The Courier-Journal (Louisville, Kentucky), September 3, 2005, Saturday

Copyright 2005 The Courier-Journal (Louisville, KY)
All Rights Reserved
The Courier-Journal (Louisville, Kentucky)

September 3, 2005 Saturday Metro Edition

SECTION: BUSINESS; Pg. 1D

HEADLINE: New hires at GE may get lower pay;
Union deal includes retirement offers

BYLINE: SCHOENBERGER ROBERT, rschoenberger@courier-journal.com

BODY:
Byline: Robert Schoenberger
Source: The Courier-Journal
General Electric and the IUE-CWA Local 761 have proposed a lower wage for new hires at Appliance Park in Louisville and elimination of an automatic raise after three years.
If workers approve the agreement, GE has promised to offer early retirement to 200 of its more senior employees by mid-2007. The company also has agreed to hire as many as 500 workers both to replace retirees and to boost production.
The contract would start workers at almost $27,000 per year - $12.88 per hour and $1 per hour less than the current contract. The bigger change would come three years later when they won't get raises to $41,000 per year.
The new hires could be making as much as $30,000 after three years of regular raises and cost-of-living increases tied to the Consumer Price Index.
Tommy Spires , president of Local 761, said the contract would make Appliance Park more competitive, a necessity for an industry dealing with low-cost imports from Asia, rising prices for components and falling prices for finished goods.
"I've been here a long time, so I'm looking at this as a decrease in pay," Spires said. "But if I'm one of the people out there looking for a job or making $6 an hour, this is a good wage with good benefits."
The new hires still would be eligible for health, dental and retirement benefits, GE spokeswoman Kim Freeman said.
Some employees at Appliance Park said they were not happy with paying new workers less, but considering that the plant has fallen to about 3,000 manufacturing employees after peaking at 23,000 in 1973, a change in wages was better than watching more jobs go away.
Natisha Daniels-Thompson , a 12-year employee who paints dishwasher panels, said the proposal "has its good points. Bringing more jobs here would be good."
She said she planned to study the proposal over the weekend to prepare for a union meeting Sept. 11 to discuss the issue.
Steve Troutman , a dishwasher builder who has been at Appliance Park for 32 years, said workers with more seniority likely will back the plan because of the early retirement slots.
The 100 retirement slots to be offered in 2006 and 100 more to be offered in 2007 "are going to be really popular. A lot of people want to get out."
Wage structures that guarantee that new workers will never earn as much as senior employees used to face stiff opposition from unions, said Lance Compa , a labor law professor at Cornell University in Ithaca, N.Y.
But that resistance has lessened over the years as companies have moved jobs overseas.
"If the long-term trend is to reduce the force (at Appliance Park), it could be a practical matter for the union," Compa said. He later added, "If the feeling is there's not going to be opportunities for jobs without a tiered system, it's easier to approve."
GE CEO Jeff Immelt told students in Michigan this week that eventually manufacturing jobs like those at Appliance Park would be shifted to China and Mexico, the Detroit Free Press reported. But Immelt later said through a spokesman that he was referring to the general state of the industry and that the company is committed to Louisville for the long term.
The amount GE saves on the new wage structure will depend on the wages earned by people who take early retirement.
By not giving a major raise after three years, GE would save about $5.5million on the 500 people Freeman said the company would hire.

GRAPHIC: Daniels-Thompson