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UE - General Electric:
Contract 2000 Ratified

Negotiations that went beyond contract expiration for the first time in recent history in the end produced an acceptable national agreement with General Electric, approved by a substantial majority of UE’s GE membership as locals voted from coast to coast.

In Ontario, Calif ...

In Ontario, Calif., like other locations, GE workers take pride in their work — and insisted on a contract they could be proud of, too.

At the June 3 rally in Erie, Pa ...

At the June 3 rally in Erie, Pa., attended by some 2,500.

Union pride ... Campbell, Miller and Wojtowicz ...

Union pride: this Erie GE worker had ‘Local 506’ painted on his back, to match!

Pat Campbell, Carol Miller and Pat Wojtowicz of Local 731, Conneaut, Ohio GE at the Erie, Pa. rally.

Cramer and Jelinek ponder contract offer ... Gonzales and Bradley (in foreground) ... Hovis, Rafferty and Tormey

Donna Cramer and Mike Jelinek of Local 506 ponder the settlement. Later, they and other delegates to the UE-GE Conference Board meeting  voted unanimously to recommend ratification.

Local leaders at the June 28 meeting of the UE-GE Conference Board; in the foreground are Nita Gonzales and Ted Bradley of Local 1010. Genl. Pres. John Hovis (in foreground), Local 506 Bus. Agent Pat Rafferty and Steve Tormey, secretary of the UE-GE Conference Board.

Each time negotiations get more difficult," said Patrick Rafferty, the business agent of UE Local 506, describing what it’s like to bargain with the world’s most powerful corporation. That assessment seemed particularly true in 2000.

Despite its publicized intention to negotiate a "fair and generous" contract, GE came to the table with goals that included major cost-shifting in medical insurance and a contract term of five or more years.

Through rallies and shop-floor activities, UE members loudly and clearly backed their negotiating committee through four weeks of often tense bargaining.

UE is one of two unions with a national agreement with GE and participates in the Coordinated Bargaining Committee, a coalition of 14 unions representing some 32,000 GE workers nationwide.

Negotiations opened May 30 in New York, beginning three weeks of talks between the UE committee and the company. During the fourth week, Genl. Pres. John Hovis and Stephen Tormey, secretary of the UE-GE Conference Board, joined representatives of four other unions (IUE, IBEW, IAM and UAW) in "small-table" bargaining with top GE officials. Meanwhile, UE rank-and-file leaders joined other CBC members facing the company on subcommittees dealing with insurance and pensions and contract language.


From the beginning, UE pressed for what Pres. Hovis called in his opening statement "a well-balanced agreement" addressing a range of worker concerns, including substantial improvements in wages, medical insurance, pensions and job and income security.

Hovis laid out the themes that the UE committee would return to repeatedly over the next month:

GE can easily afford contract improvements; GE workers should be rewarded for their impressive productivity gains; the $25 billion overfunding in the pension trust is used to make GE’s bottom line more attractive to Wall Street investors when it should be used to pay for major pension improvements; GE has no serious competition; rampant job insecurity requires a number of contract changes; as GE’s aggregate medical costs have gone down by 20 percent since 1992 (and not increased), the company’s cost-shifting should be halted and reversed.

The company’s opening statement stressed GE’s goals of "flexibility" and "competitive ability" in a contract of five or more years.

Both the union and company bolstered their arguments with formal presentations, projecting facts and figures on screens.


As Pat Rafferty reminded GE, the union’s proposals came out of the real-life experiences of GE workers over the past three years. Those experiences were given force by the clearly reasoned, forcible arguments of committee members.

"We are proud to be GE employees, we want a contract we can be proud of," said Lynda Leech, Local 618, Erie, Pa. salaried workers.

"I’m here to let you know that my local opposes any more cost shifting on the medical insurance, we want the medical improved," declared Pat Campbell, Local 731, Conneaut, Ohio. Joyce Sumner, Local 332, representing Fort Edward, N.Y. workers, wholeheartedly agreed: "The message from my members is that insurance should not be any more expensive than it is already."

GE repeatedly told the union that future contract improvements can’t be based on the record-breaking profits of the past three years. Or, as David Adams, Local 506 president put it, the company wants to know what we will do for GE tomorrow, after three years of tomorrows. Record levels of production should give GE workers a better contract, he said.

The UE committee hammered at the company demand for a longer contract term. "I would be hard-pressed to go back to my location and say we have an extended contract," said Bill Callahan, Local 751, Niles/Mahoning. "I expect three years is long enough to make adjustments and make sure we meet the needs of our members."

