SALEM, Va. — Union workers at Yokohama Tire Corp.´s Salem manufacturing plant have ratified a new three-year agreement with the company that guarantees job security and reduces the tire maker´s costs.
About 80 percent of the voting members of United Steelworkers Local 1023 approved the new deal April 30, according to local President Mike Amos. The pact — which runs effective April 16 of this year to May 16, 2010 — is similar to the master agreements ratified earlier in the bargaining season by USW members working at Goodyear, Michelin North America Inc.´s BFGoodrich units and Bridgestone/Firestone.
The contract at BFS was ratified most recently, on April 25. The Goodyear pact was approved in December after an 86-day strike, and the BFG deal was voted on in August. All of the Big Three contracts expire in July 2009.
Highlights of the Yokohama agreement, according to a contract summary, include:
— plant protection for the life of the deal;
— continued capital spending in Salem to modernize machinery and improve the plant´s capabilities;
— maintenance of the cost-of-living allowance structure, plus a diversion of the first $1 to help fund retiree health care costs;
— reinstatement of 35 cents of past COLA diversion into the basic wage rate;
— $2 increase of the pension multiplier to $55 per month for every year of service;
— maintenance of deductibles, out-of-pocket costs and drug co-pays in the health care program for active members and retirees; and
— protection of wage rates for current employees.
Amos said the negotiations with the company were difficult because of the pattern set by the other tire makers. In the end, however, Local 1023 members felt they were able to improve upon the pattern and do some things "a little different"-agreeing to a two-tier wage structure vs. a five-tier, for example-in many areas to benefit the current workers, retirees and future hires, he said.
The Yokohama/USW contract broke pattern on selected issues for new hires as well, according to the summary. New hires will receive the same pension accrual, retiree, drug co-pay, sickness and accidental, and vision care benefits as current employees.
For Yokohama, the agreement helps the company control costs in the "very competitive" U.S. and global tire market, said Steve Kessing, the company´s vice president of administration. Manufacturing costs in Salem will be reduced through the implementation of the two-tier wage structure, health care contributions and benefit reductions for workers with less than three years of service.
Plus, the job security provisions will allow employees to focus on production and quality issues with the assurance that the facility will remain operational during the term of the contract, Kessing said.
The Salem facility employs about 900 people and manufactures primarily passenger and light truck radial tires. Fullerton, Calif.-based Yokohama Tire is the North American manufacturing and marketing arm of Tokyo-based Yokohama Rubber Co. Ltd.