- Associated Press - Sunday, November 8, 2015

BATH, Maine (AP) - With labor tensions high and criticism over constructions delays, Bath Iron Works is getting off to an early start on negotiating a new contract with the largest union at the shipyard.

The Navy shipbuilder told Machinists Union Local S6 that it wants to negotiate contract changes by year’s end, instead of waiting until spring when the current labor contract expires, so it can shore up the framework for a labor pact to produce a competitive bid for Coast Guard off-shore patrol cutters in March.

Local S6 President Jay Wadleigh said reaching an agreement by year’s end won’t be easy.

“Some of the changes they’re asking for are hard,” Wadleigh said. “I don’t know if we’re going to get where we need to be or if there’s going to be a showdown in May.”

The shipyard has invoked a clause in the current contract that allows for an early review - not formal contract talks - and hopes to begin the first meetings with the union later this month. The current contract expires on May 22 but the union has reserved the Augusta Civic Center for Sunday, Dec. 13, for a contact vote if an agreement can be reached before then.

The shipyard has already undertaken efforts to save money. It has tried to hire subcontractors to build things like lockers and electrical panels and has sought to implement cross-training for workers. The unionized workforce balked, saying it can make the items more cheaply and that previously implemented cross-training didn’t save money, either.

Workers feel like they’re being forced to carry the load for concessions because of poor management decisions that have contributed to cost overruns and delays in several ships, including the stealthy, first-in-class Zumwalt.

Shipyard managers fear big troubles are looming without changes.

Workers already have been warned that 20 percent of the shipyard workforce could be cut if the General Dynamics subsidiary fails to win the Coast Guard contract. Bath Iron Works hasn’t built a Coast Guard vessel since the 1930s but hopes to outbid two Gulf Coast shipyards for a project that’s worth up to $10 billion.

Years ago, the Navy seemed content to let Bath Iron Works wither in the face of competition from its primary competitor for Navy destroyers, the larger Ingalls shipyard in Pascagoula, Mississippi. Then Hurricane Katrina struck, Ingalls ran into troubles, and the Navy gained a new appreciation for the importance of having two competing shipbuilders.

But the Navy is serious about the need for cutting costs and will choose the lowest cost option, regardless of its appreciation of the quality of Bath-built ships, said Loren Thompson, a defense analyst at the Lexington Institute.

“General Dynamics management and its labor unions understand that in the end, they have to get along because if they can’t, nobody’s going to save them,” Thompson said. “The Navy and the Coast Guard are looking for the best deal possible. Given some of the disadvantages that Bath has in terms of location, they need to have a unified team to win future programs.”

At the Oct. 31 christening of the future USS Peralta, BIW President Fred Harris used the opportunity to talk about the shipyard’s challenges, saying “competition for these ships has never been more intense.”

“We have no other option,” he said. “We must change.”

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