Caterpillar Pressing for Labor Concessions

[barbaro]

I think this is another example. Worker productivity and profits are up - but the company wants wages frozen (which means a decline actually) to remain competitive.

This, is the new norm (as we know).

And this is the strong and venerable.....Caterpillar

What your opinion?

At Caterpillar, Pressing Labor for Concessions
Daniel Acker for The New York Times


Members of the machinists’ union on strike in early July at the Caterpillar plant in Joliet, Ill.
By STEVEN GREENHOUSE
Published: July 22, <a class="inlineAdmedialink" href="#">2012</a>


JOLIET, Ill. — When it comes to dealing with labor unions, Caterpillar has long taken a stance as tough as the bulldozers and backhoes that have burnished its global reputation. Be it two-tier wage scales or higher worker contributions for <a class="inlineAdmedialink" href="#">health</a> insurance, the company has been a leader in devising new ways to cut labor costs, with other manufacturers often imitating its strategies.

Now, in what has become a test case in American labor relations, Caterpillar is trying to pioneer new territory, seeking steep concessions from its workers even when business is booming.

Despite earning a record $4.9 billion profit last year and projecting even better results for 2012, the company is insisting on a six-year wage freeze and a pension freeze for most of the 780 production workers at its factory here. Caterpillar says it needs to keep its labor costs down to ensure its future competitiveness.

The company’s stance has angered the workers, who went on strike 12 weeks ago. “Considering the offer they gave us, it’s a strike we had to have,” said Albert Williams, a 19-year Caterpillar employee, as he picketed in 99-<a class="inlineAdmedialink" href="#">degree</a>Solidarity.” The strikers often shout “scab” as replacement workers drive into the factory.

Ever since negotiations began in March, Caterpillar has insisted on a wage freeze for its top-tier workers, those employed seven years or more; they average $26 an hour, or $55,000 a year before overtime. For the junior third of the workers who typically earn $12 to $19 an hour, Caterpillar has made no promises but has suggested it might raise their wages based on local market conditions.

Caterpillar has offered workers several modest, one-time payments, but is also demanding far higher health care contributions from its workers, up to $1,900 a year more, according to the union. The company had profit of $39,000 per employee last year.

Carlos Revilla, the plant’s operations manager, defended the push for a pay freeze, saying the top-tier workers were paid 34 percent above market level.

“A competitive and fair wage package is a must,” he said in a statement. “Paying wages well above market levels makes Joliet uncompetitive.”

But the union says Caterpillar, the world’s largest producer of earth-moving equipment, is in no way uncompetitive and should be sharing its prosperity with its workers.

Link:
http://www.nytimes.com/2012/07/23/bu...ewanted=1&_r=1

[Panty Hamster]

Maybe they've compensated their workforce to a high level that management believes is due a respite for a few years -- while they recapitalize in a new factory or new equipment.

Oh that's right, I forgot, new factories and equipment are delivered randomly by fairies waving pixie-dust wands. Keep wages on the march, pensions, too. Pay these workers infinity! China will own you in 20 years.

[S Landreth]

Caterpillar

What your opinion?

Best piece of heavy equipment ever made.

[Fondles]

I thought CAT set up here in Thailand to counter the ever increasing wages in the western environment.

[S Landreth]

^Caterpillar: Thailand our Asean hub: Caterpillar: Thailand our Asean hub | Bangkok Post: business

Caterpillar will employ 2,000 people in Thailand once the two facilities are running at full capacity three years from now, Mr Lavin said during a visit to Bangkok yesterday.

The facilities will be Caterpillar's two largest plants in Asean.

"We chose Thailand as a production base in order to serve the Asean market as well as Central and Eastern Europe," said Mr Lavin.

[Panty Hamster]

I thought CAT set up here in Thailand to counter the ever increasing wages in the western environment.

And Bobo the wonder idiot wonders why all the jobs are disappearing.
Labor unions have no concept of equity. They are extortionists striking themselves out of a job. Not a lot different than British Air or Qantas airlines.

When their welding jobs go to China, I hope the glutenous fukkers choke on their own greed and their children eat the corpse as their inheritance.

They are mostly uneducated blue-collar workers earning a damn good wage. They want more. Fuck them.

[larvidchr]

What a load of rubbish from Caterpillar, they have together with other big business owners successfully turned the table on their own Countries and domestic workforces in pursuit of extra profit, they claim that domestic workforces now have to compete on salary relatively with a Chinese or a Vietnamese and their standard of living, all in the name of free competition on the world market.

