Sen. Bernie Sanders wrote a letter to Berkshire Hathaway’s CEO requesting that he intervene in a United Steelworkers’ union strike at the Special Metals plant in Huntington, West Virginia. They have been on strike for three months. Special Metals is a unit of Precision Castparts, owned by Buffett’s Berkshire.
His letter stated that employees were offered a contract without pay increase the first year, only a signing bonus of $ 2000, and then pay increases of 1% the second year and 2% per year for the following three years. It said the company wants to increase the cost of health coverage for workers from $ 275 a month to $ 1,000. And it reduced the vacation time they have already earned.
But Buffett responded with a letter citing Berkshire’s annual financial filing to the Securities and Exchange Commission, which tells investors that the management of the various companies is left to the managers of each subsidiary – not Berkshire itself (or Buffett).
“Our companies individually handle their own work and personnel decisions (except for the election of the CEO),” he said in his response to Sanders, which was released by Sanders’ office. “I am sending your letter to the CEO of Precision Castparts, but make no recommendations to him about any action. He is responsible for his business.”
Buffett’s letter to Sanders cites several examples of unionized subsidiaries of his company, including NetJets and See’s Candy. And Sanders’ letter plays on an appeal to Buffett to live up to his expressed concerns about income inequality.
“Mr. Buffett: You have spoken out about the crisis our country is now facing in terms of rising incomes and wealth inequality. You have correctly pointed out that while working families are struggling, the top percentage are doing extremely well,” Sanders wrote. .
The special metals strike
Special Metals makes nickel alloy metals essential for spacecraft and aircraft. Berkshire acquired Precision Castparts in 2016 for $ 37.2 billion. Berkshire reported that Precision Castparts reported revenue of $ 1.6 billion in the third quarter, and that its third-quarter profit was up $ 217 million from the third quarter of 2020, although it did not say how much the quarter’s profit was. Berkshire reported its total revenue of $ 10.3 billion in the quarter and $ 50.1 billion in the first nine months of the year.
A video posted on the United Steelworkers’ Union website quoted strikers as saying that Special Metals continues to operate, although it does not say whether they use temporary workers, permanent workers or salaried personnel to staff the factory.
“If I were a customer out there, I would not want something I know that a bunch of crusts were produced, because they do not know what’s going on,” union member Steve Brumfield said in the union’s video.
The communications department for Precision Castparts issued a statement stating that their “desire is to achieve a respectful and productive relationship with our employees, and we have ultimately achieved this goal in previous contract negotiations over many years.” It said it has and “will continue to negotiate in good faith” with the union. It did not answer questions about reported offers to the union or how it has been able to operate, and plans to continue operations, if the strike continues.