workers at the former appliance division of general electric co. rejected a new contract this week, spurning an attempt by its new chinese owners to cut costs at a massive factory complex in louisville, ky. members of the union representing ge appliances factory workers in louisville voted down the four-year deal on tuesday, against the recommendation of union leadership. the agreement would have lowered wages for new hires at the appliance park complex, cut overtime and triggered buyouts for up to 450 workers. the deal<u+2019>s failure comes just months after ge appliances was purchased for $5.6 billion by china<u+2019>s haier group, which was seeking a larger american foothold for its appliance business as ge sought to exit from the business. haier group, which also imports appliances such as air conditioners from china, will continue to use the ge appliances name for 40 years. the rejection comes on the heels of donald trump <u+2019>s surprise election as president. on the campaign, mr. trump denounced corporate outsourcing and pledged to save american manufacturing jobs. he also called for punitive tariffs on chinese goods . haier<u+2019>s existing u.s. factories and brand will be formally combined with ge appliances at the beginning of 2017. ge appliances is shrinking its footprint elsewhere. in august, the company closed a refrigerator plant in bloomington, ind. in an emailed statement, a ge appliances spokeswoman said the company was <u+201c>extremely disappointed<u+201d> in the rejection of the contract, which followed 14 weeks of negotiations between management and the union. <u+201c>a workforce that is unwilling to change to improve our operations and cost position could deter future investments in appliance park,<u+201d> the company statement said. <u+201c>while it is our desire to continue to manufacture at the park, we cannot do it to the detriment of our customers and the overall business.<u+201d> ge appliances says it loses hundreds of millions of dollars annually at the appliance park complex, and has to restructure its worker compensation to keep costs of its products in line with competitors. in lieu of wage increases, the deal would have given workers $5,500 in three cash payments through 2019 and restructured the company<u+2019>s contribution to 401(k) plans to more quickly match worker contributions, according to a summary of the agreement reviewed by the wall street journal. <u+201c>it was a tough contract to try to get passed through the membership,<u+201d> said dana crittendon, head of the local union, which represents 4,000 of the 6,000 workers at appliance park. hourly workers were upset the deal included no raises for existing staff and were angry at the plans to bring in new hires at even lower pay, he said. <u+201c>they felt that it was a disgrace to bring another tier in at $12 an hour, when here in louisville on every street corner there<u+2019>s a sign for temporary jobs paying $14 or $15 an hour,<u+201d> mr. crittendon said. mr. crittendon said he will meet with ge appliances executives wednesday evening in an effort to bring management back to the bargaining table. the goal, he said, is to <u+201c>keep the company competitive in a tough market<u+2014>and also keep the jobs here in louisville.<u+201d> a former union official in louisville said mr. trump hadn<u+2019>t been a factor in this week<u+2019>s vote, though he suggested the president-elect could be influential in future contract talks. the official also declined to blame the company<u+2019>s new owners for the rejection of the deal; most of the management team who negotiated the agreement had led the company when it was part of ge, he said. <u+201c>this is them<u+2014>this isn<u+2019>t haier,<u+201d> the official said. workers rejected the deal because it would have eliminated the chance of a pay increase until the contract expired in 2020, at a time when workers have to cope with high health-care deductibles, the official said. by the end of the deal, he said, <u+201c>how<u+2019>s anybody going to have any money left?<u+201d> ge appliances said it would await a union request to resume discussions on a new contract. write to ted mann at ted.mann@wsj.com
ge appliance workers reject contract offer from chinese owner  - wsj
ted mann