Well I have news for you, the competition is not free, nor is it anywhere even, those countries manage to compete by inhumanly low salaries, paid to workers already living under horrible conditions, people living in countries where cost and standard of living is far below the west, they keep production costs down by not having safety standards, no pension schemes equal to no responsibility for their workers, no pollution standards and most importantly corrupt dictatorship mafia Governments unwilling to enforce any such rules.

It is no kind of progress to applaud, we could all do that easy, it is not an achievement to win by cheating on the weight.

But we will never be able to compete with that and neither should we, instead our Governments should demand equal production standards and labour protection, comparable to the home-grown one for all products imported, and impose punishing import tariffs, so costs of production is evened out with domestic production cost's for all products from places that don't comply with a minimum set of human rights, production standards, safety regulations, labour laws and environmental laws.

This would effectively take away the incentive for home-grown company's backstabbing their own country's who helped them to their success, from moving production abroad. And hopefully along the way help improve conditions for 3 world poor people.

Unfortunately the bought lobby financed US Government is unwilling and incapable of acting, and the now catastrophically failed economic ideology model they have promoted, and spread to many Western nations with equal stupid bought brown-nosing Politicians, is going to be our imperial downfall, back-stabbed by our own by leaving us to play by the rules of the solely profit oriented world of finance.
These people from big business and finance are without any Country affiliation no matter how much they lie about it and shamelessly beat the patriotic drum.

Our toothless Governments and Politicians with glue on their pants think only to the next election, "fvuck human rights if I can score a contract from China and buy some oil in Saudi getting some popularity votes"
The long-sighted global view and burning idealistic big ambitious political plans for spreading freedom and security, protecting the innocent and aiding the sick, hungry and weak, wherever on earth they might be, and standing tall for what is right even if it might cost you dearly etc., has long gone down the sewer drain, exchanged for healthy private bank accounts, 4 year re-election plans, and cosy non strenuous jobs in fancy offices with huge retirement settlements.

When it is time for bailouts of big business and financiers failed scams for profit, the innocent working people and tax payers, is forced to pay by the financiers bought chums the Politicians, pay for both their failures and their exorbitant bonuses supposedly for work well done, and that is without asking I might add, and then big business they have the fvucking audacity to cry wolf when the same workers would like to see a bit of the profits too when the going is good.

If a company makes a profit the idea is that some of that profit trickles down through the ranks, that is only just and fair and what's more good for the country as a whole.

In this period of economic crisis most working people have seen a loss in real wages via direct wage cuts, wage freezes etc. compared with inflation and cost of living, that would be normal too if your company is not doing to good, but if a company like Caterpillar makes a good profit they have no argument for not sharing some of that with their workforce.

There is no chance in hell that our advanced society, built up over generations by shared hard work and dedication, and with all the expensive trimmings in freedom, decency, rights, and equality an advanced society entails, I repeat no chance in hell will we be able to compete on prize with backward dictatorships pissing on intellectual property, human rights, the fate of their own poor people, and environmental damage.

And we should not even try, the whole point of us through hard work, wars, and blood sweat and tears, reaching a higher level with higher standards of living for all, and a much higher level of shared responsibility for our fellow citizens, was to protect and spread those standards for the good of all human kind, it was not to be conned and bow over and take it in the ass sponsored by egoistic businessmen and ice-cold financiers, all wanting Rolls Royce's and Yachts and their own holiday island's, no matter if the cost is our hard won way of life down the drain.

Rant over

[sabang]

Compensation for Cat's Oberhelman jumps 60%
April 11, 2012

The annual compensation of Caterpillar Inc.'s chairman and chief executive rose 60 percent in 2011, as the company posted a record revenue of $60.1 billion.

Douglas Oberhelman earned $16.9 million in 2011, a figure that includes salary, bonuses, stock and option awards and retirement plan contributions. Oberhelman pay increase, which was tied to the company's performance, included a $4.9 million cash payment, an 81 percent increase from his 2010 cash award. His base salary increased to $1.4 million from $1.1 million in 2010.

Caterpillar's board said in documents filed with the Securities and Exchange Commission that the compensation was warranted because he delivered superior results and grew the company's profitability.

Caterpillar generated $4.9 billion in profit, or $7.40 per share, on revenue of $60.1 billion last year. In 2010, Caterpillar generated $2.7 billion in profit, or $4.15 per share, on revenue of $42.6 billion.
Compensation for Cat's Oberhelman jumps 60% - Chicago Tribune

Nice to see the Caterpillar board are leading from the front in these times of austerity.

