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Striking Caterpillar workers rally at Joliet plant

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Updated: June 14, 2012 8:21AM

Just a week before Caterpillar workers in Joliet went on strike the company reported record quarterly profits.

At the same time that the company is prospering, management has proposed a final offer that the Machinists union sees as another round of concessions that follows the model of past contracts in which workers took wage freezes and accepted lower pay rates for new employees during lean years.

Caterpillar says it needs to base wages on what’s competitive in the marketplace.

But the contrast between corporate profits and a company’s proposal for concessions made for a ready theme of “corporate greed” at a strike rally Friday. Speaker after speaker talked about big corporate profits, millions of dollars in extra pay for company executives, and the plight of middle-class America.

The Machinists union, which represents about 780 workers at the Joliet facility, went on strike May 1 after a final proposal from the company that the union said included no set raises and even the potential for pay cuts in the next six years.

“You made the company more prosperous year after year,” Tom Buffenbarger, president of the International Association of Machinists and Aerospace Workers, told strikers at the rally. “They reward those that have never done what you do and they want you to give back what you have earned. This is not about America going backward. This is about America going forward.”

No doubt striking Machinists see themselves going backward if they accept the contract terms proposed by the company.

“They want to take too much away,” said Tom Blatt of Joliet, who has worked at the Caterpillar plant for more than three decades. “It’s time to take a stand. Even the young guys see it. That’s why they’re out here.”

Steve Zabin marked one year of Cat employment last week, but he was on strike, not on the job.

Zabin said he would expect his income to go down if the company proposal is accepted. The proposal includes higher contributions for health care and something called “market-based wage adjustments” for newer employees like Zabin. Those adjustments could go down as well as up, the union says.

“Over the six-year contract,” Zabin said, “we’d be down $4 an hour the way they want to do things.”

Caterpillar certainly wants to maximize profits, said Lawrence Hill, chairman of the economics department at Lewis University in Romeoville. But, he added, that’s what the company shareholders want to see.

“The pressure on Caterpillar is to make as much money as they can,” Hill said. “Their biggest cost is labor.”

Hill sees the clash between Caterpillar and the Machinists as a continuation of the labor fights that go back to the 1980s when manufacturers began cutting costs and looking for new ways to compete in the global marketplace. One of the classic battles of that era was Caterpillar and the United Auto Workers. Caterpillar won.

“The unions have been backing off, backing off, backing off,” Hill said.

Hill, however, does not see the Machinists strike in Joliet as hopeless. Big unions like the Machinists, he said, have added economic expertise in their offices and do their own analysis of markets to measure the prospective success of labor actions.

“These guys have put their heels in the grass. That means they must know something we don’t,” he said. “There’s some key expertise here that allows the union to think they can stand up to them.”

By “expertise,” Hill does not mean just the economists at Machinists headquarters, but also the Machinists working in the factory, some of whom have decades of experience working on the hydraulic parts manufactured at the Joliet plant.

Steve Westhoff of Plainfield has worked at the Joliet plant since 1973.

“It takes a lot of years to run those machines right,” Westhoff said. “Those machines are very complicated machines.”

Management, Westhoff said, is constantly looking for ways to standardize production to become less dependent on the expertise of the Machinists.

“They do not want to recognize the workers for their expertise and experience,” he said.

Caterpillar spokesman Rusty Dunn said the company is constantly looking for ways to compete better in a worldwide marketplace.

Wages in Joliet and elsewhere, he said, are not linked strictly to the company’s profits but to competition with other companies in the same industry.

“Pay and benefits need to remain competitive in the industry,” he said. “The issue is not solely profitability. ...This is about the need to be competitive at all levels.”

Dunn noted that employees in Joliet and elsewhere share in the company’s profits through a short-term incentive plan that provides lump-sum payments when Caterpillar does well.

Union members, however, say the incentive plan adds nothing to their wage scales. They see themselves as losing ground as the company becomes more competitive and profitable.

Joliet Mayor Thomas Giarrante and Will County Executive Larry Walsh also spoke at the rally.

“I will do everything I can,” Walsh said. “I will make whatever calls I have to make to get the doors open so you can go back and negotiate.”

What’s happening in Joliet is not unique, said Robert Bruno, a labor studies professor at the University of Illinois in Chicago. Unions that make concessions in lean years are finding that they don’t gain back what they lost once the company profits.

“Unions begin to believe this is not a short-term sacrifice. This is the new normal,” Bruno said. “Employers are trying to impose a new wage structure. ...You either surrender to it or wage some kind of last stand.”

Westhoff said he has not had a wage increase, other than cost of living adjustments, since 1993. But he’s making about $25 an hour and is close to retirement. The prospect of no wage hike for years to come is more daunting to younger workers, he said.

“We’ve got a lot of young guys,” said Westhoff, “who said, ‘I’m making $14 an hour. It’s the most I’ve ever made. But I won’t sign this contract because it means I’ll never make more than $14 an hour.’ ”

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