Thirty years ago, labor talks between Whirlpool and its Evansville workers collapsed in a mess.
Rejecting a contract proposal, 7,500 hourly workers struck the company from February to June. Pickets blocked roads, and police were called to clear the plant entrances. Businesses that supplied the company and served the workers closed for lack of business.
When it was over, workers had settled for a lower pay increase than they struck for, Whirlpool had missed four months of business and the community lost an estimated $35 million in payroll and local contracts.
This low was also a turning point in Evansville’s labor relations. Prior to 1974, Whirlpool workers struck in each of the five contract negotiations. Since that strike, Whirlpool workers have struck only once in eight negotiations – that was a strike for 109 days in 1983 – and have agreed to one concessionary contract.
That shift in mood has a bearing on the latest round of contract negotiations between Whirlpool and Local 808 of the International Union of Electricians, which began in December.
“It looks to me like they (Whirlpool’s labor and management) have had two decades of great success, and I hope it will continue,” said Mike Zimmer, professor of economics at the University of Evansville.
The contract, which expires Feb. 19, will cover about 1,800 hourly workers at the Evansville plant. The average worker wage is $15.19 an hour.
Although employment at the Evansville plant has declined in the last three decades and although other large employers have moved into the area, the negotiations between Whirlpool and Local 808 still have an importance beyond the workers and plant itself, experts said.
Of course, if there were a strike, the local economy still would be greatly affected, as striking workers cut back on spending and Whirlpool suppliers feel the pinch, according to Dane Partridge, associate professor of management at the University of Southern Indiana.
But also, “Whirlpool is still a standard-setter in the community,” Partridge said. The company’s contracts are looked at by other workers and management in the community as a measurement of their own wages and benefits packages.
Also, the plant remains a large and important employer that the community wants to keep, said Zimmer. In recent years, competitors such as General Electric have moved production at facilities in Bloomington, Ind., and Louisville, Ky., out of the country.
“If Whirlpool weren’t here and you had a chance to attract their jobs in a relatively non-polluting assembly operation, wouldn’t you want to attract them?” asked Zimmer.
Whirlpool also has importance because of its long tradition of being an important local employer. “You’re talking about a company that is just a part of the community,” Zimmer said. “I just want to see a good citizen stay.”
The improvement in Whirlpool’s labor climate in the last two decades follows a national trend.
“In general, we’ve seen less strike activity in the last 20 years (nationwide) than we saw in the earlier time,” Partridge said.
Among the reasons are a decline in unionization nationwide, a concern that more companies are moving facilities, particularly manufacturing, out of the country and, in general, an emphasis among both labor and management for a less adversarial relationships, Partridge said.
There also has been a decline in inflation, Zimmer said. During the 1970s, workers were struggling to keep up with the rising cost-of-living. But the cost-of-living has been increasing at a more modest rate in recent years, and the pressure to raise wages has eased. With it, the number of strikes has declined. “That’s what inflation does,” Zimmer said.
The lower rate of inflation also means that wage increases, although still important in negotiations, are becoming less important than other issues, Partridge said.
On the other hand, two issues that have grown in importance nationwide and are likely to be bargained over in this round of negotiations are health insurance and job security.
In fact, health-care costs have to some extent replaced wage increases as a battleground, Partridge said. As health-care costs increase, the company and the union dispute who should pay the bulk of that increase. Partridge points out that a large strike involving grocery stores in California is over health insurance benefits.
Manufacturers try to keep their costs low by passing more of the health insurance costs on to employers, experts said. It’s part of being competitive, not only with domestic competition, but also with foreign companies that do not have such high health insurance costs.
For workers, a large increase in health insurance costs can eat up any pay hike – thus, the goal is to have the employer absorb it.
In October, Whirlpool retirees formed an informational picket around the Evansville Civic Center to protest changes in the company-offered insurance coverage.
Health insurance “has to be an issue,” Zimmer said. “All companies are trying to deal with their health insurance.”
As for job security, Whirlpool moved an assembly line to Monterrey, Mexico, in 1996, costing the Evansville plant 266 jobs. The union charged that the company eliminated 60 union jobs when it outsourced plastics-injection molding work to a Henderson, Ky., plant. Thus, in these negotiations, “the union priority will be on maintaining job security, to the degree that they can,” Partridge said. “The management focus is going to be on productivity.”
Although labor relations have improved at Whirlpool and nationally in the last two decades, “There are still issues out there that can lead to disruption and have to be resolved,” Partridge said.
From courierpress.com