[sabang]

Lets have a closer look at dear Dougy, shall we. Well well, looky hear-

Oberhelman was on the board of Ameren until April 27, 2010. His wife, Diane Oberhelman, is chairwoman of Cullinan Properties Ltd. They hosted Laura Bush at their home for a political fundraiser for Republican congressman Aaron Schock in September 2010.
Douglas R. Oberhelman - Wikipedia, the free encyclopedia


An interesting interview with DougO, a native of Illinois, from the Chicago Tribune, March 16, 2012:-


As CEO of Peoria-based Caterpillar, Douglas Oberhelman is the most outspoken business leader in Illinois. On Friday, the company broke ground on a new plant in Athens, Ga., after a continent-wide competition for the facility. Oberhelman reveals in this interview that Illinois didn't even make the first cut and explains why he will not build any new factories here in the near future.

Q. But there are a few things I have to square that against. Caterpillar, for instance, takes taxpayer money to help pay for job training and new factories, and your overall effective tax rate from 2000 through 2009 was about 26 percent. (The top U.S. corporate income tax rate is 35 percent, meaning foreign subsidiaries helped shave Caterpillar's tax bill substantially.)

A. We end up filing a piece of paper waist-high every year (with the Internal Revenue Service), given all of the complexities in the tax code. We take full advantage of every deduction we possibly can, like I would encourage every single American to do.

Q. You have a whole department dedicated to lowering your taxes.

A. We have a whole department. We try to take advantage of every single deduction we can possibly find, which is in, my mind, an American way to do it. It's the law. We do nothing illegal. Everything we do is absolutely according to code. We're audited. I'm proud of our tax department.

Q. As you know, Illinois changed its tax code, so that large manufacturers, like Caterpillar, pay income taxes only on income from in-state sales. That was done to appease manufacturers. Your Illinois tax rate would skyrocket if Illinois simplified its tax code.

A. We have always had for a long time in Illinois a relatively attractive business tax rate. That was put in (in 1998) to make Illinois relatively tax friendly. What's happened is all these other things have gotten in the way of being friendly to business ...

Q. Wow. And you said they haven't screened Illinois for several years. These consultants haven't?

A. No, no consultant has, for any (new) site selection in the last three or four years for Caterpillar. When we've worked with other consultants in the past, Illinois didn't make it through the first cut.

Q. So the consultants initially screen all 50 states?

A. In the Georgia case, we also considered a couple of provinces in Canada and Mexico.

Q. What states were in the final six?

A. I don't remember.

Q. You were happy with the list they brought you?

A. The people in charge of that business sit with the consultants, go through the recommendations and do the due diligence. And then the consultants come back and recommend three. And then we get into a deeper set of investigation at the site. Our people go to the site. They'll go to the local college. They'll go to the economic development officials. They'll talk to the mayor, and really get into what do we have here. And then the discussion on incentives begins. Only then does the discussion on incentives from the state begin.

Q. Well if you're shipping to Asia, you could put a factory in Oregon. Or is that not cheap enough?

A. You can't chase wage rates. That's not going to work in a highly-skilled environment. We're not chasing wage rates at all in the United States. In our case, an investment like (the East Peoria plant we're in) has been 50 years. Just because wage rates go up and down, you can't base it on that. You have to base it on other things. And I would say that wage rates in the United States, with the way things are going today, are not all that greatly different (from state to state).

Q. OK. There was one other topic. Most of the high-tech engineering equipment on the floor of this factory was manufactured in Germany. Their economy is performing, yet they've preserved a social safety net.

A. I go back to bench-marking Germany. There are some big things to be learned in Germany. They value education. We spend a lot of money on education, but we don't value it. That's a big difference. Spending money and value are two different things. Somehow German society still values bettering themselves in STEM (science, technology, engineering and math). They're also great savers ... Society there is very different. There's little consumer debt. Charge cards aren't that popular. But education is the big one, and we've lost some of that.
Full Interview- Interview with Douglas Oberhelman, CEO of Caterpillar - Page 5 - Chicago Tribune


How interesting that the same CEO of Caterpillar who now wants to freeze US wages and pensions for six years says in this recent interview that "you can't chase wages in a high tech environment", and that "education is the big one". I had to put in the typical 'dutch auction' process for new Plant investment in the USA too, ie arriving at a shortlist (notably not including Cat's home state of Illinois, which he earlier said had "a deep educational base"),- "And then the discussion on incentives begins".

