By DON McINTOSH, Associate Editor
Members of Machinists Lodge 1005 voted down a contract offer from Daimler Trucks North America and went on strike at the company’s Portland truck plant 12:01 a.m. July 1. The 520 machinists were joined on strike later in the day by 68 members of Sign Painters and Paint Makers Local 1094. Two other union groups at the plant —117 members of Teamsters Local 305 and 19 members in Service Employees Local 49 — accepted company offers, but won’t be crossing picket lines.
The plant, located in the Swan Island Industrial Park, manufactures heavy-duty Western Star brand trucks used in mining, logging, oil fields and construction. Roughly 725 union-represented workers were turning out 26 trucks a day operating one shift. But they’ve been falling behind economically while the company prospered.
About 415 Machinists Local 1005 members packed a conference room at Holiday Inn Portland Airport at 10 a.m., June 29, for their first glimpse of the company’s “last, best, and final” offer. Bargaining hadn’t wrapped up until 2:55 a.m. that morning, so members had no chance to review the contract beforehand.
“The concession stand is closed”
In the weeks leading up to their contract’s June 28 expiration, Lodge 1005 members had worn union T-shirts with the slogan, “The concession stand is closed.” Now they listened as the union bargaining team explained that the company’s offer would increase wages $1.30 an hour over three years, but would also increase employee health care premiums as much as $45 a month, initiate a more restrictive absenteeism policy, and end the promise of post-65 retiree health benefits for employees who still had that coming. Each of those details drew howls from members.
Machinists District Lodge W24 Business Representative Joe Kear said this was his fifth time negotiating at the truck plant, and that it has been getting rougher each time, as the company tries to squeeze more out of workers.
Talks began June 10, but the union didn’t hear the company’s economic proposal until June 24.
Daimler started off proposing a $4-an-hour pay cut over three years — to make up for additional pension contributions it’s required to make. Daimler is the biggest employer in the Automotive Machinists Pension Trust, a multi-employer pension plan for companies that employ Machinists in Oregon and Washington. The trust had major losses in the financial crash that began in 2008, and participating employers are legally obligated to pay extra to make up the shortfall. Daimler’s rehabilitation surcharge will reach $5.58 an hour by 2015 — and that’s in addition to its regular $4.47-per-hour pension contribution.
The financial crisis may have caused the pension shortfall, but past decisions by Daimler made it worse. Fifteen years ago, the Portland plant had over 2,000 production workers; today there are 725. By shifting production to Mexico and North and South Carolina, Daimler caused the pension to become top-heavy, with relatively few active employees, and many retirees and inactive former employees.
And the company isn’t the only one feeling the pain of the pension losses. The losses forced pension trustees to cut the rate at which benefits accrue, and eliminate supplemental disability coverage and a subsidized early retirement benefit.
The pension surcharge pertained only to the machinists, but Kear said the four unions stood together throughout the joint bargaining. The pay and health care premium increases were the same in all four contracts, which were voted on separately.
Overdue for a raise
Machinists and Painters members determined that the proposed wage increases — 60 cents, 40 cents, and 30 cents — weren’t enough, coming after a four-year wage freeze.
And many workers felt they never really caught up after agreeing to wage concessions in 2001 under company threat of plant closure. Wages were $19.05 then, and are $23.25 today.
Money is not the bottom line. Personal pride is.”
Layoffs — like the 250 workers let go March 1, have swept the assembly line of younger members. Those who remain take retirement benefits very seriously. When during the contract discussion one Lodge 1005 member asked how many in the room were 50 or over, at least half the hands shot up.
Past concessions have created three tiers of retiree health benefits: New hires have no company-paid health benefits when they retire; a previous group gets health benefits until they turn 65 and become eligible for Medicare; the oldest group, numbering 111, gets that, plus supplemental insurance after they turn 65. Eliminating the post-65 coverage was like salt in a paper cut, one worker told the Labor Press.
Despite its flaws, Lodge 1005’s bargaining team recommended approving Daimler’s offer, saying at the time that it was the best they expected to see from the company. But they weren’t surprised at the outcome.
“Money is not the bottom line,” said one Lodge 1005 member. “Personal pride is.”
Of course, money and personal pride are linked. Workers know truck sales are booming and quarterly profits are increasing. Yet their wages have been frozen. Every day to get to work, they go through the employee entrance, passing knee-high weeds by the employee parking lot and crossing railroad tracks. Three years after Lodge 1005 bargained into its union contract a company commitment to improve ventilation in malodorous restrooms, that hasn’t happened. Meanwhile, company managers drive Mercedes Benzes into separate parking lots through landscaping maintained by Local 49 members. They eat in separate areas, and have separate, cleaner, restrooms. To take any concession from an employer, in that context, is a bitter pill.
Pickets began Sunday at midnight, and continue 24 hours a day at three entrances to the truck plant, as well as a fourth location where pre-delivery inspections are performed.