Buffalo News (New York), October 27, 2005, Thursday

Copyright 2005 The Buffalo News
Buffalo News (New York)

October 27, 2005 Thursday
FINAL EDITION

SECTION: NEWS; Pg. A1

HEADLINE: Delphi proposals outrage workers;
Union leader calls leaked plan 'insulting'

BYLINE: By Fred O. Williams - NEWS BUSINESS REPORTER

BODY:
Details of Delphi Corp.'s deep cost-cutting proposals began leaking out Wednesday, outraging production workers at the Niagara County plant and, according to one United Auto Workers official, heightening the possibility of a strike.
"It's more insulting than the previous proposal," said Paul W. Siejak, president of United Auto Workers Local 686 Unit 1 in Lockport, with 3,000 members.
Delphi chief executive Robert S. Miller is "pushing us to the point where our only alternative is the nuclear option."
Asked to clarify his remark, Siejak said "I don't want to say the word 'strike.' "
The proposal was delivered to unions last week, when UAW national leaders dismissed it as an attempt to import Third World wages. The terms, harsher than ones Delphi sought before filing for bankruptcy on Oct. 8, drew a new round of responses after appearing on the Internet on Wednesday.
The proposal calls for base wages of $9.50-$10.50 an hour for most production workers, down from more than $25 an hour, and ends job guarantees. Skilled trades workers would earn $19 an hour, from about $30 now.
Instead of company-paid health care, workers would shoulder 25 percent of costs and be subject to a $1,800 deductible for family coverage.
A freeze in the pension plan would halt the accrual of benefits for current workers. But the proposal also says the company may end the pension plan. Health coverage for retirees would be eliminated, as Delphi had previously proposed.
In addition, the proposal ends cost-of-living adjustments, rolls back overtime to the legal minimum and cuts paid holidays.
As for job security, the proposal eliminates restrictions on use of contractors and on closing or selling plants. Such protections are usually considered untouchable by unions.
"Delphi recognizes the hardship this proposal imposes on your members. There is no alternative," the proposal states.
Beset by losses, Delphi has said it will seek bankruptcy court permission to break its current labor contracts if unions don't agree to a new deal by Dec. 16. At that point the auto components maker would ask the court for a hearing on the issue to be held in January. The proposal assumes the cuts would be in place Jan. 1.
Analysts said the company's proposal may be calculated to provoke the union, or to push General Motors to step in and avert a strike that would cripple its assembly plants. Delphi is GM's former parts unit, spun off in 1999.
"My feeling is they're trying to tell the union, 'go out on strike, we'll replace you,' " said Arthur Wheaton, a labor studies teacher at Cornell University's School of Industrial and Labor Relations in Buffalo. "I think there's no way on earth they're going to negotiate an agreement."
To the contrary, Delphi will listen to union counter proposals and engage in talks with the aim of reaching an agreement, spokesman Lindsey Williams said. The talks -- which include the International Union of Electronic Workers and Steelworkers in addition to the UAW -- could continue beyond the mid-December filing that would seek to break the current contract, until the bankruptcy judge acts on the filing, he said.
"The intent is not to have to file that motion," Williams said.
Delphi's proposal says that the previous offer it made before filing for bankruptcy on Oct. 8 was more generous because it assumed the possibility of help from GM. The earlier proposal offered wages of $10-$13 an hour.
The UAW unit in Lockport issued a memo Wednesday urging workers to continue building quality products but not to "go above and beyond" for managers.
"There's no morale," Siejak said. "We're urging people to keep working, keep building the best products for our customers . . . but people are so frustrated because of Mr. Miller."
Plant union leaders will meet with UAW national leadership in Detroit on Nov. 2, Siejak said. Response to the proposal will be up to the national union.
A total of 269 workers in Lockport accepted a $25,000 buyout offer in August. That should be enough to eliminate the site's overhang of surplus workers on Dec. 1, when many departures take effect, Siejak said. The plant complex currently has a "jobs bank" of 98 surplus workers.
However, Delphi expects the total of surplus production workers to climb by about 130 by year's end. Declining orders from major customer GM have slashed sales and contributed to operating losses.
e-mail: fwilliams@buffnews.com