July 25, 2006 — Arbitrator Jerry Fullmer has ruled in favor of United Steelworkers Local 9447-5 in the case for profit-sharing payments by Gerdau-Ameristeel according to the labor agreement at the company’s Calvert City, Ky., facility.

Gerdau-Ameristeel assumed the existing labor agreement — which had been in place since March 2002 — when it acquired ownership of North Star Steel’s Calvert City plant on Nov. 1, 2004. The agreement requires profit-sharing to be paid, based on four percent of before-tax profits. However, Gerdau claimed the profit-sharing program was discretionary and refused to pay it, indicating that it wanted to treat its union workforce the same as workers in its non-union plants.

Arbitrator Jerry Fullmer's ruling said that Gerdau's refusal to pay the profit-sharing was a violation of the labor agreement. According to the ruling, back pay, estimated at more than $2 million, must be paid to the 120 USW members within 60 days. Fullmer also ruled that Gerdau must also cease and desist from violating the contract any further by refusing additional profit-sharing payments.

"Our members are ecstatic with this victory," said Brian Graves, President of the local union. "We worked hard to make these profits and Gerdau tried to deny our share. Our members have never been more proud to be part of this union. This decision, more than anything, shows the difference in union workplaces and non-union shops."

USW labor agreements have expired at seven Gerdau locations, including three Sheffield Steel plants recently acquired by the company. These locations include Beaumont, Texas; St. Paul, Minn.; Wilton, Iowa; Perth Amboy, N.J.; and the three Sheffield Steel plants at Sand Springs, Okla.; Joliet, Ill., and Kansas City, Mo.

The USW represents some 3000 Gerdau employees at 13 locations in North America.