Union's resistance to Hormel wage cuts parallels labor's '84 bargaining stance
Union protests against wage cuts put into effect by George Hormel, chief of the Hormel packing company, have changed employee relations from harmonious to acrimonious - and could lead to a showdown when a new contract must be negotiated in late 1985.
The bitterness that led to a demonstration and rally against Hormel and a major Minnesota bank where it does business resulted from a company decision in October to lower workers' wages by 23 percent, or for a typical employee from $ 10.69 an hour to $8.25.
Hormel, based in Austin, Minn., had earlier negotiated reductions to $9 an hour at six other plants under a contract clause that, as the company interpreted it, allowed reductions to the wage level of competitive meatpackers.
Hormel said it needed pay cuts to maintain its small profit margin. Competitors, it noted, had won wage concessions from workers which reduced their labor costs substantially.
In turn, offices of the United Food & Commercial Workers local in Austin called the company ''sufficiently profitable'' to continue wages at levels set in its labor contract.
The dispute is in arbitration but the local union, which represents 1,750 workers, announced at its Dec. 9 rally that it has retained a New York union consultant to help it muster support nationally against ''the injustice the working man gets from a man in a pin-stripe suit,'' said Jim Guyette, president of the local.
Generally, United Mine Workers, the United Automobile Workers, and other major unions have successfully resisted concessions in 1984 bargaining. But where employers face financial pressures as a result of competition, unions are still giving ground in bargaining to preserve jobs.
Recently 2,500 employees of Trailways voted in favor of a 10 percent pay cut, a three-year wage freeze, a 25 percent reduction of starting pay for new employees, and changes in work rules. The moves were needed, Trailways said, to keep it competitive with Greyhound Lines and low-cost airlines.
Greyhound won similar concessions last year after a seven-week strike.
Western Union Telegraph Company asked its 8,000 employees for wage and other concessions to help it offset losses of about $7 million a month.
Two unions, considering giving the company ''temporary'' relief, said, ''It's a crisis situation and we have to deal with it.''