It is difficult to see why Doug, who values education and says you can't chase wages in a hi-tech environment, has had this apparent change of heart. Certainly, freshly awarded a 60% annual wage rise, he is not exactly chasing his own generous wage & employment package.

[OhOh]

Mr Douglas Oberhelman appears to admire the German business model of rewarding education, inclusive consultation with all levels of employees, fully funded pensions, health services. But is not able to pay the state taxes which pay for the education of US locals, he is not able to pay the taxes which pay for the infrastructure and he is not able to pay the taxes to fund medical services for the US locals.

When the US taxpayer stops paying for his overseas sales by cutting it's aid budget I wonder how many of his products will be purchased.

[Minnie Maugham]

Caterpillar is smart, IMO. I think many here forget history. Pls remember the 50s & 60s when the auto, steel & mfg industry unions demanded huge wage hikes, pensions and bennies when the firms in these industries were booming and they got their demands...look at those companies now. GM, Ford, Bethlehem Steel, Pittsburg Steel, various GE divisions. Pfft. Caterpillar is just being sane and I applaud them for keeping their biz going.

[The Big Fella]

To your Commie / Socialist union leader what the company is doing is showing it to be the fat cat capitalist pigs that they are. What caterpillar are doing is in fact ensuring, in this very financially unstable climate, the safety of their jobs and the safety of the factory. Very shrewd business management but will not be seen as anything other than greed.
Greed is only allowed when it is the unions demanding more money, less hours, more holidays or more healthcare. Then Socialist Communist greed is good.
Just look across the water to my home country. The unions there killed all major heavy industry. Coal, steel, car building, ship building all gone thanks to the unions. They are intent on doing the same with the public sector now.
Unions were once needed to protect the workforce. A while ago thy had no rights. Today they have hundreds of rights and a vast array of health and safety laws to protect them. Today the unions simply use the workers as political pawns and nothing more.
I have only ever been a member of a union once. I didn't wan't to join the union but it was in the days when they could make you. I will never join another. It did me no good rather the opposite and ended up, due to the continued strike actions over petty political points with the factory closing.
Thank you Mr militant union leader ! We all may have lost our livelihoods but we showed them though didn't we ?

[Panty Hamster]

Envy is a strong motivator.

Legions of gape-mouthed wrench-benders are convinced by union shucksters they're all more important than the CEO and should have some of that fat paycheck. All together now: "It's JUST NOT FAIR!"

[Minnie Maugham]

^^ Nice summary, Big Fella.

[sabang]

Whatever the reason, six years is far too long a period to freeze wages & pensions. Any major economic eventuality you care to name- stagflation, the great depression, OPEC crisis, the '98 GFC, '87 stock market crash etc, was not foreseen six years in advance or anywhere near. A Board that has just awarded it's CEO a 60% annual pay hike, and with Caterpillar earning record profits, even less so- it's quite absurd actually. If they want to hedge against inflation risk, go talk to an investment bank.

[robuzo]

Management takes the opportunity provided by an insecure labor market to squeeze employees unnecessarily after awarding themselves a wage hike. These are the job creators, eh?

[Bettyboo]

What caterpillar are doing is in fact ensuring, in this very financially unstable climate, the safety of their jobs and the safety of the factory.

By giving senior management massive pay increases and everyone else a pay freeze... Maybe folks would feel the sincerity more if the overlords also took a pay freeze...

[The Big Fella]

BB as I said you are proving my point about this being about greed and envy.
The guy that attaches the tracks to the machine is important. The guy that fits the engines also as important. The whole of the manual labour workforce do an excellent job but a job that you in most instances train anyone up to do. The top management have taken Catapillar and made it one of the most profitable companies today and considering the financial climate today the workforce should be thanking them. Many other companies are either closing or laying people off.
Would I be happy to sign a new contract that ensured me full employment for the next 6 years ? hell yes, as would most sensible people.
Union leaders simply play on the envy and greed of people. it is human nature but just because someone is earning more than you doesn't mean it is wrong.
I would love to know what the pay and pension the Catapillar union leader gets compared to the workers who pay his wages because in the UK the union leaders also award themselves huge salaries, expenses and pensions that the workers could only dream of !

[Lorenzo]

If they don't like it I'm sure they can grab another job of equal or better pay quite easily.

[Minnie Maugham]

Management takes the opportunity provided by an insecure labor market to squeeze employees unnecessarily after awarding themselves a wage hike. These are the job creators, eh?

