- The Washington Times - Friday, December 29, 2006

Goodyear Tire & Rubber Co.’s largest union has approved a new contract, ending a three-month strike in the U.S. and allowing North America’s biggest tiremaker to shut a factory and trim 1,100 jobs.

A new three-year deal, which covers 14,000 workers at a dozen plants in 10 states, was approved by members by a more than two-to-one margin, the union announced yesterday.

“It took a strike, but we achieved a fair and equitable contract that protects quality health care for active and retired members,” said United Steelworkers Executive Vice President Ron Hoover. “And by winning major capital investment expenditures, it secures our jobs for the future.”

The contract establishes a company-financed trust of more than $1 billion for medical and prescription drug benefits for current and future retirees. Medical and prescription drug coverage for active and retired members also was maintained.

Mr. Hoover said Goodyear’s commitment to invest $550 million in union-covered U.S. plants during the next three years “secures our jobs for the future.”

The new contract creates a wage range of $13 per hour to $24 per hour, a cut in starting pay for new employees but a protection of pay for current workers. There were no raises, but the deal allows for cost-of-living increases for hourly workers.

Many union officials and workers expressed mixed emotions about the deal, which allows the tiremaker to close a plant in Tyler, Texas, in 2008, provided the company closes a non-union plant first.

About 1,100 Tyler workers who make unprofitable wholesale private-label tires are eligible for buyouts of up to $40,000, plus two years of health benefits.

“Its a bittersweet outcome,” said Kevin Johnsen, the union’s Goodyear contract coordinator. “We wanted to win Tyler protected status like the other plants, but we only got it for 2007.”

Some workers said they are worried about job security and fear that the retirement health care fund will be underfunded.

In addition to the Tyler plant, the contract covers facilities in Danville, Va; Akron, St. Marys and Marysville, Ohio; Gadsden, Ala.; Buffalo, N.Y.; Lincoln, Neb.; Topeka, Kan.; Fayetteville, N.C.; Sun Prairie, Wis.; and Union City, Tenn.

Goodyear officials said the pact will help the company significantly reduce its costs, making it a stronger global competitor and employer.

“Our goal was to reach a fair agreement that enhanced our ability to be competitive and this agreement does that,” Goodyear spokesman Ed Marke said.

Goodyear shares hit their highest level in a year yesterday, rising $1.26, or more than 6 percent, to $21.27 on the New York Stock Exchange. The previous high of $20.38 was reached Tuesday after word that the company had reached a tentative deal with the union Dec. 22 after the markets closed. The year’s low was $9.75.

This article is based in part on wire-service reports.

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