By DON McINTOSH, Associate Editor
Xerox factory workers in Wilsonville, Oregon, voted overwhelmingly Oct. 13 to authorize a strike.
Xerox revenue grew 42 percent last year, to $21.6 billion, and it paid CEO Ursula Burns $13.2 million. But Xerox is proposing deep pension cuts and other concessions for the 183 members of Service Employees International Union (SEIU) Local 49 at its Wilsonville color printer complex, which it acquired from Tektronix in 2000.
“It’s corporate greed,” said chief steward Gary Daniels. “Xerox doesn’t need to do this. They’re making profits. They’re doing great.”
Union bargaining is where you see the soul of an employer. Earlier this year, a Xerox negotiator showed in a PowerPoint presentation all its unionized U.S. locations that have downsized or moved work overseas. The exception, the negotiator said, was the Xerox facility in Cerritos, California: Because the union made concessions, Xerox is bringing back some work. Get the message?
All over the country, says Local 49 organizer Casey Filice, Xerox is demanding that its union workers agree to diminished retiree benefits. Xerox has about 130,000 employees worldwide.
In Wilsonville, union members work in cleanrooms making print heads with a specialized solid ink crayon. Those are sent to Malaysia for assembly into printer cartridges in high-end office printers. Union members in another building ship and receive printers and prepare printers for end users.
About 1,400 nonunion employees also work at the Wilsonville complex, including technicians, administrators, and customer service call center workers. In June, the company informed 120 non-union engineers that they were no longer employees of Xerox. They do the same work at the same desks, but now work for contractor HCL, an Indian company that specializes in engineering outsourcing.
Meanwhile, Local 49 members agreed to freeze their own pensions in order to preserve a set of benefits for 50 retired members who don’t get to vote on the contract. The traditional “defined benefit” pension will be frozen at the end of 2012, meaning workers will no longer accumulate new pension benefits. Instead, workers will rely on an interest-bearing “cash balance retirement account” into which Xerox deposits 4 percent of pay. Chief steward Daniels, 31, calculates the change will cost him $30,000 if he retires at age 65.
Wages among the union members average $14 an hour. About half would get no raise under Xerox’ proposal, while the other half — those a company-sponsored labor market survey identified as underpaid for their occupational classification — would get raises averaging 2.4 percent. Xerox also agreed to lump sum bonuses of 2.5 and 2.75 percent.
The company did drop some earlier demands for concessions, including eliminating sick days and reducing pay up to 50 percent for long-term employees. The union contract allows Xerox to use nonunion temps for up to 30 percent of the workforce, and Xerox also dropped a demand to take that up to 50 percent.
And Xerox agreed that the workers may enroll in a union-sponsored Kaiser Permanente health plan that provides better benefits at lower cost to employees — for the same cost to the company.
But in return for that cost-neutral concession, Xerox is demanding that a short-term disability benefit for union workers be cut — while keeping it for managers and nonunion workers. That’s become a sticking point for the union. Their short term disability plan restores 80 percent of a worker’s pay for six months in the event of a serious illness or accident outside of work. Managers have the same benefit, but at 100 percent of pay. Xerox wants to cut the union benefit to 60 percent of pay, for five months, and introduce a one-week waiting period before the benefit begins.
“It’s about surviving,” Daniels said. “This could make or break a family. It’s difficult already to go down to 80 percent.”
The cost difference between the company and the union position would total $60,000 over the duration of the contract, Filice said — one day’s wage for CEO Burns.
The Local 49 contract at Xerox expired in July, but was extended through Oct. 13 by mutual agreement. Since the Oct. 13 vote authorizing the union bargaining committee to call a strike, members have been working with out a contract.
Because the United States has one of the worst sets of labor laws in the world, employers have the right to “permanently replace” employees who strike. The exception, under the law, is when workers strike to protest labor law violations known as “unfair labor practices.” Employers can still replace strikers, but not permanently.
Local 49 has filed an unfair labor practice charge with the National Labor Relations Board, accusing Xerox of surveillance and intimidation after managers showed up and tried to listen in when union members met to exchange information during “unity breaks” in the workplace.
To prepare for a strike, workers are signing strike pledges, wearing yellow stickers that say “I signed the strike pledge,” and taking part in a “unity clap” during shift change.
“Nobody wants to go on strike,” Daniels told the Labor Press, “but people can see themselves not surviving on what the company’s proposed.”
Filice said members are unlikely to strike until at least one more meeting with the company. A meeting was set for Oct. 20.
[UPDATE: Union and management reached a tentative agreement Oct. 20, which the union bargaining team is recommending to the bargaining unit’s 183 members. Members will vote Oct. 25 whether to approve the agreement. Details are not being publicly released until members have a chance to see the agreement.]
[UPDATE 2: Members voted overwhelmingly Oct. 25 to approve a new two-year agreement.]