GE, unions reach tentative agreement

Update: GE workers have approved the new contracts. For more details, see the comments.

 

GE and its two largest unions, IUE-CWA and UE, on Sunday reached a tentative agreement on a new four-year contract. “While the proposal contains important improvements and advances, it also contains certain disappointments,” said John Hovis, president of UE. “However, given the current economic climate overall it’s an agreement we can support.”

Delegates from UE locals will begin reviewing the agreement on Tuesday, and delegates from IUE-CWA locals will begin Wednesday. Delegates from both locals will vote Wednesday on whether to accept or reject the agreement. If the delegates vote to accept the agreement, then members will vote on it. The membership vote should be complete no later than June 30.

Hovis said that there are many changes to the new agreement, and he wanted to make sure that local leaders and members have plenty of time to read and discuss the new contract. UE will post a detailed summary of the agreement on Wednesday afternoon. IUE-CWA has already posted a short summary of the agreement.

The tentative agreement increases pay, increases worker health care expenses by 2.5 percent, keeps intact the special early retirement option for workers facing layoffs, and boosts pension payments. It also allows GE to move new hires into a defined contribution pension plan.

If approved workers would receive a cash payment of $5,000 in July, then a 2.25 percent pay increase in 2012, 2.5 percent in 2013, and 3 percent in 2014. There will also be eight opportunities for cost of living increases during the course of the contract that could raise wages by as much as $1.13 an hour.

The tentative agreement also establishes a health plan for union workers that is separate from the health plan for salaried, non-union workers, who pay 35 percent of their health care costs. The new plan for union workers will increase out-of-pockect health care costs from the current level of 21.5 percent to 24 percent.

New hires will no longer be allowed to enroll in GE’s defined benefit plan, which provides a guaranteed pension benefit for the lifetime of the worker. Instead, they will be diverted into a 401(k) plan, also known as a defined contribution plan. There was some concern that barring new hires from the defined benefit pension plan would lead GE to demand a freeze in pension payments for workers already enrolled in the defined benefits plan, but the company said that it would not ask for a freeze when bargaining on a new contract begins in 2015.

For the new hires, GE agreed to make an automatic payment of $600 into the 401(k) plan plus contribute 3 percent of a new hire’s salary to the 401(k) plan. In addition, GE will match new hire contributions to a separate savings plan up to 8 percent of wages.

Seeking to shed its legacy costs, GE made barring new hires from the defined benefits pension plan a top priority and refused to budge on this issue.

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7 thoughts on “GE, unions reach tentative agreement

  1. Re the move to 401(k)’s for new hires. This is becoming a seemingly inexorable steamroller, shredding what’s left of job-related retirement security. It bodes ill for any of us trying to maintain a traditional pension system. I am unpleasantly surprised that the UE, an independent union with a militant, left-leaning tradition, would agree to this.

    • CBC stands for coordinated bargaining committee. It’s composed of representatives from the unions that have contracts with GE. UE and IUE are the main unions, but the steelworkers, IBEW, and serveal other unions also have contracts with GE.

  2. Yeah, this seems like such a poke in the eye, Looks like the Miners have done the same for new hires as well.

    What I gather is that the UE is facing significant challenges to its largest local (Local 506, Erie,PA locomotives, a couple thosand member local) by GE. GE just opened up a new non-union facility in Dallas. GE knocked labor costs by citing CAT lower labor costs…..CAT workers are represented by the UAW and have a much inferior contract.

    The UE stated that “given the current economic climate overall it’s an agreement we can support”. Meaning they and the other unions were in no position to wage an effective strike over the issues.

    Interesting how Local 201 IUE/CWA (large Lynn,MA works) hase urged rejection. Although Lynn went Immitation UE (IUE) back in the 1950s, they did so by a slim margin. They seem to have retained many of the older more membership friendly policies from their old UE days.

  3. “IUE-CWA and UE members voted to ratify 2011-2015 national agreements with General Electric.
    IUE-CWA members voted 70 percent to 30 percent to ratify a new four-year national agreement.

    UE locals in Erie, Pa., and Fort Edward, N.Y., also voted to ratify, but the percentages have not been reported. ”

    http://www.geworkersunited.org/index.cfm?action=article&articleID=60dd56e1-cfd7-4e5a-89f2-2a4c3ee512b7

    IUE Local 201 rejected the contract by 68%: http://local201iuecwa.org/category/newsletter/iue-cwa-local-201

  4. I think statement by UE’s officers tells it all:

    “Nevertheless, it remained obvious that we faced a company which had set itself in concrete with respect to its main objectives. And while UE members were reaching full-blast volume in their workplace actions, a similar growing trajectory of momentum occurred at only a handful of CBC locals. While GE did give ground on a number of issues in the face of the spirited fightback mounted by UE locals and certain other CBC locations, the difficult economic climate, as well the uneven organizational state of the CBC unions, convinced us that the prolonged, unified strike that would be necessary to move GE further on the key issues of medical insurance and new hires’ pensions was unlikely to be carried out successfully.”

    Not enough unity by CBC unions. Strike to end in no major gains. Put on a good face, put tail between legs and retreat as orderly as possible, That’s how it reads to me.

  5. I’m confused. What’s “CBC”? Anyway, the whole thing is so depressing. As you say, the Miners also capitulated on the pension issue. LLR wrote about this.

    Is the strike weapon dead? We’re in trouble.

  6. Thanks for the explanation, Will. (I don’t know how it got in the order it’s in, but . . . whatever.)

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