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- Apr 3, 2003
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Sunday, June 20, 2004
Concessions give unions double dose of heartburn
By Daniel Howes / The Detroit News
The economy is booming, jobs are being created and industrial unions are careening from one crisis to another.
There’s a message here, and it isn’t encouraging.
Steelworkers at Timken Co. in Canton, Ohio, are digesting the news that a century-old bearing plant will close because operating costs are too high and the work can be done as well — and less expensively — in Timken’s other (nonunion) U.S. plants.
United Auto Workers members at the old Rouge Steel in Dearborn survived bankruptcy and now work for Russian bosses after choking down a concessionary contract just to survive.
Two of the world’s largest auto suppliers — Delphi Corp. and Visteon Corp. — wrested agreements from the UAW that will allow them to pay new hires substantially lower wages than current employees. Those are the so-called “two-tier wages†that union die-hards said they would never tolerate in their plants.
Union brothers at an Electrolux AB appliance plant in Greenville, desperate to save their jobs, agreed to pay and benefit cuts only to see their masters back in Sweden decide to close the plant and transfer the work to Mexico.
So perhaps a little cynicism is understandable for 300 UAW members at a Federal-Mogul Corp. plant in Greenville. They rejected a contract last weekend that cuts average wages 6.35 percent over four years, only to ratify it Saturday when it became clear the plant would close.
Does it always have to come to this?
Too often, it does. No one — union or nonunion — wants to take pay cuts or decreases in pension and health care benefits. Yet even some of the most hardened unionists realize they face a fundamental choice: Adapt to the global economy or die.
“What choice do we have?†UAW President Ron Gettelfinger said when I asked him about his pragmatic approach to bargaining.
Increasingly, the answer is, “Not much.†Rouge Steel was bankrupt, and but for OAO Severstal and UAW Local 600, it would be gone. Federal-Mogul is bankrupt, too, and workers at its Greenville plant are paid more, on average, than employees at its 46 other factories in the United States.
These companies aren’t pressuring their employees for givebacks because they’re “greedy.†They’re asking for relief because they’re trying to survive, figuring slightly smaller paychecks and higher prescription drug co-pays are a fair trade for keeping jobs where they are.
Bankrupt United Airlines’ bid for federal loan guarantees was rejected last week. The CEO of Delta Air Lines says it, too, may soon file Chapter 11. And it will be a hot summer at Northwest Airlines, which is seeking contract concessions from its pilots, mechanics and flight attendants who should understand that the specter of bankruptcy shadows their employer, too.
Should that happen, many of them — especially the pilots — can kiss their pensions goodbye.
This is the world as it is, not as those chanting “no concessions†want it to be. To show their solidarity, they could pay full coach fare for a Northwest flight to Boston instead of shopping the Internet for the best price. Or they could decline the $5,000 incentive offered by General Motors when they buy that new SUV.
But almost no one will because they don’t have to.
Daniel Howes’ column appears Sundays, Wednesdays and Fridays
Concessions give unions double dose of heartburn
By Daniel Howes / The Detroit News
The economy is booming, jobs are being created and industrial unions are careening from one crisis to another.
There’s a message here, and it isn’t encouraging.
Steelworkers at Timken Co. in Canton, Ohio, are digesting the news that a century-old bearing plant will close because operating costs are too high and the work can be done as well — and less expensively — in Timken’s other (nonunion) U.S. plants.
United Auto Workers members at the old Rouge Steel in Dearborn survived bankruptcy and now work for Russian bosses after choking down a concessionary contract just to survive.
Two of the world’s largest auto suppliers — Delphi Corp. and Visteon Corp. — wrested agreements from the UAW that will allow them to pay new hires substantially lower wages than current employees. Those are the so-called “two-tier wages†that union die-hards said they would never tolerate in their plants.
Union brothers at an Electrolux AB appliance plant in Greenville, desperate to save their jobs, agreed to pay and benefit cuts only to see their masters back in Sweden decide to close the plant and transfer the work to Mexico.
So perhaps a little cynicism is understandable for 300 UAW members at a Federal-Mogul Corp. plant in Greenville. They rejected a contract last weekend that cuts average wages 6.35 percent over four years, only to ratify it Saturday when it became clear the plant would close.
Does it always have to come to this?
Too often, it does. No one — union or nonunion — wants to take pay cuts or decreases in pension and health care benefits. Yet even some of the most hardened unionists realize they face a fundamental choice: Adapt to the global economy or die.
“What choice do we have?†UAW President Ron Gettelfinger said when I asked him about his pragmatic approach to bargaining.
Increasingly, the answer is, “Not much.†Rouge Steel was bankrupt, and but for OAO Severstal and UAW Local 600, it would be gone. Federal-Mogul is bankrupt, too, and workers at its Greenville plant are paid more, on average, than employees at its 46 other factories in the United States.
These companies aren’t pressuring their employees for givebacks because they’re “greedy.†They’re asking for relief because they’re trying to survive, figuring slightly smaller paychecks and higher prescription drug co-pays are a fair trade for keeping jobs where they are.
Bankrupt United Airlines’ bid for federal loan guarantees was rejected last week. The CEO of Delta Air Lines says it, too, may soon file Chapter 11. And it will be a hot summer at Northwest Airlines, which is seeking contract concessions from its pilots, mechanics and flight attendants who should understand that the specter of bankruptcy shadows their employer, too.
Should that happen, many of them — especially the pilots — can kiss their pensions goodbye.
This is the world as it is, not as those chanting “no concessions†want it to be. To show their solidarity, they could pay full coach fare for a Northwest flight to Boston instead of shopping the Internet for the best price. Or they could decline the $5,000 incentive offered by General Motors when they buy that new SUV.
But almost no one will because they don’t have to.
Daniel Howes’ column appears Sundays, Wednesdays and Fridays
