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U.S. Steel lays off more workers at Gary Works

U.S. Steel laid off 38 maintenance workers Friday at Gary Works.

U.S. Steel laid off 38 union workers at Gary Works on Friday, but the union will fight it, said Mike Millsap, United Steelworkers District 7 director.

Steelworkers said the laid off maintenance staff were escorted out of the sprawling mill in Gary, U.S. Steel’s largest and the biggest integrated mill in the United States.

U.S. Steel spokesman Sarah Cassella declined to comment.

It’s just the latest round of layoffs at the troubled steelmaker, which lost $1.5 billion last year and has failed to turn a profit in five of the last six years. U.S. Steel laid off about a quarter of its salaried workforce — roughly 750 managers, supervisors and other white-collar workers — in April.

U.S. Steel laid off more than 1,000 workers in Northwest Indiana — both union and salaried — last year.

Friday’s layoffs came after Chicago-based consulting firm McKinsey & Co. concluded Gary Works had too many maintenance employees and recommended layoffs to cut costs, Millsap said.

“Under the contract, they can only lay off workers under certain conditions,” he said. “We believe these maintenance people are needed. We’ve got a process, and we’re going to fight them on this.”

U.S. Steel and McKinsey & Co. want to rely more on outside contractors, an idea the union opposes because of safety concerns, Millsap said.

“They don’t just repair equipment,” he said. “They do a lot of maintenance and work on safety issues. They do a lot of preventative safety. A lot of things won’t get done if we reduce this staff.”

USW Local Union 1014 President Rodney D. Lewis Sr., who represents the Gary Works steelworkers, recently posted an open letter on Facebook criticizing U.S. Steel for paying too much for consultants while freezing managers’ pensions and fostering low morale.

“So here we sit. The butcher that initially put his arms around the hog offering a helping hand is preparing a meal,” he wrote. “All indicators are showing us that pork is now on the menu. I hope you’re happy. I certainly am not.”

Millsap said the union would first try to talk to U.S. Steel management and then appeal the layoffs to an independent arbiter.

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Business Reporter

Joseph S. Pete is a Lisagor Award-winning business reporter who covers steel, industry, unions, the ports, retail, banking and more. The Indiana University grad has been with The Times since 2013 and blogs about craft beer, culture and the military.