News From USW: Labor Board Charges Continental Tire With Unlawfully Relocating Charlotte Production

PITTSBURGH--July 5, 2006--News From USW: The United Steelworkers (USW) received notification today from the National Labor Relations Board (NLRB) that complaints were issued against Continental North America (CTNA) for unlawfully relocating its Charlotte, North Carolina production. The NLRB charged the company with refusing to provide information requested by the USW during negotiations and that it also failed to examine all avenues to reach a settlement before unilaterally implementing its "last, best and final offer."

"It became increasingly obvious during negotiations that Conti didn't intend to bargain in earnest," said USW executive vice president Ron Hoover.

From the onset of talks this spring, Continental demanded that only an agreement, which provided $32 million in annual concessions, would be considered. Despite multiple requests for documentation, the company never did explain how it concluded that it needed that amount. Without these savings, Conti threatened to cease tire production in September 2006. In March, it laid off 114 workers and another 166 more in May. An additional 360 are scheduled for lay-off this week.

During negotiations, the USW submitted proposals that would have yielded $16 million in cost savings through wage and health benefit concessions, increased production and production efficiencies, and cost-controls on spiraling health care and prescription drug costs. Even though the parties were making progress in negotiations, the company short-circuited bargaining by wrongly claiming that talks had reached an impasse when the April 30 contract deadline arrived.

It then implemented its proposal that cut costs by $32 million annually. Included were drastic wage cuts and major increases in the cost of health care coverage for both active and retired members. Still, it was only eight days later that the company announced it would cease tire production in July 2006 and relocate it to other facilities. The hourly workforce would be reduced from nearly 1100 in July 2005 to less than 100, leaving intact mixing, warehouse and maintenance operations in order to avoid paying pension and insurance obligations as outlined in the contract's plant closure language.

"Our members do not view this as a victory," said USW Local 850 president Mark Cieslikowski. "A victory would be achieving a contract with long term job security. We see these charges as validation of our statements that the company presented us with an unjustified 'take it or leave it' proposal."

Under the NLRB's procedures, the Company has the right to request a trial of the evidence against it. NLRB remedies in the case could include: orders to reinstate employees laid off since March 2006, resume production operations and reimburse employees for lost wages and benefits.

Overall, the USW represents some 70,000 members in the tire, rubber and plastics industry and 850,000 in the U.S. and Canada.