steel industry's significant restructuring and wave of progressive new labor contracts over the last several years.

The new Middletown Works contract includes, among numerous other provisions, competitive wage increases, as well as a lock and freeze of the traditional defined-benefit pension plan, replaced by a $1.50 per-hour company contribution to the IAM's multi-employer pension plan, increasing to a $1.80 per-hour contribution over 36 months. As a result of the new agreement, the Middletown workforce will undergo a complete restructuring, with the number of job classes to be reduced from the previous 1000 down to only seven. The minimum base workforce guarantee has been eliminated, and active employees and future retirees will share in healthcare costs.

The new agreement takes effect March 15, 2007 and runs through September 15, 2011. AK Steel said the return-to-work agreement would be implemented immediately and that all eligible returning IAM members would be scheduled to work within 90 days or less.

"We are pleased that we have reached an equitable agreement which will return IAM members to work with a contract that significantly improves Middletown Works' competitiveness," said James L. Wainscott, Chairman, President and CEO of AK Steel. "The labor dispute in Middletown is over, and we look forward to the quick return of IAM members."

This ratification marks the 11th new-era labor contract reached between AK Steel and the three international unions that represent the company's hourly workforce.

AK Steel produces flat-rolled carbon, stainless and electrical steel products, as well as carbon and stainless tubular steel products, for automotive, appliance, construction and manufacturing markets.