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No Surprises as UE
Local Leaders Briefed
On GE’s Billions in Profit


UE General President John Hovis
UE General President John Hovis reports on multi-union preparations for 2000 negotiations

Leaders of UE locals in the General Electric chain were not surprised to learn that their employer is doing very, very well when they received a detailed report on the company’s finances at a meeting of the union’s GE Conference Board here March 23.

In an analysis of data from the recently released GE Annual Report, UE Research Dir. David Alexander pointed out that GE revenues are up 20 percent since 1996, 80 percent since 1993. GE enjoyed net profits of $9.3 billion in 1998 — 13 percent better than 1997 and a gain of 28 percent since 1996.

That profits are increasing faster than sales reflects the ever-growing productivity of GE workers, said Alexander. Last year, each GE worker produced an average of $31,727 in net profits. After-tax profits per worker are up 135 percent over the past 10 years.

Local 506 delegates
Local 506 delegates give their attention to the discussion.

The UE research director revealed that the GE Pension Fund is now 58 percent overfunded, with a surplus of nearly $16 billion. Plan assets are growing twice as fast as benefit obligations. Since 1987, when GE last made a contribution to the fund, employees have contributed over $1 billion — or $6,424 per worker, on average, Alexander said.

One current employee is unlikely to complain about his pension when he leaves the company. CEO Jack Welch looks forward to a minimum annual pension benefit of $4.8 million — a 171 percent replacement rate, Alexander noted.

Starting with a base salary of $2.8 million, Welch’s total compensation in 1998 reached nearly $40 million, the UE research director pointed out. In addition, Welch made more than $46.5 million last year by exercising his stock options; his remaining stock options total $133,620,000.

Local 707 Pres. Larry Harnak (standing); Terry Taylor, Local 751
Local 707 Pres. Larry Harnak reports developments at the Cleveland service shop; Terry Taylor of Local 751 listens in the foreground.

The worrying message in the financial report was the continuing downturn in GE’s U.S. employment despite the company’s prosperity; U.S. jobs have declined 36 percent over the past 10 years.

Most delegates reported steady work at their locations, as well as continuing problems with outsourcing.

At the Erie locomotive plant, Local 506 is working to define plant capacity to offset the effects of a future downturn in orders, said Pres. David Adams.

Local 332 members are responding skeptically to the findings of a GE-funded study that PCBs are not carcinogenic, reported Pres. Joyce Sumner; their plant was at the center of notorious PCB-pollution scandal. Meanwhile, the local has so far successfully blocked the company’s "jackpot" safety proposal, under which workers would receive "prizes" for meeting certain safety criteria established by GE. Bus. Agent Bob Brown told delegates that Local 332 is demanding a full and equal voice on all safety matters, rather than gimmicks which would allow the company to evade its responsibility.

Erie management has restructured its union relations operations, Local 506 Plant Chief Steward David Kitchen reported, but there is "no kinder, gentler GE." The Local 506 unity committee is working to resolve complaints of race and sex discrimination — and avoid disciplinary action — while building unity among GE workers, Bus. Agent Patrick Rafferty said.

Steve Tormey and Local 506 Pres. Dave Adams
Steve Tormey (left), secretary of the GE Conference Board, shares information as Local 506 Pres. Dave Adams considers the agenda. Adams served as conference board chairperson.

Grievance activity has markedly increased during the first quarter of 1999, reported Steve Tormey, Conference Board secretary. Last year saw a record low in national-level grievances.

Genl. Pres. John Hovis led a lengthy discussion on the Coordinating Bargaining Committee of GE Unions (CBC). A meeting of CBC local union leaders in Memphis on June 25 will be followed with a rally in support of workers at the IUE lamp plant there, which is slated for closing.

Delegates heard a report from Political Action Dir. Chris Townsend on the union’s upcoming Political Action Conference and on key areas of anti-labor legislative attack which have resurfaced in Congress.

UE News - 04/99

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