United States Steel Corp. (X) announced on Wednesday that the Board of Arbitration has ruled that the company has met all conditions stipulated in the successorship clause of its Basic Labor Agreement (BLA) with the United Steelworkers (USW). Consequently, no further actions are required for the ongoing transaction between U.S. Steel and Nippon Steel to proceed.
In January 2024, USW leadership filed grievances claiming non-compliance with the successorship clause in the BLA. However, following a hearing on August 15, 2024, where both U.S. Steel and the USW presented evidence and arguments, the Board of Arbitration determined that U.S. Steel had satisfied the clause's requirements.
Per the BLA, Nippon Steel has acknowledged the USW as the bargaining representative for USW-represented employees at U.S. Steel, given reasonable assurances of its capacity to honor the agreements with the USW, and assumed all applicable agreements for those employees.
The Board of Arbitration recognized Nippon Steel's repeated written commitments to fulfilling the successorship clause, concluding that no further actions were required. These commitments included an investment of at least $1.4 billion in USW-represented facilities, a pledge against layoffs or plant closures during the BLA term, and a commitment to protect U.S. Steel's interests in trade matters.
With the arbitration concluded, all outstanding issues concerning the BLA related to the transaction have been resolved.
Earlier this month, U.S. Steel employees rallied in support of the proposed transaction with Nippon Steel. Announced in 2023, the deal involves acquiring U.S. Steel for $55.00 per share in an all-cash transaction valued at $14.9 billion.
Employees cautioned that if the deal falls through, U.S. Steel might shift away from its blast furnace facilities, jeopardizing thousands of jobs, affecting nearby communities, and hindering the American steel industry's global competitiveness.
The deal has already secured regulatory approvals outside the U.S. and is currently undergoing review within the U.S.
