Uniroyal Official Says 81-Day Strike Having Severe Impact On Earnings
8-10-63 [handwritten]
NAUGATUCK —The chairman and president of Uniroyal, Inc. reported in a letter to stockholders this weekend that the impact of the 81-day strike on earnings and income is severe.
George R. Vila, chairman and president, said that the “impact on earnings is severe because fixed costs in the striking plants continue without the production necessary to absorb them. As a consequence, net income for the second quarter will be sharply lower than the $1.06 a common share in 1966.”
Raymond Mengacci, executive vice president of Local 45 UIW, said today that he had read the letter and was not surprised at its content.
He said that the letter was almost the same as forwarded to the striking employes of the Footwear Division in May. He also said that it contained the original offer made by the company to URW and to his knowledge the offer has not been changed since then. Many of the strikers are also share holders of Uniroyal under a co-operative stock plan.
The 19 plants idle due to the strike represent about 50 per cent of the employes and over 70 per cent of sales in the United States, Vila said.
“When the strike was called, the company had sizeable inventories in many product lines which helped to cushion the impact on sales,” he explained.
Negotiations with the union started March 21 with initial union demands for wage increases and employee benefits of more than $1.40 per hour for a two-year period, exclusive of pensions and insurance, Vila told the stockholders.
“Several days before the strike deadline of April 20, the company offered a proposal on wages and benefits which totalled 28 cents per hour for a two-year period,” he said. The company estimated that a new pension and insurance agreement to be negotiated in September would add between 20 and 25 cents per hour. The total increased cost would be about 50 cents per hour over a two-year period. The union rejected the offer prior to the deadline.
The company proposed that the employes continue to work while negotiations proceeded. However, this was also rejected.
The company offered on June 5 a three-year contract covering 12 principal points. It totals approximately 72 cents per hour including pensions and insurance, the chairman said.
“It involves increases of 10.5 per cent for the first year, 2.2 per cent the second and 2.2 per cent the third year. This offer has also been rejected by the union,” he said.
Contract Proposals
Specific proposals include the following: wages — in tire plants, an increase of 16 cents per hour in 1967, 11 cents in 1968 and 11 in 1969. In non-tire plants, an increase of 13 cents, followed by two yearly increases of 9 cents.
Skilled trades — 10 cent increases in addition to the above increases, in 1967; vacation pay — two weeks pay for employes with one year of seniority and three weeks vacation pay for five years. The present provision of four weeks pay after 15 years and five weeks after 25 years would continue.
There would also be supplemental unemployment benefits increased from 65 per cent of average pay (plus up to $2 for up to four dependents, with a maximum payment of $50) to 75 per cent of average pay with no maximums for all employes on regular layoff, plus other provisions. The company contributions to the supplemental unemployment fund would be increased from five cents to six cents per hour when the fund falls below 100 per cent. The fund increased from $250 to $350 per employe.
A 60 per cent increase in regular pensions from $3.25 to $5.25 per month per year of service was included. A 60 per cent increase in disability pensions from $6.50 to $10.50 per month per year of service, and an increase of $1.50 per month per year of service for living pensioners who were retired after July 1, 1950.
Other increases included those affecting life insurance, hospitalization, X-ray and radium therapy, visiting nurse, surgical payments and sickness and accident benefits.
Union Warns Strike May Spread
AKRON, Ohio (UPI) — Negotiations were to resume today in the 80-day old rubber industry strike with a warning from a union official here that the walkout could spread.
John Nardella, president of Local 2, United Rubber Workers, said “a strong possibility” existed a strike deadline would be called in negotiations with the Goodyear Tire & Rubber Co.
Other union sources indicated the deadline might be midnight Wednesday.
Nardella said Goodyear negotiators had indicated the company was ready to make a move on its offer, but had not yet done so.
Nardella gave a detailed report Sunday to the Local 2 membership on progress in contract negotiations. He said union policy committee “would initiate a new course of action” if no settlement was reached soon.
Work at Goodyear has continued on a day to day basis since April 20 when the Firestone Tire & Rubber Co., Uniroyal Inc., and the B. F. Goodrich Co. were struck. General Tire & Rubber was struck June 21.
A strike against Goodyear would idle some 21,000 men at 11 plants in addition to the 54,000 men already on strike across the nation.