NEW YORK (Reuters) – Philadelphia Power Options will defer retirement funds to union members till subsequent yr, the corporate mentioned in a letter to the union final week, the most recent signal the refiner is struggling to seek out its monetary footing after rising from chapter lower than a yr in the past.
The Philadelphia Power Options oil refinery owned by The Carlyle Group is seen at sundown in Philadelphia March 26, 2014. Image taken March 26, 2014. REUTERS/David M. Parrott/File Photograph
The corporate knowledgeable union members late final week that it was deferring firm matched bi-weekly funds into their retirement accounts and can as an alternative make a lump-sum cost on April 1, 2020, in accordance with the letter, a replica of which was obtained by Reuters.
The corporate didn’t present a proof for the swap, however the transfer will permit it to avoid wasting money within the quick time period however comes with the danger of increase a large legal responsibility. If the corporate have been to file for chapter, for instance, the union would be part of different collectors in searching for funds.
An organization spokeswoman didn’t instantly reply to requests for remark.
The transfer angered the union, which not too long ago arrange a picket line on the refinery’s entrance gates.
“We won’t work in an oil refinery with no actual retirement plan. It received’t occur,” Ryan O’Callaghan, president of the United Steelworkers Union Native 10-1, mentioned in a cellphone interview on Friday.
The union’s contract expires in September however the firm has requested to begin negotiations early and for concessions.
The refiner additionally not too long ago let go about 25 % of its contract staff, two sources acquainted with the plant’s operations advised Reuters on Friday.
PES, which emerged from chapter in August, noticed its money stability fall to $87.7 million on the finish of 2018 from $148 million simply three months earlier, in accordance with a post-bankruptcy monetary report filed in January.
The corporate completed the primary quarter with $87.eight million in money, the most recent monetary data present. PES nonetheless has extra $700 million in long-term debt, most of which comes due in 2022.
U.S. East Coast refiners like PES lack entry to cheaper crude that refiners in different elements of the nation take pleasure in, which inflicts higher ache on the area’s trade when margins are low.
A number of vegetation have closed previously twenty years, and PES confronted closure in 2012 earlier than being rescued by the Carlyle Group.