STEUBENVILLE - RG Steel is notifying workers that widespread layoffs, potentially even plant closings, could be ordered within the next 60 days, saying there is "continued uncertainty" surrounding efforts to persuade lenders to lend them working capital needed to maintain operations.
The Worker Adjustment and Retraining Notification Act, or W.A.R.N., requires companies with 100 or more employees to notify their work force 60 calendar days prior to a plant closing or mass layoffs. However, merely issuing such a notice does not mean the layoffs or plant closing will, in fact, materialize.
In a brief statement issued this morning, RG Steel said it issued the W.A.R.N. notice "in order to ensure good-faith compliance with the law and to provide advance notice to our employees of potential layoffs."
"Since there is continued uncertainty regarding outcome of discussions with our lenders as to the required level of funding to support the working capital necessary to sustain business operations, we felt it prudent to issue the W.A.R.N. notices at this time," it said.
United Steelworkers Union leaders are awaiting copies and this morning said that until they received them, no comment would be forthcoming.
Reports that the company is teetering on the verge of bankruptcy have been circulating the Ohio Valley for weeks.
The Baltimore Brew, a daily online newspaper in the Maryland community, recently reported that workers at RG's Sparrows Point, Md., operation had been told by union leaders that the situation is dire and that management had asked the USW for permission to sell the company, including its Steubenville plant.
RG is free to negotiate a sale, but, under the terms of its contract the USW has the power to skuttle any deal it doesn't like. The USW has exercised that option in the past, backing the ill-fated Esmark over a bid from a Brazilian steelmaker in 2006, and Russia's Severstal Steel over a bid for Esmark by India's Essar in 2008, and Renco Group, RG Steel's parent company, over bids from two other companies in 2011.
Union officials have said about 700 RG Steel workers remain on the job in the Ohio Valley, less than a third of the local work force.
Initial reports suggest that the only two operations locally that won't be impacted are the Ohio Coatings Co. and Mountain State Carbon, the company's joint ventures.