The United Steelworkers (USW) announced August 7 that a new master agreement has been ratified, covering 4,000 members with BFGoodrich's three plants in
"This contract protects wages for our existing employees, preserves cost of living adjustment (COLA) payments and maintains excellent health care benefits for both our active and retired members," said USW-BFGoodrich coordinator Larry Jackson. "We also negotiated a buyout package for more than 400 workers that will provide our older members with additional options, while enhancing job security protections for the younger ones."
The contract guarantees no announced plant closures during the contract, a minimum of $100 million in capital investment expenditures to keep the facilities globally competitive, 100 percent protection of all technical maintenance jobs and a 90 percent guarantee for all others. A pension increase is also part of the package, with an improved pension multiplier of $57 per month – up from $54 – per year of service for retirements after July 23, 2006.
The USW's preservation of COLA – a benefit that was gained 30 years ago – played a large role in the ability of the union to protect retiree benefits. The active employees agreed to divert the first $1 of a COLA to a retiree trust that, combined with annual multi-million dollar cash infusions from the company, maintained very reasonable retiree premium contributions. The new contract kept in place health care coverage for active members without any monthly premiums.
"Given the challenges facing every American industry, and ones specific to tire manufacturing such as escalating oil costs, higher material coats and reduced demand, it was very difficult negotiating an agreement that protected jobs, benefits and pensions," said USW executive vice president Ron Hoover. "But we did."
The contract also puts in a new wage payment schedule for the future that will allow the plants to continue to compete globally. While starting wages for certain less skilled jobs are lower, the wage progression schedule is shortened by one year, and health care, pension and retiree health care benefits are maintained.
In June, the USW named BFGoodrich as the industry's target company. With a new contract in place at this Michelin subsidiary, the Steelworkers will use it as a template in forging new agreements at Goodyear and Bridgestone/Firestone. By targeting a company in master contract negotiations and setting a pattern agreement for the rest of the industry to follow, no company is able to achieve an unfair advantage when it comes to the cost of labor.
The USW represents some 70,000 members in the tire, rubber and plastics industry, and 850,000 overall in the
