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 health 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-degree heat outside the plant, which makes hydraulic parts and systems essential for much of the company’s earth-moving machinery.
Their profits are skyrocketing and their CEO pay is on the rise, yet the people out there making the products are being screwed. In other words, Caterpillar is a Republican Mecca of business.