The union representing about 14,000 striking Goodyear Tire & Rubber Co. workers approved a new contract that includes plans to close a Texas tire factory and creates a $1 billion health care fund for retirees, the United Steelworkers said early Friday.
USW union members from 12 plants in 10 states, including about 1,400 laid off and inactive workers, voted Thursday night on the three-year agreement reached last week.
The contract was approved by all locals and by the overall membership by a two-to-one margin, the union said. Exact totals were not released. The contract needed to be approved by a majority of the locals, plus a majority of the voters.
The world’s third largest tiremaker and the union reached the deal after both sides resumed talks in Pittsburgh last week. The strike began Oct. 5.
'A fair and equitable contract'
“It took a strike, but we achieved a fair and equitable contract that protects quality health care for active and retired members,” USW executive vice president Ron Hoover said in a statement. “And by winning major capital investment expenditures, it secures our jobs for the future.”
Striking workers were expected to return to work beginning Tuesday, the union said. Workers at four Goodyear plants in Ontario, Canada, where about 400 union members are striking at four plants, planned to vote Thursday and Friday on a separate proposal.
The contract with U.S. workers would allow the tiremaker to close a plant in Tyler, Texas, but not immediately. It provides for a one-year transition period in which the workers will have the opportunity to take advantage of retirement buyouts. The plant employs 1,100 workers who make unprofitable wholesale private label tires.
“It’s a bittersweet outcome,” said Kevin Johnsen, a union contract coordinator. “We wanted to win Tyler protected status like the other plants, but we only got it for 2007.”
One key issue during the nearly 3-month-old strike had been over a company proposed health care fund for retirees.
Goodyear ultimately agreed to put $1 billion into the fund for retired union workers’ medical benefits, which was higher than the company’s previous $660 million offer but less than the union’s call for roughly double that amount.
'A stronger employer'
The Akron-based company said the pact will help it significantly reduce its costs.
“The end result is Goodyear will be a stronger company, a stronger employer and a stronger overall global competitor,” chairman and CEO Robert Keegan said in a statement.
Before the vote, some union members at halls across the country expressed concern about the proposal, saying they feared the retiree health care fund was underfunded and that they questioned job security. But many of them said the believed the pact was the best deal they could get.
Terry Huddleston, a 14-year Goodyear worker in Akron, said he voted for the agreement but with some reservations, saying he believes the rank-and-file have had to sacrifice too often.
“It’s unfortunate,” Huddleston said. “I love all these guys. God bless them. We’ve managed to stick it out for three months, but a lot of families are suffering.”
The new contract covers tire and engineered product plants in Akron; St. Marys, Ohio; Marysville, Ohio; Gadsden, Ala.; Tonawanda, N.Y.; Lincoln, Neb.; Topeka, Kan.; Fayetteville, N.C.; Danville, Va.; Tyler, Texas; Sun Prairie, Wis., and Union City, Tenn.
During the strike, Goodyear made tires at some of its North American plants with nonunion and temporary workers as well as some managers. The company counted on production at its international plants to help supply North American customers, but some dealers said there was a shortage of some specialty Goodyear tires.
The union publicly expressed concerns about the safety of the newly trained workers who quickly took over tire-making jobs and the quality of the tires they made. Goodyear said the workers followed the same safety and quality standards union employees did.
Goodyear has about 80,000 employees and makes tires, engineered rubber products and chemicals in 29 countries.
Goodyear shares closed down 21 cents at $20.01 Thursday afternoon on the New York Stock Exchange. Shares hit a new year high Tuesday at $20.38. The 52-week low was $9.75.