The third day of national contract bargaining between UE and GE dealt with wages, life insurance, and the union’s presentation of its demands on one of the major issues, job security. The company undermined its own credibility, said UE negotiators, with the way it later dismissed the promises it made in 2011, and with its conduct in transferring union work out of the Erie and Fort Edward plants.
The morning session started with a company presentation by Diane Shook on compensation, which summarized what UE members receive in wages, wage premiums such as overtime pay and night shift differentials, as well as pay-related benefits. The company offered comparisons of Local 506 compensation with what it said was median wages in transportation production jobs in the U.S., and with what it called “matched jobs” – comparable work – in the Erie area. The comparisons showed UE pay to be far higher than those comparables. The pay increases UE members received since 2011 “exceed the market and inflation.”
Scott Slawson, Local 506 president, immediately took the company to task on this issue. “There are no comparable jobs in Erie,” he said. He explained that there are no other jobs in heavy industry in Erie involving the range of skills involved in welding, assembling, wiring, piping, and the other tasks involved in producing a huge, complex and precision piece of equipment like a locomotive. The company quickly conceded Slawson’s point.
Both Slawson and Local 506 Business Agent Frank Fusco told the company, “We’re not going to apologize for our wages,” and said that the performance and profitability of the Erie plant show that their members more than earn their pay. GE spokesman Mike Luvisi replied that the company is not asking the union to apologize for its members’ wages, but asked, “Are we going to be able to compete?”
“You’re always picking up the mantra of competition,” responded UE International Rep. Gene Elk, the chief union spokesperson. “But you pick the businesses in which you operate, and you always choose businesses where there are zero or just one competitor so you can have an oligopoly. GE has no competitors in domestic locomotive production.”
“To attract good workers long-term, you have to be a leader in compensation,” said Local 506 Vice President Mike Ferritto. “There are huge safety risks in working in that plant,” he added.
Fred Harris, recording secretary of UE Local 601 in Grove City, PA, commented that the company has imposed two-tier wages in the facility where the union does not yet have majority membership and is not certified as bargaining agent. In one of the two Grove City plants that’s on the lower “competitive” wage, the injury rate is more than double that in the plant where most workers earn what the company calls “legacy wages” – pay rates people can live on.
Luvisi jumped in, declaring that UE does not represent Grove City and the company will not negotiate for Grove City. Elk responded forcefully. “I’m only going to say this once. We do represent a sizable number of workers in Grove City who are members of UE, and we will raise issues and offer examples from the experience of those workers. Fred is part of our bargaining committee and he has every right to speak here.”
Tom O’Heron of the IAM reiterated a point made the previous day about how GE’s switch to the GEHB health plan cut into workers’ wages. “There was a huge change in healthcare in 2011. We subsidized that from our wages.”
Next, the company brought in Mike Millot for a presentation on life and other types of optional insurance, like long term care. He described all the good elements of these benefits, but also talked about the trend of companies eliminating life insurance for retirees.
“’Trends’ means the race to the bottom – see how much you can squeeze people,” said Gary Jordan of the UAW. “Life insurance is important and our spouses are counting on this.” He said members of the “greatest generations” passed on to us good benefits such as this. “What are we going to leave to our children and grandchildren? Remember that our signatures will be on this contract.”
Following a lunch break, the agenda was UE’s presentation of the union’s job and income security proposals. “Words matter,” began Gene Elk.”We take your word seriously. When we give our word, we mean it.”
He then distributed copies of GE’s press release announcing the contract settlement in June 2011. It includes a quote from GE Vice President John Loomis saying that the contract, “…keeps the Company competitive and positions us to win orders while helping to retain and create more manufacturing jobs in the U.S.”
Some months later, said Elk, UE had a campaign to organize workers at a GE plant in Houston, Texas, where the company characterized the union and the contract as a threat to workers’ future employment security. In response to these attacks, UE showed workers the press release with Loomis’s quote. GE hit back with a vicious attack on UE in a leaflet titled “Don’t Be Fooled by the UE’s repeated mis-information…” which included these words: “Joint GE and UE contract negotiations are done with a purpose… to gain membership ratification.”
What the company was saying in this leaflet, said Elk, was that the company had never meant what it said about the contract in June 2011, it was just saying it to gain ratification.
