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Caterpillar, Workers Reach Tentative Deal On Contract (Read More…)

By Bob Tita
April 30, 2013

Caterpillar Inc. (CAT) and the United Steelworkers Union have reached a tentative agreement on a six-year contract for about 800 workers who assemble mining machinery in Wisconsin, the Milwaukee Journal Sentinel reports.

Members of Steelworkers Local 1343 in Milwaukee will be voting Tuesday on a proposed contract that would freeze wages and the pension for veteran workers and lower pay rates for new hires. Workers also would contribute more for health insurance coverage for family members, the newspaper reports.

In return, the Peoria, Ill., machinery maker would provide workers with a $2,500 bonus for ratifying the contract and additional cash bonuses tied to the company’s performance that could total $25,000 per worker over the life of the contract. Workers are paid between $18 and $34 per hour, the newspaper says.

The current contract is scheduled to expire on Tuesday. Caterpillar this summer is expected to lay off about 300 workers, or 40% of the unionized work force, at a pair of plants in Milwaukee and South Milwaukee in response to slowing demand for mining machinery. Caterpillar also plans to dismiss 460 workers at its plant in Decatur, Ill., where large mining trucks are assembled.

Caterpillar acquired the Milwaukee assembly plants as part of its $8.8 billion purchase of Bucyrus International Inc. in 2011. The current contract fashioned by Bucyrus and the USW in 2008 extended an earlier agreement and eliminated a two-tier wage scale that paid new employees less than veteran workers.

Members of Local 1343 have so far have given no indication they intend to strike. Workers at a Caterpillar plant in Joliet, Ill., waged an unsuccessful three-month strike last year. Workers at the plant ended up accepting the company’s demands for cuts in health-care and pension benefits and a freeze in wages for veteran workers—conditions that union had opposed for months. Workers at the Joliet plant, which makes hydraulic components for construction machinery, are represented by the International Association of Machinists and Aerospace Workers.

Caterpillar last year closed a rail-locomotive assembly plant in London, Ont., after workers there refused to accept pay cuts of around 50%. Caterpillar had said the pay levels and union work rules made that plant uncompetitive. The company then expanded production of locomotives at a non-union plant in Muncie, Ind


Posted by Admin on 04/30 at 07:42 AM