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For immediate release Kaiser Strike Losses Unnecessary But Will Continue USWA Responds to 4th Quarter Earnings Release MINNEAPOLIS, January 28-Kaiser Aluminum's fourth quarter loss was totally unnecessary and is further evidence of the company's misguided management, union representatives said today in response to Kaiser's report that it had suffered a net loss of $38.9 million and strike related costs of $50 million during the fourth quarter of 1998. "The company and its shareholders should know that this money was wasted and could have been put to productive use upgrading Kaiser's plants, improving the standard of living of employees and increasing shareholder value," said David Foster, USWA District 11 Director and the union's chief negotiator with Kaiser. "The $50 million in strike costs dwarfs the cost of the union's proposal. Had the company obeyed the law and negotiated in good faith with its employees, it would have avoided the strike and made substantial profits during the fourth quarter," he said. "The company's decision to provoke this labor dispute and prolong it with an illegal lockout has not only squandered $50 million, but risks $3.3 million per week in back pay liability if the Union's unfair labor practice charges are upheld," Foster added. "If Kaiser is really serious about reaching a new labor agreement, investing in our communities and increasing shareholder value, it should take this $50 million loss as a message: end this illegal lockout and send your negotiators back to the table with orders to get an agreement," he said. In response to company claims that these losses are one-time events that will be worth it in the long run to the company and its shareholders, Foster said, "The company has a choice. Kaiser can continue on the road to ruin by running a makeshift operation staffed by unskilled, inexperienced temporary replacements. Or it can negotiate for real productivity improvements with its skilled work force. "The company knows we are willing to address labor productivity issues, but only as part of a fair contract that gives our members more job security and minimizes the disruption for employees whose jobs are eliminated. But instead of negotiating for specific reductions and safeguards for the workers who made this company profitable, Kaiser has insisted on massive layoffs and outsourcing of work," Foster said. Although the company asserted that the $50 million loss would not continue, Foster noted that Kaiser is still operating with three potlines idled at its Tacoma and Mead, Wash., smelters. "Kaiser is having enough trouble operating its smelters at a reduced level with salaried employees and unskilled replacement workers. It will be hard pressed to restart the idled potlines. Given the turnover among the replacement employees, production losses and revenue foregone, these losses will continue until USWA members are returned to work," Foster said. As proof of the inexperience of Kaiser's replacement workforce, Foster noted that the number of lost workdays at the company's Tacoma smelter has increased by nearly 900% since the labor dispute began, according to OSHA statistics. Kaiser also announced that it would write off $45 million of its investment in its Sierra Micromill. "The write-off," Foster said, "is an admission that the project was a failure. This is especially troubling for our members since that capital investment could have been used to upgrade or expand the company's existing facilities, which have long been starved for capital." USWA members struck Kaiser Aluminum in response to the company's unfair labor practices and substandard contract offer on September 30, 1998, and offered to return to work on January 13, 1999. On January 14, the company locked out over 2,900 USWA members at its plants in Gramercy, La., Newark, Ohio, and Tacoma and Spokane, Wash. # # #
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