Cooper, USW contracts in arbitration (update)

By Bruce Davis, Tire Business staff

FINDLAY, Ohio (Aug. 31, 2013) — The status of Cooper Tire & Rubber Co.'s contracts with unionized workers at its Texarkana, Ark., and Findlay plants is in the hands of an arbitrator, who is tasked with determining whether Cooper's planned sale to India's Apollo Tyres Ltd. violates successorship provisions of the union's contracts with Cooper.

The arbitration hearing took place Aug. 28 according to information in the proxy statement Cooper filed ahead of a planned Sept. 30 special shareholders' meeting to vote on the proposed sale to Apollo

The hearing took place in Washington, directed by James Oldham, a law professor at Georgetown University, according to the United Steelworkers (USW) Local 207L, which represents Cooper workers in Findlay.

Mr. Oldham, who previously was "permanent arbitrator" for the Texarkana plant, is expected to issue a judgment within the coming 14 days, according to Rodney Nelson, president of Local 207L.

The USW — which represents rank-and-file workers at the Texarkana and Findlay plants — filed a grievance on Aug. 1 alleging that Cooper had violated the successorship provisions of the collective bargaining agreement applicable to each plant by entering into the merger agreement with the Apollo parties tasked with effecting the buyout, according to the proxy.

The union believes that the negotiations should take place before Apollo acquires Cooper, so that USW-represented employees will have assurances in writing to provide for adequate job security, as well as pension and insurance financial protections in the event Apollo takes over, Mr. Nelson said.

Cooper Tire has stated publicly in connection with the merger that the current collective bargaining agreements would continue after the merger. Cooper and the USW subsequently agreed to binding arbitration regarding this dispute, Cooper said.

The union is being represented by its attorneys from New York, the USW Legal Department and the USW's financial advisers, Mr. Nelson said.

Should the USW and the local unions prevail in the arbitration, Cooper or the Apollo parties "could be required to enter into an agreement with the [USW] and each local union establishing different terms and conditions of employment from those in the current agreements" to be effective at Findlay and Texarkana, Cooper said in the proxy statement.

Local 207L workers at Findlay approved a five-year contract with the tire maker in February 2012, and Local 752L workers in Texarkana approved their own four-year deal in January 2012.

Cooper's other U.S. plant, in Tupeolo, Miss., is a non-union facility.

Cooper also said workers at its Cooper Chengshan Tire joint venture plant in Rongcheng, China, are back at work after a two separate strikes lasting six weeks, albeit on a "limited basis to manufacture only non-Cooper-branded products…."

The workers, who went on strike to protest the planned sale of Cooper to Apollo, also have taken "other disruptive actions," Cooper said, including denying access to certain Cooper representatives and withholding certain business and financial information.

"We continue to work toward resolving these issues," Cooper said.