Another blow to GE’s credibility also goes back to 2011, when the company told the Erie newspapers and UE Local 506 members that the new Fort Worth locomotive plant would be “an overflow plant” to back up the Erie plant. In April 2013 the union received its first notice from GE that it planned to transfer locomotive and OHV work from Erie to Ft. Worth. Substantial production of OHV wheels and locomotive had already been transferred before the company even notified the union. “This all came about despite the fact that GE had previously insisted that the Erie plant and the contract negotiated in 2011 kept the company competitive. In April 2013 you demanded massive concessions from our members making the new claim that Local 506 made the Erie plant uncompetitive.”
He then discussed the company’s sudden announcement in September 2013 that it would close the Ft. Edward capacitor plant, unless Local 332 could somehow come up with $6 million in savings in labor costs. “We figured out that we’d have to work for $11 an hour to reach that number,” said Elk. GE intended to move Ft. Edward’s work to Clearwater, Florida and pay $12-13 an hour.
“Then the company had the nerve to tell us that the plant is antiquated and had machines that are 40, 50, 60 years old and implied that it was somehow our fault. You failed to invest in the Ft. Edward plant,” said Elk. “We don’t feel the company has been above board on the job security issue.”
In the Erie “decision bargaining,” Local 506 refused to agree to the concessions demanded by GE. What GE had promised in exchange for these pay cuts and other givebacks was no better than what happened without concessions. “If we had granted concessions, we would have gained nothing more than you intended to do anyway,” Elk said. Local 506 Vice President Mike Ferritto, who participated in those 2013 work transfer negotiations, affirmed Elk’s interpretation of events.
“I’m proud that we didn’t do what the company wanted,” said Elk. “Words matter, and we’ll hold you to what you say in these negotiations.”
UE President Bruce Klipple said of job security, “This is a serious subject for us,” and told the company, “The competition is you. You created Ft. Worth and Clearwater.” Klipple called GE’s treatment of the Ft. Edward workers “shameful.”
“You could have built that ‘Center of Excellence” in Ft. Edward and had a skilled workforce right there,” said Klipple. He described the job security issue as “right up there at the top of our list. We don’t know what to believe anymore. We don’t believe the company.”
Elk then began presenting the union’s job and income security proposals. They included reopening the SERO window with one-for-one replacement to save jobs; eliminating the wage loss reduction to qualify for SERO 30; substantially increasing severance pay and other job loss benefits like improved training and relocation expenses. The union also called for extending rate guarantees to workers indirectly affected by work transfers, and including guarantees for incentive workers’ earnings.
A major UE proposal is to eliminate the artificial 60-day limit on decision bargaining. Elk discussed the harmful impact of the 60-day limit in both the Erie and Ft. Edward work transfer cases. “This lets you off the hook too quickly. Our jobs are important and we need the opportunity to exhaust all possibilities to save jobs before we’re done with this kind of decision bargaining.”
Elk also introduced a new provision which would cover expired or stale work transfer notices, such as in Erie, where the company now claims that it transferred the production of all Evolution locomotive manufacturing, even though Local 506 still produces more than 400 EVOs a year. Such notices would expire if the transfer didn’t occur within six months of the original date announced by the company. Once a transfer notice expired, the work would have to remain in place for the duration of the national contract or four years, whichever is longer.
The union also proposed that notice and bargaining be required for farm-outs, maintenance subcontracting, and process changes.
Citing the long period of uncertainty involved in the sale of GE’s Appliance business, UE also demanded automatic recognition of the union and acceptance of the contract by the successor employer in a plant sale, as well as providing plant closing benefits in the case of the closing of the Akron appliance service unit.
The union presented several other job security proposals which makes it more difficult to subcontract maintenance work and requires bargaining even if subcontracting does not immediately lead to a loss of jobs.
UE was represented by President Bruce Klipple, International Rep. Gene Elk, Local 506 Business Agent Frank Fusco, President Scott Slawson, Chief Plant Steward Leo Grzegorzewski, and Vice President Mike Ferritto; Local 332 President Melvin O’Dell and Business Agent Sherice Stark; Local 618 President Mike Divins; Local 601 Recording Secretary Fred Harris; Northeast Region President Peter Knowlton; Research Director Karl Zimmerman; and UE News Managing Editor Al Hart. Field Organizer Omar el-Malah represented UE at the IUE-CWA bargaining table. Other CBC unions joining UE at the bargaining table were the UAW, IAM, IBEW and USW.