Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, June 25, 1995 TAG: 9506300112
SECTION: BUSINESS PAGE: G-1 EDITION: METRO
SOURCE: CHRISTOPHER WILLS ASSOCIATED PRESS
DATELINE: PEORIA, ILL. LENGTH: Medium
A year later, Caterpillar quietly goes about its business and achieves record profits. The strikers, meanwhile, stand outside the factories and insist they will outlast the heavy equipment maker, no matter how good its record is without them.
Caterpillar made a record $955 million last year and set another record during the first quarter of 1995. It has increased the dividend paid to shareholders three times and plans to buy back some of its stock - essentially using the company's strong cash flow to invest in itself. (The company is the parent of Carter Machinery Co. Inc. of Salem.)
``I think they feel confident in terms of what they've accomplished, where the business cycle is and that their competitive position will remain strong,'' said Steven Colbert, an analyst for Prudential Securities Inc.
UAW members began walking off the job June 20, 1994, and the union declared a company-wide strike the next day.
Caterpillar has kept up production by hiring new employees, using temporaries and luring back many union members - about 4,100 of the 13,300 strikers, it says. White-collar workers also filled in, but the company says most are now back at their desks and drawing boards.
The UAW insists Caterpillar is producing machines that will fall apart under heavy use. But the machines are selling and producing few complaints.
``We talk to distributors all the time. I can tell you, none of the Cat dealers are even talking about the strike any more as an issue,'' said Frank Manfredi, publisher of the newsletter Machinery Outlook. ``There doesn't seem to be any interruption whatsoever in availability of product.''
The strike long ago settled into a stalemate that experts say can continue as long as the two sides want. The UAW staged a four-year strike against a gun manufacturer during the late 1980s, noted Illinois State University labor professor Victor Devinatz.
The UAW framed its strike as a protest against unfair practices by the company, making it illegal for Caterpillar to permanently replace the strikers. The union stemmed the tide of defections by tripling strike pay to $300 a week, or $15,600 annually, plus medical benefits.
``I'll tell you the honest-to-God truth. If things stay the way they are, it could go another year,'' said striker Dennis Dickinson, a Caterpillar employee for 25 years.
The dispute dates back to 1991, when the last contract expired. Caterpillar wanted changes such as lower wages for some new employees and managed health care for everyone. The union disagreed, insisting the contract follow the same pattern used at other heavy equipment makers.
The UAW launched a strike but ended it 163 days later, when Caterpillar threatened to replace the strikers. That tense period lasted until the latest strike began a year ago.
Union members say they walked out not over contract issues but because Caterpillar was harassing them and violating their right to organize. Indeed, the National Labor Relations Board has issued150 complaints against Caterpillar.
Strikers vow to outlast the company. But ask whether the walkout is hurting Caterpillar, and the strikers don't seem so confident. Some question the wisdom of launching a strike, although they say it has now become too important to lose.
by CNB