DEAL: Daimler and unions reach agreement on a new 5-year contract at the Portland truck plant


Truck GrillWorkers at Daimler’s Portland truck plant ratified new five-year union contracts Oct. 29 by overwhelming margins, with some union members calling it the best company contract offer in many years.

“Members were looking for job security, a general wage increase, and containment of health care costs, and we got all those things,” said lead negotiator Joe Kear of Machinists District Lodge W24. Machinists Lodge 1005 is the largest of four unions at the plant, and bargains jointly with Teamsters Local 305, Painters Local 1094, and Service Employees International Union (SEIU) Local 49.

With all four contracts expiring Oct. 29, the two sides bargained late the night before at the Riverplace Residence Inn in downtown Portland, and reached agreement at 1:30 in the morning. Daimler negotiators initially wanted to increase mandatory overtime and eliminate double time pay for Saturday work. But in the end they backed off those and other concessionary demands, and reached agreement on what Kear described as a very good offer.

The new contracts provide across-the-board hourly wage increases that total $3.25 an hour, starting with a $0.90 increase on Nov. 20, followed by annual increases taking place each Oct. 29: $0.50 in 2017 and 2018; $0.65 in 2019; and $0.70 in 2020.

That means for a production assembly worker with five years of experience — the most common machinist union classification — wages will rise from $24.80 an hour currently to $28.05 by the end of the contract.

The new contracts run through Oct. 29, 2021.

The new contracts contain a modest increase to employees’ monthly contribution toward health insurance premiums, but then holds the line on that amount for the duration of the contracts, regardless of how much overall premiums rise during that time. Employees will pay $65 for employee-only coverage (up from $50 currently), $130 for employee plus one dependent (up from $110), and $195 a month for employee plus two or more dependents (up from $175.) Employees choose between company-sponsored Kaiser Permanente and Blue Cross plans (except for Teamsters members, who get equivalent health insurance through a union trust on the same terms.)

Daimler will continue to contribute $4.47 an hour toward the Machinist-sponsored multi-employer pension plan, plus a $6.15-an-hour rehabilitation surcharge meant to forestall insolvency. [The plan lost assets in the 2008 financial meltdown and has had trouble recovering, in part because there are many fewer active employees than there used to be at Daimler and other employers.]

The new contracts also stipulate a tobacco-free workplace by 2018. Employees won’t be allowed to use tobacco of any kind on the premises, and given the distance from the plant floor to the street, it’s unlikely they’d be able to use tobacco during breaks.

The contracts also provide a measure of job security. While Daimler isn’t guaranteeing it won’t close the Portland truck plant, it committed to a generous severance package, suggesting it’s not planning to close: In the event of a permanent plant closure, workers will get two weeks of pay for every year they’ve worked there.

The Portland truck plant, located in the Swan Island Industrial District, employs about 500 workers (350 Machinists, 85 Teamsters, 50 Painters, and 18 members of SEIU). It produced Freightliner trucks until 2007. Today it’s one of two Daimler Trucks North America plants producing Western Star brand trucks (The other is in Cleveland, North Carolina). The Western Star line includes heavy-duty vehicles like dump trucks, cement mixers and tow trucks; specialized off-road vehicles for mining and other applications, and high-end extra-durable over-the-road trucks. Production of Western Star trucks is down, and layoffs earlier this year led some workers to worry about the future of the brand, but Kear says Daimler has a goal of increasing the company’s market share to 8 percent, up from 2 percent currently.

Three years ago, contract negotiations at the Portland plant were much more acrimonious. Machinists and Painters members at the plant struck for 22 days — and still gave up company-provided MediGap coverage for new retirees. This time, Kear said, management seemed to listen better, and came up with contract offers that workers were happy with.

The four contracts were ratified by lopsided margins. Machinists voted 248 to 15 to approve it (a second Machinist bargaining unit at pre-delivery inspection, now called Custom Truck Services, also approved it 10-1.) Teamsters approved it by 79-1, Painters by 44-2, and SEIU by an unspecified margin.


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