Workers at Freightliner ratify new pact

Union workers at Freightliner Corp. in Portland ratified a new three-year contract that provides for wage and pension increases, fully-paid health insurance benefits, signing bonuses and more.

"With the economy the way it is, we went into negotiations thinking we would have to fight takeaways, but instead we came out with a very good contract," said Steve Hillesland, business representative of Machinists Lodge 1005 and spokesman for the four unions that bargain jointly at Freightliner.

Workers thought so, too.

The deal won 94 percent approval from members of the Teamsters, 91 percent from members of Sign Painters and Paint Makers Local 1094; 87 percent from Machinists, and a unanimous vote among custodial workers who are members of Service Employees Local 49.

Wage and pension allocations differed slightly among the crafts, but the dollar amounts were the same, Hillesland said. The Machinists will receive an immediate 50 cent an hour pay hike and a 20 cent an hour pension boost. In the second and third years of the pact workers will receive 45 cents in wages and 10 cents in pension. Wages also are protected by a cost-of-living adjustment formula.

Other improvements include post-retirement medical benefits for spouses from age 60 to 65; a boost in life insurance coverage from $50,000 to $60,000; one additional holiday to bring total holidays to 15; better short-term disability pay (from $200 to $225 a week for the first four weeks, and from $250 to $275 for the ensuing 22 weeks); five days of funeral leave for the death of a parent, child or spouse; a $500 pre-tax ratification bonus plus a lump-sum bonus of $500 paid July 1, 2002, and $1,000 paid July 1, 2003.

Workers will be somewhat protected from future layoffs, with the company agreeing to pay six months' health insurance.

Over the last two years Freightliner has laid off more than 1,450 workers in Portland alone. The Swan Island plant employs 1,128 union workers and is down to one day shift. Two years ago there were 3,000 union workers cranking out 112 trucks a day. The Machinists Union was impacted the hardest by the layoffs, losing 1,400 members. Today, the 1,100 workers turn out 35 trucks a day and are back-ordered through August, Hillesland said.

High gas and energy prices coupled with a downturn in the economy are blamed for the downturn in the trucking industry. But Freightliner's generous warranty and repurchase policies and its rapid purchase of numerous other manufacturing plants over the past few years have also taken a toll on the company financially.

Starting in 1995 Freightliner - a wholly-owned subsidiary of DaimlerChrysler - bought its first non-traditional truck company, American LaFrance, makers of fire trucks and emergency vehicles. It also entered the custom chassis market with the purchase of Custom Chassis Corporation of Gaffney, South Carolina. In 1997 Freightliner purchased Ford Motor Company's heavy truck business in 1997 (renaming it Sterling), bus maker Thomas Built Buses in 1998, and Western Star Trucks and Orion Buses in 2000. Earlier this year the company's chief executive office James Hebe resigned and replaced with Rainer Schmueckle from Freightliner's corporate headquarters.

"There are no crystal balls looking into the future," Hillesland said. "It was a tough round of negotiations, maybe one of the toughest I've seen. I think this agreement recognizes the value of their workers for the healthy future of the company."

July 20, 2001 issue

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