After a merger with GE Transportation, the new employer “wants to turn this into an Amazon warehouse,” the union says.
Nearly 1,700 workers at a GE Transportation plant in Erie, Pennsylvania, went on strike Tuesday, marking the first large-scale work stoppage in the U.S. manufacturing sector in three years.
Union members with the United Electrical, Radio and Machine Workers of America (UE) say the factory’s incoming owner, Pennsylvania-based Wabtec Corp., is trying to impose mandatory overtime, a lower pay scale for new employees, and the use of temporary workers in the facility.
Wabtec just closed an $11 billion deal to merge with GE’s transportation division, which includes the Erie plant where locals have built locomotives for decades.
Workers authorized the union to wage a strike after they failed to secure an interim agreement with Wabtec extending the terms of their contract with GE. As the new employer at the plant, Wabtec is obligated to recognize the union but has the freedom to negotiate its own new contract.
Union members felt they needed to go on strike in order to protect the middle-class wages and high working standards inside the facility, where pay averages around $35 an hour, said Jonathan Kissam, a union spokesman. He added that many workers already volunteer for overtime work but don’t want it to be mandatory, fearing it could ruin weekends with their families.
He also said introducing lower pay for new hires would create a two-tier system inside the plant, causing rifts between different generations of employees.
“This is a multi-generational plant. Some of them, their grandparents worked there,” Kissam said. “So they’re unwilling to sell out their own children.”
He added, “Wabtec wants to turn this into an Amazon warehouse.”
Wabtec proposed maintaining the same payscales for current employees, while new hires would come in at a “competitive wage” for the industry, said Deia Campanelli, a Wabtec spokeswoman. She said the company wanted the flexibility to require overtime “only when necessary” to hit production goals.
Campanelli described the company’s offer as on par with the terms at a separate Wabtec facility in Pennsylvania that’s also unionized by UE.
“We are disappointed in their decision,” she said. “These are great-paying jobs for that community, for that region.”
Unions are leery of two-tier systems for good reason. As older workers under the established pay scales change jobs or retire, the share of employees under the lower payscales grows. The differing rates can sow friction within the union, as newer workers know they’ll never make the same money as their veteran counterparts. A controversial two-tier proposal became the primary sticking point in the Teamsters’ recent negotiations with UPS for a contract covering 260,000 workers.
Under Wabtec’s proposal, new hires would make around 38 percent less than current workers, according to Kissam.
Companies often say they need to institute two-tier systems in order to stay competitive. In an op-ed on the Erie strike, Greg Sbrocco, a Wabtec senior vice president, argued that global pressures necessitated it, calling the lower rates for new hires ”a standard practice by U.S. manufacturing companies to aggressively compete with competitors in low-cost countries like China or Mexico.”
Many workers were initially hopeful the takeover by Wabtec would be a good thing, said Scott Slawson, the president of UE Local 506 who’s worked as a welder at the plant. There had been plenty of anger in recent years under the ownership of GE’s transportation division, which opened a new facility in Texas, a right-to-work state with lower pay, and sent hundreds of Erie jobs there.
But Slawson said much of that optimism faded when the union couldn’t secure a new contract with Wabtec or a temporary agreement extending the terms of the old GE one.
“We feel the terms and conditions they put forth on our members were unacceptable,” Slawson said, adding that an overwhelming majority of members voted to approve the strike. “We felt it was best just to stand the picket line.”
Sen. Bernie Sanders, the Vermont independent who is again running for president in 2020, on Tuesday urged Wabtec to honor the terms of the GE contract. He said he was “proud to stand” with UE members in their “fight against the Wabtec corporation to maintain decent wages and working conditions.”
The number of worker strikes in the United States has shot up in the past year, most notably among teachers, who have led walkouts in states around the country. The improved economy has also given many workers in the private sector more bargaining power, as unemployment stays low and qualified workers are harder to come by.
The last large work stoppage in manufacturing was a lockout of United Steelworkers members at Allegheny Technologies, according to data from the Bureau of Labor Statistics.
The last time workers at the Erie GE plant went on strike was in 1969, when they were off the job for more than three months. Kissam said as of Tuesday afternoon there were no negotiations scheduled with Wabtec, suggesting a resolution wasn’t imminent.