The UE local leaders also hit on the need for job and income security improvements, early retirement and more paid time off because of the pressure-cooker conditions of "management by stress." "We live in a turbo-charged environment of purposeful insecurity," said Stephen Tormey.


Was the company listening? When the CBC small committee met with company officials on June 19 — less than a week from contract expiration — GE still insisted on a five-year (or longer) contract and more insurance cost-shifting. GE told the unions that the $25 billion in pension overfunding was irrelevant to the level of pension benefits and that the present wage and benefit package already allowed the company to "attract and retain" quality employees. And GE made clear its unwillingness to accept limits on its ability to move or eliminate jobs.

This was, as the bulletin posted on the UE Website explained, GE’s usual tactic of driving down expectations.

The bulletins over the course of the final week of talks reported a slow pace of progress and major differences remaining even as time was running out. Over the final weekend, the unions and company began to close the gap, but failed to reach a settlement by the midnight deadline — or by 2 a.m. Monday, June 26, when the talks recessed. The unions did not get GE’s final position until around 12 noon.


Meanwhile, the UE membership had been busy in support of its contract demands.

The CBC sponsored a series of rallies during negotiations; by far the biggest and best organized was the rally hosted by UE Locals 506 and 618 in Erie, Pa. on June 3. With the top three officers of Local 506 occupied with negotiations, an extensive committee of rank-and-file volunteers, with assistance from the Retirees Association of General Electric (RAGE), organized the entire event.

Some 2,500 attended the rally, coming from a number of unions and GE locations, although most of the participants were Erie GE workers and members of their families.

Some of those same Local 506 members wore band-aids on their noses on June 21 in response to the foul odor of GE’s proposal for a medical-insurance "reverse COLA" and took part in "band practice" and other activities, including informational picketing, during the final week.

Local 1010 members in Ontario, Calif. rallied outside the plant on June 16 and — just in case the company didn’t get the message — again on June 23.

Each and every member of Local 751 at the Niles and Mahoning Glass plants in Niles, Ohio signed a petition backing the union’s positions, copies of which were delivered to GE officials at negotiations in New York. At the Conneaut, Ohio lighting plant, meanwhile, Local 731 members were filling out rosters for picket duty. Local 332 members in Ft. Edward, N.Y. — already warmed up by a four-day strike in May — wore snake-adorned T-shirts bearing the slogan, "If provoked, I will strike."

"Speaking for my local, I’m extremely proud of the support they gave me and the union bargaining committee up here," commented Bill Callahan, Local 751. "The leaflets and the things they did back home made a tremendous difference. They were extremely supportive, and willing to take the company on."

UE members did an outstanding job of getting their message across in the shops — and "that’s where the agreement comes from," said Pres. Hovis.

The UE negotiating committee gave its approval to tentative agreement on June 27; the UE-GE Conference Board voted unanimously the next day to recommend ratification by UE locals.

Enthusiasm for the agreement varied. "It’s mediocre, but not enough to strike on," commented Nita Gonzales of Local 1010. Chris Barrickman, Local 731, thought it was "a very good contract. It seems like everyone’s getting something out of it, at least," he said. Betsy Potter, Local 618, pointed out that "the company wanted a lot more [insurance] cost-shifting." "Overall, it’s good, but there are things that could have been better," suggested Bill Callahan.

David Kitchen, Local 506, thought that the language on the Job Preservation Steering Committees was "significantly better."


"It’s been tough, I knew it was going to be tough," added Bob Brown, Local 332. "We did the best we could." Brown praised the UE committee as "a great crew to work with."

Barrickman, who was attending his first national negotiations, was particularly grateful for the support from the veterans. "They guided me through the whole process."

Another first-timer, Joyce Sumner of Local 332, admitted to being nervous at first until she realized that the GE officials sitting across the table in national negotiations were no different than the GE bosses she dealt with back in the plant. "GE is tough, but UE is stronger," Sumner said.

Part of that strength came from communication. Daily summaries were posted on the UE Website throughout much of the negotiations, and were printed and mailed to each local during the first three weeks. "The Web was great, our folks in California knew what was going on here in New York," said Nita Gonzales. Although she and Ted Bradley would call every day with a report, Local 1010 members had already downloaded the UE negotiations bulletin and knew what had taken place at the table. "The Web made all the difference in the world," said Betsy Potter. Bargainers from other CBC unions made use of it, too, she said.

Pat Rafferty, Local 506, agreed that the contract could easily have been worse, and said it would have been were it not for the tireless efforts of Pres. Hovis and Tormey at the small table during the final week. "If anyone is to be commended, it is you and your membership," Hovis told the UE bargaining committee. The union would have been "stuck in the sand," he said, without the high caliber of rank-and-file leadership from the locals.


