Union wary of any rush into a deal

Comprehensive labor negotiations are set to begin Monday.
By DON SHILLING
VINDICATOR BUSINESS EDITOR
NEW YORK -- A union leader from Warren is wary of optimism from Delphi Corp. that new labor contracts can be reached before court hearings resume May 24.
At the close of hearings Friday in New York, company attorney Jack Butler said negotiators have started talking behind the scenes and will sit down next week in several cities for comprehensive talks.
"Hopefully, we'll be able to report back with substantial progress, if not a resolution, with at least one of the bargaining units," Butler said.
Don Arbogast, shop chairman of the Warren unit of the International Union of Electrical Workers, said he's not getting his hopes up.
"Frankly, based on my experience in dealing with Delphi since last October, I'm not expecting anything good to come out of Delphi," said Arbogast, who was reached at home.
He added, however, that he will attend the talks Monday in Troy, Mich., and said the "IUE will put forth its best, 100 percent effort."
Arbogast is on the national bargaining committee for the IUE and is the lead bargainer for Local 717 at Warren-based Delphi Packard Electric Systems. The IUE represents about 8,500 of Delphi's 34,000 hourly workers.
Three days of hearings were held this week in federal bankruptcy court on Delphi's motion to cancel its union contracts. It says that to survive it needs cuts in wages and benefits and that negotiations with the unions have been fruitless.
Butler said talks have been set up with five of six Delphi's unions. He wouldn't identify the union that isn't involved but said he was hopeful it would be included in the talks.
Where judge stands
In court, Judge Robert Drain reminded the parties that he doesn't want to decide the case. The best decision will come from negotiations, he said.
"Please do everything you can to reach an agreement," he said.
The judge didn't schedule any hearings next week to give the sides time to negotiate. The next hearing dates are May 24 and 26.
Other matters in the bankruptcy case are scheduled for three other dates through June 5. Those dates could be used for more testimony on contract issues, however, Butler said.
Testimony has been completed on only five of Delphi's scheduled 13 witnesses. Next up is John Sheehan, the company's chief restructuring officer.
Union lawyers have been detailed in their questioning, including asking one witness nearly 400 questions over two days. The unions have been trying to show that Delphi has not bargained in good faith and hasn't been fair in its offers.
The unions have 21 witnesses scheduled after Delphi completes its case.
The company's witnesses have not given direct testimony because they have written statements on file.
At Friday's hearing, union lawyers questioned Michael Wachter, an economist with the University of Pennsylvania who conducted a wage study for Delphi.
Average wage
Wachter said $13.39 is the average hourly wage for machine operators and handlers, the two classifications that cover Delphi production workers. The top pay for Delphi workers is $26 an hour.
Wachter, who has done similar work for other companies in bankruptcy, said Delphi's wages are more above national averages than any company he has studied.
Lawyers for various unions suggested, however, that Wachter used categories that are too broad and include workers that aren't comparable to Delphi's press operators, such as workers who press pants at dry cleaning companies.
Tom Kennedy, an IUE lawyer, tried at length to show that the $13.39 average pay included both higher- and lower-paid workers, depending on responsibility, productivity and value of the work.
He asked Wachter if the salary range for machine operators and handlers would be from minimum wage to $30 an hour. Wachter said he didn't know.
Kennedy said he represents garment workers in New York who would fall into these classifications and suggested that they make minimum wage. Wachter again said he didn't know.
Wachter did say that employers sometimes pay workers higher-than-average wages based on seniority and productivity.
What was pointed out
Kennedy asked about workers at Delphi's plastic injection molding plant in Cortland, who receive the company's top pay scale. If the plant produces 1 billion plastic parts a year and has a zero-percent defect rate, don't those workers deserve more pay than the national average, he asked.
Wachter said companies don't necessarily have to pay productive workers more because they can promote them to higher positions.
On the other side of the pay scale, Kennedy pointed out that seven Delphi plants with IUE workers already have labor contracts with decreased wage rates in order to help the company be competitive. The average wage at those plants is $12.41, about 9 percent less than the market average cited by Wachter.
Kennedy has been pointing out through the hearings that the IUE has worked with Delphi in the past to make troubled plants more competitive and that not all IUE workers earn $26 an hour.
Also on the stand was Steven Gebbia, Delphi's director of benefits. He said Delphi wants to provide benefits to hourly workers at the same level of other auto suppliers so Delphi can compete with them.
Kennedy questioned Gebbia to try to show that Delphi hasn't made fair contract offers. Gebbia said the company's current contract offer calls for hourly workers to receive lower sickness and accident, disability and life insurance benefits than salaried workers.