LABOR CONTRACTS Experts: Power shift fuels Caterpillar-UAW standoff

Union leaders at Caterpillar are wary of calling a strike.
PEORIA, Ill. (AP) -- During more than a half-century of bargaining, heavy-equipment maker Caterpillar Inc. and the United Auto Workers have forged only two labor contracts without a strike.
But there's been only a fleeting whiff of a walkout this year, as more than 9,000 UAW members have stayed on the job without a contract even after turning down two take-it-or-leave-it offers over the last nine months.
Labor experts say the standoff signals a shift in bargaining power that has given Peoria-based Caterpillar the upper hand and left union leaders wary of playing their traditional trump card.
"The fact talks have gone on this long is vivid evidence that union leaders understand their weakened position. Twenty-five years ago, the union would have gone on strike immediately," said Peter Feuille, head of the University of Illinois' Institute for Industrial and Labor Relations.
Will go back to table
The two sides have agreed to return to the bargaining table, though no date has been set. Caterpillar has said it will only clarify, not modify, its last failed offer, while union leaders think the company may find some wiggle room once talks resume.
Nationally, union bargaining power has slowly eroded over the last quarter-century as its membership waned and the 1981 firing of federal air traffic controllers emboldened companies to counter strikes with replacement workers, according to labor experts.
They say Caterpillar has taken a more aggressive approach than most major companies after flexing its newfound bargaining muscle during a bitter, 61/2-year stalemate in the 1990s, when the company foiled two strikes by using patchwork crews to maintain production and profits.
Labor experts likened the negotiations to a poker game, saying the power shift has dealt Caterpillar twice as many cards as the union while both sides try to win a new contract.
Unlike the Big Three automakers, they say, only 12 percent of Caterpillar's nearly 74,000 workers worldwide are UAW members -- down from about half in the late 1970s -- making it easier to cobble together crews and keep production rolling during a strike.
Using strategy
Plus, they say the company proved the strategy works during its standoff with the UAW in the '90s, when up to 30 percent of workers crossed picket lines and the union ultimately accepted a contract that was essentially the same as the one that sparked the impasse.
"Any other company that felt they defeated the union and could get more concessions would be acting the same way," said Victor Devinatz, an Illinois State University professor who specializes in labor relations.
The union has agreed to two-tiered wages, but says Caterpillar's proposal is too low. The scale for current employees starts at $20 to $22 an hour. Under Caterpillar's proposal, new hires would start at $10 to nearly $16 an hour, depending on their job classification.
Caterpillar says nearly 80 percent of U.S. workers contribute to health-care coverage because of rising costs. Union leaders want to lower the employee contributions in the company's proposal, while many workers are seeking continued free coverage.