Monday, July 23, 2012

To Celebrate $4.9 Billion Profit Caterpillar Demands a Six-year Wage Freeze (CAT)

From the New York Times via Yahoo Finance:
When it comes to dealing with labor unions, Caterpillar has long taken a stance as tough as the bulldozers and backhoes that have burnished its global reputation. Be it two-tier wage scales or higher worker contributions for health insurance, the company has been a leader in devising new ways to cut labor costs, with other manufacturers often imitating its strategies.

Now, in what has become a test case in American labor relations, Caterpillar is trying to pioneer new territory, seeking steep concessions from its workers even when business is booming.

Despite earning a record $4.9 billion profit last year and projecting even better results for 2012, the company is insisting on a six-year wage freeze and a pension freeze for most of the 780 production workers at its factory here. Caterpillar says it needs to keep its labor costs down to ensure its future competitiveness...
“Caterpillar has been a leader in the past 20 years in taking a hard line,” said Richard Hurd, a professor of ...industrial relations at Cornell. Last winter, Caterpillar locked out about 450 workers at its locomotive plant in London, Ontario, and then closed the factory after the union rejected its demand to cut wages by 55 percent. In the mid-1990s, the company vanquished the United Automobile Workers after a 17-month strike by 9,000 workers at eight factories; the union surrendered and accepted the company’s concession-filled offer. ...MUCH MORE