Shareholders told 47,000 seek jobs of UAW strikers

DIGGING IN AT CATERPILLAR

April 09, 1992|By Kim Clark | Kim Clark,Staff Writer The Chicago Tribune contributed to this article.

WILMINTON, DEL. — WILMINGTON, Del. -- In an ornate ballroom in the posh Hotel duPont, Caterpillar Inc. Chairman Donald V. Fites said yesterday that his company had gotten calls from 47,000 people interested in filling the 12,600 jobs being struck by the United Auto Workers. Outside the hotel, about 100 striking and laid-off workers carried signs demanding: "Permanently replace Fites."

What is likely to be one of the most important labor battles of the coming decade moved from Caterpillar headquarters in Peoria, Ill., to this normally quiet bastion of American capitalism yesterday as Caterpillar held its annual shareholders meeting.

Although annual meetings are often dull, self-congratulatory affairs, this one threatened to disintegrate into a shouting match, as union members who owned stock were denied a chance to address for more than two minutes the approximately 200 shareholders gathered in the chandeliered room.

Indeed, by the end of the day, it became clear the two sides were still far apart from a resolution, as each side blamed the other one for the worsening 5-month-old strike.

"There is nothing on the table that couldn't be negotiated by two rational people," said Eli Lustgarten, a PaineWebber stock analyst who follows the company.

"There is a lack of rationality on both sides."

In Washington, 15 senators urged Labor Secretary Lynn Martin to try to persuade Caterpillar to drop its plans to replace 12,600 striking workers permanently and instead to place the dispute under federal mediation.

In their letter, the senators wrote, "Surely the experience at Eastern Airlines, Greyhound, the New York Daily News, and countless other, less publicized disputes, has shown that the introduction of permanent replacements is counterproductive."

But at a news conference after the stockholders meeting, Mr. Fites said of Ms. Martin's proposed involvement, "At this stage we don't think that would be the appropriate thing." Ms. Martin's office said late yesterday that she had no immediate plans to intervene.

The UAW doesn't want to give in because it is afraid that allowing Caterpillar to win concessions not already awarded to its U.S. competitors would spark a round of concessions, explained Frank Prezelski, who follows the industry for Rothschild Inc. in New York.

Next year, he noted, the UAW is scheduled to negotiate a new three-year agreement with General Motors Corp., the largest employer of UAW members. "That's the real ballgame," Mr. Prezelski said.

It was clear emotions were running high when one striking worker who owned stock told Mr. Fites he was ruining the company by trying to replace veteran workers like himself.

Mr. Fites said he didn't want to replace longtime employees, and said the company is offering those who cross the picket lines jobs that will pay about $47,000 a year plus benefits.

At that point, Bill Casstevens, secretary-treasurer of the UAW and owner of about 100 shares of Caterpillar stock, shouted, "This is an annual meeting, not a scab solicitation meeting."

Indeed, much about this meeting was unusual: from the uniformed guards lining the walls to company managers' concessions that last year's financial performance by the world's largest maker of earthmoving equipment was "unacceptable." Caterpillar lost $404 million in 1991.

Although the company probably is still operating in the red, managers said the loss had nothing to do with the strike. Sales of almost every kind of earthmoving equipment were down significantly last year.

"We don't have a supply problem," Mr. Fites said, even though 4,000 salaried workers are running plants usually staffed by nearly 13,000 machinists and laborers. "We have a demand problem."

Mr. Lustgarten, the stock analyst, agreed that the strike hasn't contributed to the company's losses. He estimates the company is losing $33 million a month because of the recession. "If you are ever going to have a labor dispute, this is the time," he said.

The UAW has been picketing Caterpillar plants since Nov. 4 because the company has refused to sign a contract similar to those signed by equipment makers such as Deere & Co.

Caterpillar doesn't compete against Deere as much as it does against companies such as Komatsu, a Japanese tractor company, Mr. Fites said.

"If we allow our costs to rise unchecked, we won't be competitive and we'll lose," warned Vice Chairman James Wogsland.

But Mr. Casstevens, the UAW's chief negotiator for the Caterpillar dispute, dismissed Mr. Fites' arguments, saying that the company is simply trying to bust the union.

Mr. Casstevens has warned that Caterpillar's fight against the union may ruin the company, just as similar labor disputes, he argued, destroyed companies such Eastern Airlines and Continental Airlines. The union welcomes federal mediation, Mr. Casstevens said. Mr. Fites said the time for mediation is over.

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