In the same week Indiana became the latest state to enact a union-busting right to work law, Caterpillar announced it was closing its main locomotive plant in London, Ontario, where workers have been locked in a labour dispute, and moving production to a non-union plant it has set up in Muncie with up to $28 million in state and municipal aid. Caterpillar demanded that Canadian Auto Worker employees at the Ontario plant agree to slash their pay in half - the rate it is offering to eager job seekers lining up in Muncie today. Caterpillar earlier advertised for personnel managers in Muncie with experience "providing union-free culture and union avoidance." The stepped up war against the unions in North America and Western Europe continues.
* * * Caterpillar Closes Plant in Canada After Lockout By JAMES R. HAGERTY Wall Street Journal February 4 2012 MUNCIE, Ind.—Bulldozing its way through a high-profile dispute over wages, CaterpillarInc. said Friday it will close a 62-year-old plant in London, Ontario, that makes railroad locomotives, eliminating about 450 manufacturing jobs that mostly paid twice the rate of a U.S. counterpart. Caterpillar's decision, ending a standoff with locked-out workers huddled around barrels of burning scrap wood outside the London factory gates, may benefit another downtrodden manufacturing city: Muncie, Ind., where Caterpillar last year opened a locomotive plant and where it is trying to fill jobs at about half the pay workers in Ontario received. At a job fair in Muncie Saturday, Caterpillar will be offering jobs at that plant at wages ranging from $12 to $18.50 per hour. Wages for most workers at the Ontario plant are about 35 Canadian dollars an hour (US$35.03). "The cost structure of the operation (in Ontario) was not sustainable and efforts to negotiate a new, competitive collective agreement were not successful," Caterpillar said in a statement Friday morning. It added: "The gulf between the company and the union was too wide to resolve." The Canadian Auto Workers union, which represents the workers, called the move "truly rotten behavior. They are immoral, they are unethical and they are greedy," said union president Ken Lewenza in an interview. He said he believed the company had no intention of keeping the plant open and demanded steep wage cuts that weren't acceptable to the union. Caterpillar, he said, informed him of its decision 10 minutes before it issued its news release. He was also angry at the federal government of Prime Minister Stephen Harper and the provincial government for not intervening. "We sympathize with the workers in London," said Richard Walker, a spokesman for Canada's industry ministry. He defended the federal government's record of protecting Canada's manufacturing sector but said the dispute was regulated by the provincial government of Ontario. Linda Jeffrey, Ontario's labor minister, said in an interview that the ministry's mediators "tried over and over again" to get Caterpillar back to the bargaining table. "I think it's shameful that this company made so little effort to get out and make a fair and balanced deal with the workers," she said. Rusty Dunn, a spokesman for Caterpillar, said the company had no comment on the criticism from the union and Canadian officials. Caterpillar's announcement came on the same day Canada released much-worse-than-expected jobs data, underscoring its tenuous economy. Canadian employers hired far fewer workers than expected in January, adding just 2,300 net new jobs, and the jobless rate rose unexpectedly from 7.5% to 7.6%, the highest level since April 2011, Statistics Canada said. Meanwhile, the U.S job market notched significant gains in January, adding 243,000 nonfarm jobs, the fastest pace since April, while the unemployment rate fell to 8.3% from 8.5%. The 50,000 manufacturing jobs added last month was the highest monthly gain in factory jobs since August 1998. Caterpillar, based in Peoria, Ill., had been pressing the CAW for more than six months to accept a new contract with wages about half the previous levels. On Jan. 1, Caterpillar locked out the Ontario-plant workers, saying it would halt production until they accepted new terms. CAW leaders said recently they were unwilling to accept wage cuts but were willing to explore concessions, including reduced vacation time. The Ontario plant was Caterpillar's main center for assembling locomotives in North America. Caterpillar said the work will be shifted to other unspecified plants in North and South America and that deliveries won't be delayed. Aside from the new Muncie plant, Caterpillar is setting up a locomotive plant in Brazil and has a longstanding agreement under which Bombardier Inc. of Canada makes locomotives for Caterpillar in Sahagun, Mexico. Engines for the locomotives are made at a Caterpillar plant in LaGrange, Ill. Muncie doesn't know if it will benefit from London's loss. But Mayor Dennis Tyler said if Caterpillar jobs are moving out of Canada, "of course I'm going to try to get them here." He added: "If (they) came here, there'd be people standing in line here for days" to apply. When Caterpillar agreed to revitalize a former Westinghouse electrical-equipment plant in Muncie that had been idle for 12 years, state and city officials provided incentives that could reach about $28 million, assuming Caterpillar meets its goals for adding as many as 650 jobs. Those incentives include tax credits, infrastructure improvements and worker-training funds. If Caterpillar increases its investment in Muncie to replace the Ontario capacity, Muncie officials said it may qualify for further incentives. "We're going to do all we can to help them," said Jay Julian, chief executive officer of the Muncie-Delaware County Economic Development Alliance. Caterpillar has made clear it hopes to avoid any union representation at the Muncie plant. Last year, an online job advertisement published by the company sought human-resources managers with "experience with providing union-free culture and union avoidance." In an effort to attract more union-shy employers, Indiana Gov. Mitch Daniels on Wednesday signed a "right-to-work law," barring labor contracts that require all workers to pay union dues. Mr. Julian, the county economic-development official, said site-selection experts for manufacturing plants have told him that about 30% of such projects specify that the factories go to states with right-to-work laws. "We obviously want to compete for those," he said. Indiana this week became the 23rd state with such a law and the first to enact one since Oklahoma did a decade ago. Caterpillar's decision to close a unionized plant contrasts with its bigger rival in production of locomotives, General Electric Co. GE last June signed a new four-year contract with union workers at its locomotive plant in Erie, Pa., including a wage increase of 2.25% for 2012. Workers at the Erie plant now earn between $25 to $36 an hour, according to Roger Zaczyk, local president of the United Electrical, Radio & Machine Workers, one of the unions that represents workers there. Mr. Zaczyk said most welders at GE's Erie plant earn about $32 per hour. By contrast, Caterpillar is offering $14.50 an hour to welders at the job fair in Muncie Saturday. While keeping the peace with unions in Pennsylvania, though, GE also is converting a warehouse into a second U.S. locomotive-making plant in Fort Worth, Texas, a state where union membership is low The plant is expected to begin production and employ 500 workers. In October, GE announced a $95 million expansion of that Texas plant to make electric-drive-wheel systems for mining equipment. Muncie lost thousands of jobs over the past decade as the U.S. auto industry shuttered plants making vehicle parts. In 2009, BorgWarner Inc. closed a local auto-transmission plant after the United Auto Workers local refused to renegotiate a contract two years ahead of its expiration. That plant remains idle. In recent years, Muncie, home of Ball State University, has attracted other employers, including Sallie Mae, a student-loan company, which set up a debt-collection office, and Italy's Brevini Power Transmission, which makes gear boxes for wind turbines. Both Muncie and London have suffered from the loss of auto-related jobs and have unemployment rates between 9% and 10%. "We are clawing ourselves back," London Mayor Joe Fontana said in an interview Thursday. "We can be competitive." _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
