Ratifcation Of Contract between Catepillar & IAM Faces Difficulties
Updated On: Aug 17, 2012
When you read this, do you see the similarities between them and us; what this Company is trying to achieve? It's scary, the latest trends in negotiations---wage freezes, pension freezes, increase healthcare costs, wage tier systems, the International going behind their backs---and this is after a 4 month strike! Catepillar Management wants the hourly wages to remain competitive, but raise their own salaries....as much as 60%; how do you think that flies with the hourly?!?!
Ratification of Union’s Deal With Caterpillar May Face Difficulties
By STEVEN GREENHOUSE
Caterpillar and the International Association of Machinists said on Wednesday that they had reached a tentative six-year settlement that could end a 15-week strike at the company’s hydraulics parts plant in Joliet, Ill.
But the settlement may face difficulties in the ratification vote on Friday. Top officials in the striking local — upset that the deal contained nearly all the far-reaching concessions Caterpillar had sought — said they would urge members to reject the deal, which was negotiated not by the local but at the district level.
The dispute — which involved a company known for setting an example for corporate America in its tough bargaining and a union known for resisting givebacks — has become a test case in American labor relations. Many workplace experts said Caterpillar was trying to pioneer territory by demanding major concessions, including a wage and pension freeze, even when its business was booming.
Tim O’Brien, president of Machinists Lodge Local Lodge 851, with about 700 members on strike, said the local’s bargaining committee would urge members to vote against the deal on the grounds that it contained steep concessions even when Caterpillar was making record profits.
The tentative settlement, union negotiators said, bows to Caterpillar’s demand for a six-year wage freeze for the top tier of workers, hired before May 2005. For the lower-paid tier of workers, hired after that date, the deal calls for one raise during the six years — 3 percent at the end of this year. The company’s previous offer did not promise any raise for that group.
Caterpillar has said — without promising — that it might also adjust the bottom tier’s wages upward according to local market conditions. The bottom tier represents approximately one-third of the factory’s workers. Their pay generally is $12 to $19 an hour, compared with a $26 average for the top tier, representing two-thirds of the plant’s workers.
Mr. O’Brien and many of his local’s members have repeatedly voiced unhappiness about Caterpillar’s insistence on a six-year wage freeze for the more senior tier, a pension freeze for those workers and a significant increase in the workers’ contributions to health insurance coverage.
“I’m not for this deal,” Mr. O’Brien said. “I haven’t been out on the picket line, doing all these things, so that I now have to put my tail between my legs and say I’m giving up.”
He acknowledged that about 105 of the 780 Caterpillar workers in his local had crossed the picket line since the strike began on May 1.
Caterpillar’s statement announcing the tentative deal added, “By agreement of the parties, we will not be commenting on any specific details of the tentative contract.”
Steve Jones, the top official in Machinists District 8 in Burr Ridge, Ill., and the union leader who reached the deal with Caterpillar, defended the settlement’s terms.
“It does not address every issue for every member, but it deserves to be brought to the membership for a vote,” he said in an interview, noting that many members were under financial strain after nearly four months on strike.
“It shouldn’t be individual leaders, a committee or the district who decide. We should allow the membership to voice their views.”
Mr. Jones added: “We’ve got some local people playing politics with people’s livelihoods. If there was a better agreement out there to be had, we would have taken it.”
But Mr. O’Brien said the parent union was giving up too easily and was feeling stretched from paying about $100,000 each week in strike benefits.
Mr. O’Brien said the deal also called for a $1,000 bonus for each worker upon ratification. Before the walkout began, the workers had voted down an offer that included a $5,000 ratification bonus.
Another Caterpillar demand that angered the workers was its insistence that the factory’s managers be able to indefinitely assign workers to new jobs or shifts regardless of seniority. That upset the workers because it struck at a basic tenet of unionism: seniority preferences.
Under the tentative deal, negotiators said, the company could still assign workers to new jobs or shifts outside of seniority, but only for a maximum of 90 days.
The strikers often insisted that it was wrong for Caterpillar to call for a six-year wage freeze when the company, the world’s leading producer of earth-moving equipment, had record profits of $4.9 billion last year and forecasts stronger earnings this year. Moreover, many strikers bristle at a pay freeze because compensation for Caterpillar’s chief executive, Douglas R. Oberhelman, jumped by 60 percent in 2011, to $16.9 million.
Caterpillar officials said they pushed for a pay freeze for the more senior workers to help the company remain cost-competitive because their pay was above market levels.