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Alcoa, Machinists Cut Labor Deal

The 4-year contract will increase health care costs but provide wage increases for 45 union machinists.

Alcoa (AA) - Get Alcoa Corporation Report has reached a new labor agreement with the International Association of Machinists for its Cleveland Works plant.

The 4-year contract covers 45 IAM workers at the facility who are represented by IAM District 54, Lodge 10. The plant makes aluminum truck and car wheels, as well as aerospace and industrial products.

Alcoa says the agreement, which goes into effect immediately, requires workers to contribute about $20 a week to cover health care premiums. Previously, most of the workers at the plant didn't have to contribute to premiums, an Alcoa spokesman said.

The contract also allows Alcoa to begin a new attendance policy aimed at reducing absenteeism, which the company says has become a problem at the plant.

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It also calls for wage increases averaging about 9% over the life of the contract.

IAM workers received a $1,500 signing bonus upon ratifying the deal.

The contract was rejected last week by a United Auto Workers local that represents some 800 other workers at the plant. Those workers are now on strike.

Alcoa shares lost 50 cents to close at $28.51 Friday.