South Milwaukee workers reject Caterpillar contract proposal

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The United Steelworkers (USW) today said that members of Local 1343 in South Milwaukee rejected a proposed six-year labor agreement with Caterpillar Inc. and that the union will resume negotiations with the company for a new contract.

The USW is instructing all members of Local 1343 to continue reporting for work at Caterpillar as scheduled.

The USW represents 850,000 men and women employed in metals, mining, pulp and paper, rubber, chemicals, glass, auto supply and the energy-producing industries, along with a growing number of workers in public sector and service occupations.

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The union represents about 800 workers at the South Milwaukee mining equipment manufacturing plant, which was part of Oak Creek-based Bucyrus International Inc. until the company was acquired by Peoria, Ill.-based Caterpillar in July 2011.

The company and the union have been negotiating since April 2 on the first USW contract under Caterpillar ownership.

According to the company’s negotiations website, the proposed six-year contract would have frozen wages, eliminated some seniority protections and increased the employees’ costs of health care.

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The company agreed to a $2,500 bonus per employee if the contract was ratified by April 30.
Citing declining demand, Caterpillar recently announced it will temporarily lay off 250 to 300 of its South Milwaukee employees by June.

Caterpillar reported a 17 percent dip in sales and profits declined 45 percent in the first quarter.

The company also plans to permanently lay off 460 supplemental employees from its plant in Decatur, Ill. And according to the Peoria Journal Star, the company announced last week that 60 workers will be indefinitely laid off in Mapleton, Ill.

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Caterpillar issued the following statement about the union’s vote: “During a vote held on Tuesday, April 30, Caterpillar employees represented by the United Steelworkers (USW) union in South Milwaukee, Wisconsin, voted against ratifying a new six-year agreement with the company. The outcome of today’s failed ratification vote is unfortunate. Our employees rejected what we believed to be a competitive contract offer. We will now assess the situation and determine what, if any, are the appropriate next steps in this process. In the meantime, we will focus on working safely, meeting production levels and conducting business as usual as we focus on meeting customer needs.”

BizTimes’ coverage of the contract dispute will be ongoing.

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