Century Aluminum US plant lockout in prospect after union rejects deal

(Updating to include Century comment, adds background)

May 12 (Reuters) - The United Steelworkers union has rejected a pay deal from Century Aluminum (NasdaqGS: CENX - news) for workers at the fourth-largest aluminium smelter in the United States, the local branch said on Tuesday, and a lockout is now set to go ahead.

Unionized workers at the Century Aluminum smelter in Hawesville, Kentucky, had voted on Monday on the revised labour deal after management agreed to postpone a lockout of staff to Tuesday.

The rejection of the deal, which would replace the contract that expired at end-March, was posted on the website of the Hawesville branch. (http://www.usw9423.com/News.html)

Century, which is controlled by Glencore (Xetra: A1JAGV - news) , said it is prepared for a lockout which will start on Tuesday morning and is expected to continue to operate at full production. The smelter has a capacity of 244,000 tonnes per year.

The vote "leaves us with no choice but to lock out union represented workers," said John Hoerner, senior vice president, North America operations in a statement following the result.

This is the third time the members have vetoed a deal between the union's negotiating committee and management.

The latest offer included pay increases of more than 14 percent over five years, fixed costs for health insurance, and new language on overtime, Century said.

"In essence, we're out of options," he said. (Reporting by Polly Yam in Hong Kong; Additional reporting by Melanie Burton in Melbourne and Josephine Mason in London; Editing by Tom Hogue, Alan Raybould and W Simon)