Under the terms of the 2000-2003 agreement, wages will be increased by 4 percent the first year, 3 percent the second year and 2.5 percent the third year. The cost-of-living adjustment continues, uncapped, with an improved formula of one cent for each .10 percent rise in CPI-W, with six adjustments covering a 32-month period. The new COLA represents about a 10% improvement over the preceding formula in inflation protection.

The contract contains a wage structure adjustment: Effective June 26, 2000, one cent per hour (40 cents per week for salaried) will be added to all rates at or above $18.63 per hour, or R-18 if lower, with an additional one cent for each 15-cent wage bracket with no maximum.


The Guaranteed Minimum Tables are increased to a range of $28 to $40 and are also improved to provide for pension multiplier increase for employees in the middle of the tables. Effective next year, the Regular Career Formula is improved by accruing service beyond 34 years on the same basis as other service (previously was a flat 1.45 percent). Also, the "break point" between 1.45 and 1.9 percent accumulation rates is frozen beginning next year at $30,000, instead of floating upward with the rise in covered compensation.

The Career Pension Update will enrich pensions of those retiring under the career earnings formula. It applies to employees with 25 or more years or those who were at least 55 with 20 years as of Dec. 31, 1999. The update has a guaranteed $250 minimum improvement; it’s effective Dec. 1, 2000 for pensions beginning on July 1, 2000 or later. The update alone will yield, on average, an increase of about $2,4000 in the annual pensions of eligible UE members.

The Regular Supplement is increased from $13 to $14 for employees retiring between ages 60 to 62. The Special Supplement is increased from $325 to $350 for those retiring within 3 months of attaining age 60 with 25 or more years of PQS.

A new feature, a Supplement Extender will result in the regular and special supplements running beyond age 62 until the age at which one qualifies for 80 percent of Social Security. Describing this as "a very significant provision," Pres. Hovis pointed out that this will allow some GE workers to retire a year, possibly two years, earlier than they otherwise would.

Survivor Options are improved with the addition of an immediate 100 percent option. The two-year wait for the 100 percent survivor benefit is eliminated. Reduction factors are lowered for SERO and PCPO retirees.

The Disability Pension will be reduced by a range of 2 to 10 percent for employees ages 55-59, a significant improvement over the previous flat 12 percent reduction. This was the first change in this area in many years.

An Early Pension Payout Option will be available to employees with at least 25 years of PQS who terminate service after a job loss event including layoff. Employees so affected going back to June 1988 are eligible to begin receiving a pension as early as age 55. The pension benefit will be reduced 5 percent per year from age 60 to 55.


UE argued long and hard for elimination of the employee pension contribution. The contribution continues, but workers will be parting with less of their take-home pay. The threshold at which the 3 percent pension contribution kicks in will be raised next year from $30,000 to $37,500 of annual earnings — resulting in savings of $225 per year in after-tax money.

The new contract renews the Special Early Retirement Option (SERO) for employees ages 55-59 with 25 years of PQS affected by a "job loss event." SERO 30 also renewed. The SERO "Window" is reopened and the replacement pool is broadened to include upgrades and qualified new hires. However, eligibility will be limited to the 850 applicants nationally who have the most Pension Benefit Service (PBS). This will apply to hourly and non-exempt employees. Applicants must retire on Oct. 1 or Nov. 1, 2000, and must apply by Sept. 1, 2000.


The Plant Closing Pension Option (PCPO) is renewed. PCPO retirees with 25 years or more PQS will now receive dental plan coverage until age 65.

The Rate Guarantee of 78 weeks is extended to employees displaced or laid off within six months of subcontracting work that had no initial adverse impact on employees performing such work. The Special Retirement and Voluntary Layoff Bonuses are increased by $2,500 to $12,500 for employees age 60 with 15 or more years PQS. The Education and Retraining Bonus in event of plant closing is doubled to $10,000.

Job Preservation Steering Committees are extended to units of 50 or more employees, with number of meetings increased to at least four per year, and their right to information and mandate are broadened. The extensive changes to this contract language, said Pres. Hovis, include opportunities for the union to preempt potential job loss, instead of only reacting to company announcements. There are provisions for business-level discussions and national UE and corporate oversight. An up-to-two-year moratorium against job loss applies to all work preserved through JPSC proposals.

