Union: Filing is bid to dump pension plans

One Delphi Packard worker said he would not be open to large cuts in his pay.
By ED RUNYAN
VINDICATOR TRUMBULL STAFF
WARREN -- While the shop chairman who represents workers at Delphi Packard railed against the "corporate greed" driving the company's Chapter 11 filing, workers and retirees expressed their own opinions.
Donald O. Arbogast, shop chairman for the International Union of Electrical Workers Local 717, says the bankruptcy was unnecessary and reflects the company's desire to exploit the system for dumping pension plans on the federally funded Pension Benefit Guaranty Corp.
He and IUE President Gary M. Reiser spoke Monday at a news conference at the union hall on Sferra Avenue.
Delphi is "expecting the American public to pay off" the company's pension commitments, Arbogast said, a practice the company's new CEO and chairman seems to be skilled at carrying out.
Restructuring expert
"It was a well-planned and executed plan to shift costs to the American taxpayer," he said.
"There's not one question the bankruptcy could have been prevented," Arbogast said. Instead, the company hired Robert S. Miller, a restructuring expert, in July with every intention of filing for bankruptcy, he said.
The company filed for bankruptcy Saturday. A company attorney said Delphi would attempt some restructuring of its collective bargaining agreement with the United Auto Workers, which represents workers in other areas. It will also try to scale back pension benefits.
Seeking wage cuts
A letter sent from UAW leaders to union members in Kokomo, Ind., last week said Delphi asked the UAW to accept wage cuts of more than 50 percent, to $10-$12 an hour, and eliminate the jobs bank. Delphi also asked for a reduction in health-care benefits and vacation time.
One worker, asked his opinion of a possible scale-back of his contract, said he wouldn't accept such a deal.
"It'll never happen on my vote," said Bill Perkins of Masury, who works at the North River Road facility.
"I need a raise. With gas and everything going up, if they think I'll vote to go backward they're on drugs," he added.
Perkins said he agreed years ago to such cuts when he worked for Sharon Steel Corp., and the company still closed, he said.
Had opportunity
Arbogast said Delphi Packard has passed up the opportunity to save on labor costs over the years in the Mahoning Valley by not hiring more employees at the lower-tier wage levels the union agreed to years ago.
The IUE contract at Delphi Packard calls for some workers to make 55 percent of the $26 per-hour wage rate most workers get. But the company has refused to hire workers in recent years, so most workers are at the top rate, he added.
Of the 3,800 Delphi Packard hourly workers, all but 210 are at the $26 rate, he said. There are two lower tiers, one that keeps workers permanently at the 55 percent rate and another that allowed workers to move from 55 percent to 100 percent, he said.
Job bank
Likewise, he said the company just last week moved 137 more people in the job bank, a system in which workers report to work and get paid most of their salary but only sit on benches and read. There are 337 people currently in the job bank, he said.
Arbogast said the union had a meeting for union members Sunday night at the hall to "calm them down." He said he told union members the bankruptcy is not the "process we wanted" but that "we will defend ourselves."
He said the company has not had any negotiations with IUE Local 717. Nonetheless, he said he thinks pensions for former Packard and Delphi Packard workers are guaranteed no matter what happens in the bankruptcy.
Reiser said Delphi Packard has double the number of retirees as active employees, most of which receive pensions from General Motors. Relatively few get their pensions from Delphi Packard -- only those who have retired since the spinoff from General Motors in 1999, he said.
Henry Mines of Howland, who has been retired from Packard for 22 years, said he considers the GM pension he receives to be generous but believes he will eventually "take a cut."
Although he says he has not received any notice from the company indicating any kind of reduction, he says he believes GM is "in the same boat, practically" and will run into the same type of trouble as Delphi.
Another retiree, who wished to remain anonymous, said he already has trouble with his health-care benefits because the insurance company routinely refuses to pay for procedures for his wife.
The man, who was at the IUE Local 717 office Monday to seek advice on getting the bills paid, said he has had to appeal the insurance rejections more than once.
He said his pension was cut in half when he turned 62 and qualified for Social Security and fears rumors that the other half will be cut in 2007.
Normal operations
Company officials met with employees Monday to stress that the operations are continuing normally, despite the bankruptcy filing, said Ann Cornell Vickers, a Delphi Packard spokeswoman.
Employees were told that contract negotiations and bankruptcy court rulings are being handled at the headquarters level. The job locally is to continue making and shipping high quality products, Cornell Vickers said.
"It's critical for us not to miss a beat with our customers," she said.
Also, company officials have been talking to suppliers and customers and will continue doing so, she said.