• Air Line Pilots Association, representing more than 12,000 pilots with United Airlines and Continental Airlines, reached an “agreement-in-principle” on major scope and economic issues regarding wages and outsourcing as the parties negotiated a joint collective bargaining agreement after the airlines merged nearly two years ago.
  • Members of the International Brotherhood of Electrical Workers (“IBEW”) Local 1245 ratified a three-year contract with Pacific Gas and Electric Co. The contract streamlines the medical plan for 8,500 employees in central and northern California, locks-in health care costs for the next nine years, creates economic incentives for employees to use preventive care and manage their health better, increases wages by 2.75 percent annually, and introduces a cash balance pension plan for new hires instead of the defined benefit pension plan for current employees. The contract also creates a joint union-management safety committee to address safety discipline matters.
  • Members of United Steelworkers Local 5668 rejected a contract offer from Constellium Rolled Products, which included an average net gain of more than $15,000 per employee over the proposed contract’s five-year term. The offer included wage adjustments, annual pay increases, and a $4,000 ratification bonus totaling an average of $26,000 per person, as well as an increase in life insurance amounts, sick and accident benefits, company contributions for employees’ pensions, and an allowance for safety shoes. The principal employee concession would have been a new healthcare plan requiring hourly employees to begin contributing to premiums in 2014 to control the company’s healthcare costs that are already well above the national average.
  • Members of the CWA ratified separate three-year collective bargaining agreements covering over 13,000 workers at AT&T Midwest and around 5,5000 employees at AT&T Legacy. Over the term of those agreements wages will increase 8 percent and the defined benefit pension multiplier will increase 3 percent. Under the new contracts, employees will pay more for health care insurance costs. The union and AT&T also reached a tentative three-year agreement covering 22,000 workers in AT&T’s Southeastern Region. Under the tentative contract, workers will receive annual wage increases and “modest” pension increases.
  • Mechanics and workers in related work groups represented by the Transport Workers Union (“TWU”) ratified a new contract with bankrupt American Airlines by a narrow vote of 50.25 percent to 49.75 percent. According to the airline, the agreement will save nearly 1,900 jobs and offers pay increases to covered employees. The union represents approximately 24,000 American Airlines employees in seven work-groups, all of which have now ratified agreements with the airline.
  • SEIU Local 1 represented janitors voted to ratify a four-year collective bargaining agreement with six cleaning contractor companies. The agreement covers 3,400 workers who clean commercial office buildings in downtown Houston, Texas. The janitors end a month-long strike after reaching a tentative agreement in early August. The collective bargaining agreement increases wages 12 percent over the term of the contract. According to the union, more than 500 members participated in the ratification vote, which “appeared to be unanimous.” The union continues negotiations with a seventh contractor company.
  • Members of United Food and Commercial Workers (“UFCW”) Local 8 at Save Mart Supermarkets in California voted in favor of a new collective bargaining agreement, but members of Local 5 and 648 rejected the agreement. The contract will not be put in place until a majority of the voting members of the bargaining unit ratify the agreement. The bargaining unit consists of all three locals and covers 11,000 workers at 173 stores. Although specifics of the tentative agreement are unknown, the agreement included cuts in health care benefits for active members and elimination of health care for retirees.
  • Members of Utility Workers Union of America Local 1-2 ratified a four-year collective bargaining agreement with Consolidated Edison Co. of New York. Ninety-three percent of the members voted in favor of the contract, which protects existing defined benefit pensions for current employees to 2037, but establishes a new thrift savings pension plan for new hires’ retirement benefits. The agreement also includes an increase of employees’ wages by 10.5 percent over the contract term, two lump-sum payments totaling $1,800, an increase in employee health care costs, and provisions maintaining a wage progression program. The new contract also guarantees that the company will hire replacements for at least 75 percent of all employees who leave the company, rather than contract out the work.
  • Ending a four month strike, members of International Association of Machinists Local 851 at a Caterpillar facility in Joilet, Illinois ratified a six-year collective bargaining agreement. The agreement, which covers about 800 workers at the facility, includes wage freezes for most employees, increased employee contributions toward health insurance premiums, and freezes for employees’ pension plans in 2013. The terms finally accepted by the striking workers were nearly identical to Caterpillar’s final offer preceding the strike. Caterpillar continued to operate the plant with replacement workers and management throughout the strike.
  • ABF Freight System, Inc. announced that it will withdraw from the National Master Freight Agreement when that agreement expires on March 30, 2013. The carrier will seek to negotiate a new collective bargaining agreement with the union rather than continue to operate under the industry pact. ABF’s announcement follows the dismissal of an ABF lawsuit alleging its biggest competitor, YRC Worldwide Inc., and the Teamsters violated the National Master Freight Agreement by improperly negotiating three concessionary agreements in 2009 and 2010. ABF claims those concessionary agreements put it at an unfair cost disadvantage. After the dismissal, ABF was advised to shift its focus from legal battles to securing the best possible agreement with the union.
  • Analysis of collective bargaining data compiled by BNA for settlements through August 6, 2012 shows an average first-year wage increase of 1.7 percent, up from 1.4 percent in the comparable period of 2011. The median first-year increase for settlements reported to date in 2012 was 2 percent, up from 1 percent reported in 2011, and the weighted average was 2.3 percent, compared with 1.2 percent in 2011.
  • Major collective bargaining agreements reached in Canada during the second quarter of 2012 contained average wage increases of 2.1 percent according to analysis of collective bargaining data compiled by Human Resources and Skills Development Canada. The average wage increase was up from 1.7 percent in each of the previous two quarters. Additionally, private sector collective bargaining agreements in the second quarter of 2012 showed average wage increases of 2.1 percent, down from 2.7 percent in the first quarter, but on par with increases of 2.1 percent and 2.0 percent in the fourth quarter of 2011 and 2.0 percent in the third quarter of 2011.