`Working Capital': Labor's New Weapon?

It wants to use pension funds to reshape corporate policies

When 4,200 members of the United Steelworkers went on strike at Wheeling-Pittsburgh Steel Co. last year, they didn't just walk a picket line. Aided by a new AFL-CIO Office of Investment, the union also went after major stockholders of Wheeling-Pitt's parent, New York-based WHX Corp. In angry letters last summer to WHX's largest shareholder, Dewey Square Investors Corp., AFL-CIO Secretary-Treasurer Richard L. Trumka pointed out that the strike had cut WHX's stock price in half. By backing WHX, he argued, Dewey Square had hurt its 10% stake. Trumka also noted that Dewey Square's parent, Boston-based United Asset Management Corp. (UAM), manages $10 billion in union pension money. "We said: `If this is your philosophy, you shouldn't be managing worker money,"' says Trumka.

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