Despite earning a record $4.9 billion profit last year and projecting even better results for 2012, the company is insisting on a six-year wage freeze and a pension freeze for most of the 780 production workers at its factory here. Caterpillar says it needs to keep its labor costs down to ensure its future competitiveness.
The company’s stance has angered the workers, who went on strike 12 weeks ago. “Considering the offer they gave us, it’s a strike we had to have,” said Albert Williams, a 19-year Caterpillar employee, as he picketed in 99-degree heat outside the plant, which makes hydraulic parts and systems essential for much of the company’s earth-moving machinery.
Caterpillar, which has significantly raised its executives’ compensation because of its strong profits, defended its demands, saying many unionized workers were paid well above market rates. To run the factory during the strike, the company is using replacement workers, managers and a few union members who have crossed the picket line.
The showdown, which has no end in sight, is being closely watched by corporations and unions across the country because it involves two often uncompromising antagonists — Caterpillar and the International Association of Machinists — that have figured in many high-stakes labor battles.
“Caterpillar has been a leader in the past 20 years in taking a hard line,” said Richard Hurd, a professor of industrial relations at Cornell. Last winter, Caterpillar locked out about 450 workers at its locomotive plant in London, Ontario, and then closed the factory after the union rejected its demand to cut wages by 55 percent. In the mid-1990s, the company vanquished the United Automobile Workers after a 17-month strike by 9,000 workers at eight factories; the union surrendered and accepted the company’s concession-filled offer.
The machinists have carried out largely successful strikes at Boeing and Lockheed Martin, ultimately winning better raises and benefits for thousands of members.
Robert Bruno, a labor relations professor at the University of Illinois, said Caterpillar was trying to drive compensation down to a new floor. “Caterpillar sees this as ‘the new normal,’ while this union local feels you have to draw a line in the sand to hold on,” he said. “Some people are saying the union should be more deferential, more compliant, that it’s a bad time to strike. How can you counter a powerful multinational in this economy?”
- Steven Greenhouse, Profitable Caterpillar Pushes Workers for Concessions via NYTimes.com
There’s no bottom to this. With unprecedented profits, the management of Caterpillar see the workers making its products as an impediment to more profits, not as human beings who have a right to share in the outcomes that their work has led to. Caterpillar looks at the guy on the assembly line the way a butcher looks at a chicken: wondering how to get more meat off the bone.
Isn’t this a chance for Obama to stand up for the working class, by the way? Isn’t this egregious enough?
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