Erm, these folks have a job, no? And good wages and they do get a pension. I guess they could go work for the govt and suck more outta the taxpayers while adding more to the coffers of SEIU.

This is just a union story. Take away the mgmt that turned the co. around, you got a crap co. that would likely fire most of the staff. As I said before, the big industry cos of the 60s & 70s caved to the unions when they made plenty...look at them now, stuck with $million/billion pension obligations that they cannot pay. Caterpillar sees that and refuses to follow the route to eventual ruin. Go complain about govt union and libbie politicians screwing their taxpayers.

[OhOh]

Take away the mgmt that turned the co. around

The co. mgmt turned the company around with the heavy assistance of the overseas workers as well as local US workers taking their own haircuts.

If the co mgmt can take a pay rise so should the workers.

Or are you suggesting that a person of capital is producing more than a salaried worker?

[Minnie Maugham]

are you suggesting that a person of capital is producing more than a salaried worker?

Yep. They manage the biz and these folks still have jobs. You want these mgmt folks to quit and put the firm in the hands of these workers or a stupid union? Sure, I remember the Horn of Plenty that became the Horn of Poverty.

[OhOh]

Whilst I agree that good management and direction is a prerequisite many companies enjoy, work with the "workers", share the rewards and obtain a long term profitable business.

[Minnie Maugham]

^ Disagree. The folks who make the biz profitable deserve their perks. I remember working at an inv bank in London. The Brit secretaries hated me coz I was "American" (erm, worse, from the colonies -- a Canadian) good-looking, well-dressed with an office and title. Meanwhile, they made 3-times what a sec at other companies made and got bonuses and pensions. Pfft. I worked 12 hours or more a day and made plenty. My big bosses made PLENTY more. Did I complain? No.
Pay the folks who make the biz work. Invest in future ops. Share all the earnings and what do you get? Temporary fizz before the possible fizzle. You never know what the next year is gonna bring.

[larvidchr]

We are not just talking perks here, it is ridiculous, unjustifiable on every level, and humongous overinflated salary's and stock options etc. etc.

You don't seem to get the point that this is a symbiosis, without workers no production so no profits and no products, it is not the management/owners alone that makes things work, one can not do without the other it goes both ways.

In the US where they have taken inequality in assessment of peoples value to the extreme crazy folly, by the impossibly colossal huge span between management paychecks and those who actually work for a living, and by awarding bonuses to same failed management losers, and incredibly with workers government tax contributions paying the needed bailouts and management perks, people is finally seeing the light and the complete rubbish of this state of affairs, things are going to change.

Management have for years preached shared responsibility and performance pay schemes to their workforces, but when it comes to profits and pay!, suddenly nothing is shared anymore, then Management magically becomes unique and of incalculable high value, and their almost unbearable burden of sole responsibility must be rewarded by covering them in gold, but then when they screw up that sole responsibility is suddenly forgotten, and taking the rap for having failed out of the question, and then to top it of they reward their own poor performance with a bonus, but God help a worker preforming poorly, he must take both responsibility and the rap and is booted out the door.

This kind of blatant crap, and to be honest poor outdated management style, is getting harder and harder to swallow and even in the brainwashed anti workforce organization US, people are starting to feel the pain in the backside from being royally screwed.

The Caterpillar guy so admiring Germany - Quote Douglas O - " I go back to bench-marking Germany. There are some big things to be learned in Germany."

Germany are the most productive and economically successful Country in the Western hemisphere and that is including the US, this Doughy guy seem to have missed that by law German company's must have union rep's on the board, which is one reason why German company's enjoy mostly content, loyal, and hard working employees, that actively participate in the company's development, that important detail seems to have bounced of his thick scull, since it probably is such an alien notion to the US style Neanderthal management culture in him, that he simply is incapable of taking it in.

Here it is, it is called Codetermination -

Codetermination in Germany is a concept with a solid history that involves the right of workers to participate in management of the companies they work for. Known as Mitbestimmung, the modern law on codetermination is found principally in the Mitbestimmungsgesetz of 1976. The law allows workers to elect representatives (usually trade union representatives) for almost half of the supervisory board of directors. The legislation is separate from the main German company law Act for public companies, the Aktiengesetz. It applies to public and private companies, so long as there are over 2000 employees. For companies with 500-2000 employees, one third of the supervisory board must be elected.

Codetermination in Germany - Wikipedia, the free encyclopedia