AFX - Asia, May 13, 2007, Sunday

Copyright 2007 AFX News Limited

AFX - Asia

May 13, 2007 Sunday 10:14 PM GMT

HEADLINE: GE-union contract talks begin next week

BODY:

HARTFORD, Conn. (AP) - Job security, rising health care costs and pensions will be among the key issues in contract talks beginning next week between General Electric Co. and labor unions that represent 23,000 workers.

Fairfield-based GE, the sprawling conglomerate that makes aircraft engines, locomotives, medical imaging equipment and other products, recorded revenues last year of $164 billion but has been working to shed slow-growth businesses and further expand into overseas markets to improve its profitability.

GE's negotiations are seen a possible bellwether for manufacturers across the nation, as companies and unions watch to see how the company handles chronic issues of pensions and rising health care costs.

'This is definitely one of the bigger negotiations,' said Richard Hurd, a labor studies professor at Cornell's School of Industrial and Labor Relations.

National negotiations are expected to begin May 21 in New York with the Electronic, Electrical, Salaried, Machine and Furniture Workers-Communications Workers of America, which represents about 10,000 workers, and the United Electrical, Radio and Machine Workers of America, with 4,000 members.

GE also will negotiate local contracts with the Machinists union, International Brotherhood of Electrical Workers, auto workers, steel workers and other unions.

'Going forward, we anticipate one of the big fights on the table will be that new hires will not have a pension,' said Lauren Asplen, spokeswoman for the Coordinated Bargaining Committee of GE Unions. 'We're also seeing a building crescendo on health care.'

GE spokesman Gary Sheffer would not discuss specific bargaining issues but said wages also are expected to be a topic.

'GE does not negotiate in the media and there is always a lot of rhetoric at this early stage of the negotiating process,' he said. 'We provide good jobs and good benefits, we provide our employees with a very attractive package of wages and benefits that compare favorably with our competitors, and while keeping GE's business competitive.'

Despite GE's size and profitability, workers are jittery about their jobs, Asplen said.

During the current contract, which expires June 17, GE closed or announced the closing of three small motor plants, Asplen said.

Sheffer said that in the 'vast majority' of closings, most of those who were eased out of their jobs retired or were helped by GE to speed up retirement to avoid layoffs.

GE's overseas sales this year are expected to roughly match its domestic business for the first time due to rapid global growth.

The company has a fast-rising presence in developing area such as India, China, eastern Europe, Africa and the Middle East. The company posted $10 billion in emerging market revenue in 2000, which rose to $29 billion this year and is expected to be $50 billion in three years. At the same time, it's been selling off slower-growth businesses such as insurance and plastics, focusing on faster-growth areas such as energy, oil and gas equipment, rail engines, health care technology, finance, and water processing technology.

Ric Casilli, a business agent for Local 201 of IUE-CWA at GE's aircraft engine plant in Lynn, Mass., said GE has signaled it will try to shift health care costs and cut early retirement eligibility for some employees.

'We feel we're on the defense on these issues,' he said.

Since GE signed its first union contract in 1938, employees struck four times, including a two-day walkout over health care costs in 2003 several months before negotiations began for the current contract.

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