$10,000 understanding:
Bensman, David
Labor $10,000 UNDERSTANDING STEELWORKERS MAKE CONCESSIONS How BAD was the concessions package granted by the United Steelworkers of America to steel company bargainers? "It smells but it doesn't...
...where does this bitter anger come from...
...They noticed that the concessions agreement established a procedure that, according to Bob Thornburgh, "sets us up for a threat to be shut down by the company unless we agree to withdraw from the Basic Labor Agreement...
...And for one crucial group of presidents, the March agreement appeared to be a lifesaver...
...To begin with, steelworkers gave back a total of $250-400 per month in wages, cost-of-living adjustments, and benefits, depending on inflation, over the course of the forty-one-month agreement, according to an analysis by the Mideast Center for Labor Research...
...And it's true: compared to the concessions proposal which the local presidents overwhelmingly rejected on November 19, the new pact is moderate...
...Behind the local presidents' decision to approve givebacks lay the steel companies' unrelenting pressure to beat down labor costs, and the USW international leadership's passionate conviction that only wage moderation (and import restrictions) can save the steel industry...
...While the concessions package restores the steelworkers' base pay to its current level by February 1, 1986, the cost-of-living adjustments unionists forgo will almost certainly never be restored...
...These were the leaders of the List 3 locals, representing steel warehouses, container factories, fabricating shops, and service centers...
...That adds up to more than $10,000...
...The List 3 Presidents swung behind the concessions agreement, and ensured its ratification on March 2. A week later, things looked different...
...Is that a lot of money to sacrifice...
...On a positive note, the steel companies substantially increased their payments into the supplementary unemployment benefit fund, making possible immediate help for laid-off union members, many of whom are having trouble meeting car and house payments now that their state unemployment benefits have run out...
...THE HIGH COST of concessions and the meager benefits they provide explain why steelworkers have responded negatively...
...All the world has praised the steelworkers' "statesmanship" and "moderation...
...At a time when steel orders are increasing, mills rehiring, and economic prospects brightening (at least temporarily), steelworker local presidents have made the most far-reaching concessions in modern labor history...
...Only government action to redirect corporate investment and stabilize American industry could solve their problem...
...Furthermore, the contract will actually eliminate jobs...
...Finally, let's make a calculation few supporters of labor statesmanship ever perform...
...It does not look imminent...
...The steel companies pledged to "apply the savings received from the moderations contained in this Agreement exclusively to the needs of the existing facilities covered by this Agreement...
...Local presidents sit around the hotels, far from their power bases, waiting anxiously for information about the progress of talks...
...The Company shall not use any of the savings it obtains from such moderations under this Agreement to invest in other business segments of the Company...
...To answer that question, let's transport ourselves to Pittsburgh, in the midst of the fifteen-day bargaining session...
...for the rest of their working lives...
...Furthermore, the companies established a one-time-only early retirement incentive with generous pension supplements...
...Corporate plans to combine and eliminate jobs, speed up work, introduce new technology, and shut "excess" capacity ensure that most laid-off steel workers will never go back to work in the mills regardless of economic conditions...
...Adjusting to the unexpected political currents, two presidents of major midwestern steel locals let it be known that they'd voted against the contract, despite having said the opposite in Pittsburgh...
...Imagine that your own fortnightly paycheck was cut $100...
...And then, at the last moment, international bargainers reveal the contract terms...
...What did the USW obtain in return...
...Molnar's resignation was widely shared by members of the union's Basic Steel Industry Conference (BSIC), who voted 169-63 to approve major wage and benefit concessions on March 2. But when the local presidents left the hothouse environment of the Pittsburgh conference hotels for the ravaged steel towns whose future hung in the balance, they encountered an unexpectedly hostile response...
...abor studies at Rutgers University...
...BUT IT'S DONE...
...As the self-imposed March 1 deadline nears, USW leaders raise the ante...
...It looked like victory...
...It got some of the latter, precious little of the first...
...In November, USW bargainers had acceded to the companies' demands to sever the sixty List 3 locals from the Basic Labor Agreement covering workers in basic steel...
...And the 145,000 steel workers now unemployed...
...It smells but it doesn't stink...
...Unfortunately, Joe Samargia, president of Local 1938 in Virginia, Minnesota, believes that it will be impossible for the union to determine whether or not the companies are carrying out this pledge...
...Faced with such strong pressures, and lacking strong leadership of their own, the local presidents finally yielded...
...DAVID BENSMAN (David Bensman, who previously reported on the steel concessions negotiations in these pages, teaches labor studies at Rutgers University...
...USW Vice-President Joe Odorcich tell local presidents, "If you're not here to make concessions, you might as well go home...
...The union will be the better for it...
...That summed up the attitude of Chuck Molnar, president of Local 2599 at Bethlehem Steel Corporation's Johnstown, Pennsylvania mill...
...And forced the USW to consult more widely than before...
...Regardless of the fine words, the companies' investment decisions will continue to be based on a simple criterion - expectations of future profits...
...Presidents caught between fear of a strike and fear of a membership determined to resist concessions can claim a partial victory - "We forced those companies to scale down their demands, for sure...
...As the euphoric atmosphere prevailing in Pittsburgh wore off, the presidents began to study the fine print...
...In East Chicago, at Inland's Local 1010 union hall, District Director Jack Parton was booed off the stage when he told a packed membership meeting that the unions' concessions to the company weren't "enough" - only a band-aid when the steel industry needed major surgery...
...At the companies' insistence, the USW surrendered the extended vacation...
...The presidents are under unremitting pressure from leaders and staff representatives of the international union to be reasonable, to reach some sort of agreement...
...5,000-7,000 employes will no longer be needed to "fill-in...
...they did not stand for it...
...But it should not be forgotten that their resistance in November forced the companies to moderate their demands...
...Most have little to look forward to...
...The union went into the negotiations seeking job guarantees as well as aid for the unemployed...
...On March 1, the situation seemed different...
...Which is to say that if steelworkers forego $1.00/hr...
...It was the most confusing situation you can imagine down there," recalls Bob Thornburgh, president of Local 1618, Sharon, Pennsylvania...
...This would have inevitably led to drastic gutting of the locals' contracts...
...They rose in revolt and led the successful opposition to the November 19 proposal...
...They did so in sadness and anger, not out of any conviction that their decision would stabilize the steel industry nor generate jobs...
...The new concessions proposal specifically stated that "The Settlement applies in full force to all non-steel producing, non-raw materials units as it has in the past...
...To answer that question, we have to look at the contract...
...Thornburgh now laments, "If I had it to do over again...
...Immediately, the word goes round, "It's much better than November...
...Only Chrysler workers ever took a comparable cut, when their company was going bankrupt and Congress had them over a barrel...
...Or to state it simply, the reinvestment pledge was window-dressing...
...But, one might ask, if the proposal were so unfavorable, why did the local presidents accept it...
...And General Counsel Bernard Kleiman, the USW's chief strategist, was not even allowed to defend his views by the angry Inland unionists...
...But when it came to job guarantees, the USW ended up with . . . words...
...A steel worker working in the mills until the year 2003 could lose more than $40,000...
...in cost-of-living increases during the agreement, they will lose that $ 1.00/hr...
Vol. 110 • March 1983 • No. 6
