AKRON—Goodyear and union negotiators have signed a tentative six-year master contract that could end a three-week strike involving 12,300 rubber workers at nine locations. The two parties also inked a separate agreement that could end a walkout by 2,500—including up to 300 non-union workers—at the Fayetteville, N.C., plant of Goodyear's Kelly-Springfield Tire Co. division.
The North Carolina plant—Goodyear's largest unionized facility—is not covered by the master contract. United Steelworkers of America members in Fayetteville had worked day to day since their labor pact expired Sept. 8, but struck on April 22. Details on this labor package were unavailable at presstime.
Ratification votes for both agreements were to be held May 8. To be approved, the master contract must receive positive votes from a majority of the nine locals representing a majority of the members.
The first six-year master settlement in the tire industry (previous masters have been for three years), the May 3 pact includes modest wage and moderate benefit gains. The accord expires April 19, 2003, but has a reopen clause in April 2000, to discuss proposed changes in wages, medical and pension benefits and performance targets.
The package aligns contract expiration dates at Goodyear's three Kelly-Springfield factories. Labor pacts covering those units will expire July 6, 2003, just 75 days after the proposed master contract.
Highlights of the agreement include:
A cost-of-living adjustment (COLA) restoration of 29 cents per hour on Jan. 1, 1998;
A pay hike of 35 cents per hour on Jan. 1, 1999, for all employees at master locations;
COLA continues, without any ties to productivity;
An immediate $4 increase in the defined-benefit pension multiplier, to $41 per month per year of service;
A jump in health care coverage deductibles to $175 from $100 for individuals and to $350 from $300 for families;
A progressive wage scale for new hires, which starts them at 70-percent total wage compensation and brings them up to full pay within three years;
Provisions limiting outsourcing and short-term layoffs; and
Clauses calling for improved labor-management cooperation and employee training.
The settlement's six-year term—twice the length of the typical master contract—serves both the company and the union well, said Harry Millis, an analyst with Cleveland-based Fundamental Research Inc.
It gives Goodyear twice as long to bring its workers' hourly earnings—which average $18—in line with Bridgestone/Firestone Inc.'s approximate $17-an-hour wage package, Mr. Millis said.
``It's more time to eliminate the $1-an-hour differential,'' he said. ``It means they need to catch up just about 15 cents (an hour) each year rather than 35 cents. They can narrow the gap without hitting the workers too hard.''
Mr. Millis estimates that by 2000 Goodyear will have narrowed its hourly earnings gap with Bridgestone/Firestone by one-third, leaving it roughly 60 cents per hour behind.
The long-term labor pact allows Goodyear to hike its wage compensation about 3.5 percent and implement moderate benefit improvements while shrinking its pay differential with one of its fiercest competitors, he said.
The package assures Goodyear, its customers and employees six years of smooth sailing in an industry known for rough seas, Mr. Millis said.
``This means no lost market share, no real problems due to the strike,'' he said. ``It means six years of labor peace.''
If approved, the accord will help Goodyear increase its competitiveness and gain market share, which means more jobs and more job security, Mr. Millis said.
Both sides won a little and lost a little in this ``treaty full of tradeoffs,'' he added.
``It's obviously a contract Goodyear feels it can live with—otherwise they wouldn't have proposed it,'' he said. ``Now it's up to the rank-and-file.''
Contract ratification looks very favorable, said Mickey Williams, president of USWA Local 12 at Goodyear's Gadsden, Ala., plant.
``There are some things in the package that I'm not really fond of, but there are a lot of really good things in it too,'' Mr. Williams said. ``We made up a lot of ground from the proposal that was on the table when we struck.''
``From talking to other locals, I'm very optimistic about ratification,'' he said. ``I feel it will be voted in by a large margin.''
Meanwhile, negotiators with Michelin North America's Uniroyal Goodrich Tire Co. unit and the USWA have agreed to resume master contract talks on May 20 in Knoxville, Tenn., if the union ratifies the Goodyear package.
The two parties halted talks on May 5 until the negotiations were resolved at Goodyear, which the union selected as the pattern setter for this round.
Some 4,300 Steelworkers at Uniroyal Goodrich's three U.S. plants covered by the master—Fort Wayne, Ind., and Tuscaloosa and Opelika, Ala.—have been working day to day since their contract expired April 19.