The number of preferential placement locations increased from three to five. Hiring standards are to be liberalized with 90-day trial period for employees with 25 or more years. Relocation Assistance under preferential placement increased to $2,500 for single employees and $5,000 for those with dependents, up from $2,000 and $4,000. The Income Extension Agreement repayment obligation applicable to those hired under Preferential Placement is eliminated.

The plant closing notice is doubled from six months to one year. A six-month notice of transfer of work is extended to non-production jobs where 50 or more employees are affected by a proposed transfer. The subcontracting notice is extended to jobs subcontracted which result in no decrease of employment.


In the medical insurance area, GE openly stated that significant cost shifting to employees was a major bargaining objective. GE’s attack centered around a "reverse COLA" concept — employee contributions would automatically rise every year based on any increases in GE’s "family unit" insurance costs. In addition, GE also proposed significant hits on retirees’ prescription drug coverage.

While the union prevented these and other cost-shifting changes sought by the company, contributions for both the managed-care plan, Health Care Preferred (HCP), and the traditional Comprehensive Medical Benefits (CMB) plan will increase by $50 per year for individual coverage and $50 for dependent coverage. These contributions are "locked in" for contract term. In addition, GE succeeded in increasing mail-order prescription co-pays for active employees from $12 to $20.

However, the negotiations did produce a number of insurance improvements.

The weekly Sickness and Accident benefit is increased by $75 to $475. Long-Term Disability Insurance minimums are increased by $50 for all three benefit options. Lifetime maximum heallth-care benefits are increased from $1.5 million to $2 million.

Preventive care schedules under CMB are increased, and coverages for cervical cancer screenings, prostate exams and colonoscopies are added for both CMB and HCP. Also, coverage is added for prescription birth control products and doctor-provided contraceptive services, as is coverage for adult immunizations and annual cholesterol screening under CMB.

Well baby care is added to CMB, extending coverage for pediatric examinations at birth, up to 11 doctor visits and immunizations up to 6 years old. Co-pays for well baby care and immunizations are eliminated under HCP.

The hearing aids benefit increased to $1,500 every 3 years for two hearing aids, exams, and repairs, with no co-pays.

Mental health/substance abuse coverage will include coverage for out-of-network providers at appropriate benefit level with no deductible. New coverage will be available at 50 percent of "usual, customary and reasonable" for work performed by practitioners with Masters of Social Work (MSW) degrees.

Coverage for diabetic supplies is added under both the retail and mail prescription options. Vision benefit schedules are increased with new coverage for bifocal contacts. Vision care for children up to age 19 will be based on an annual schedule of benefits instead of every 2 years.

The dental schedule is increased, effective Jan.1, 2002. The orthodontia lifetime maximum is increased by $500 to $2,000; the restorative and prosthodontic maximums are raised by $300 to $2,000 every 2 years. A new High Option Dental Plan will be offered for contribution of about $6.00 a month for employee and $6.00 a month for dependents. Employees may switch into or out of the plan annually.

Other changes include an increase in the lifetime maximum is increased in pensioners’ medical plans (MCPP and PHIP), coverage for extended care facilities without the need of a prior hospital stay, and new coverage for participation in federally supported clinical trials.


Also, the bereavement benefit is expanded to cover parents and step-parents for five days and to include step-grandparent and step-grandchild in the list of covered relatives for three days. The scholarship program benefit to children of deceased employees is increased to $12,000 maximum and the adoption assistance benefit is doubled to $4,000.

The Individual Development Plan (IDP) maximum is increased to $4,000 per year, with maximum for non-job related courses raised to $1,500.

The apparatus service shop safety shoe allowance is increased to $125 a year and may be applied to other approved personal protective equipment.

New to the UE-GE national agreement is the union’s right to participate in new-hire orientation to explain benefits of union membership and the right to register voters on company property.

Over the four weeks, the UE negotiating committee consisted of Genl. Pres. John Hovis, Stephen Tormey, secretary of the UE-GE Conference Board, Bob Brown and Joyce Sumner of Local 332, David Adams, David Kitchen and Patrick Rafferty of Local 506, Betsy Potter and Lynda Leech of Local 618, Chris Barrickman, Pat Campbell and Pat Wojtowicz of Local 731, William Callahan of Local 751, and Ted Bradley and Nita Gonzales of Local 1010. Intl. Rep. Chris Townsend represented UE at the IUE table and participated in the "large table" subcommittees during the final week. Research Dir. Lisa Frank’s assistance to the committee included a presentation on GE finances. Rick Peduzzi developed and maintained the UE-GE bargaining website; UE NEWS Managing Editor Peter Gilmore prepared daily and weekly bulletins during the first three weeks of negotiations.

UE News - 07/00

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