Striking Union Members Reject CNH's 'Last, Best, Final' Offer

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United Auto Workers union members on strike at two CNH Industrial plants rejected the company's "last, best and final offer" to end the eight-month-long walkout.

The manufacturer of Case and New Holland construction and agricultural machinery said the offer included a wage increase of 25% to 38% over the four years of the contract.

Approximately 1,100 workers (about 400 in Burlington, Iowa, and 700 in Racine, Wisconsin) between the two plants have been on strike since walking off the job May 2, 2022, to challenge wages, overtime, vacation and retirement benefits.

The vote January 7 was reportedly divisive between the two plants. The final tally came down to 55% of voting members rejecting the proposal and 45% voting in favor and ready to return to work. The Milwaukee Journal Sentinel reported that the division in the vote was nearly split between the two plants, with the offer reportedly garnering approval in Burlington and rejected in Racine.

However, despite this apparent division, until a deal is approved, the strike will continue. UAW officials will meet to discuss the steps with CNH in the aftermath of the offer’s rejection.

The strike started seventh months after a similar challenge by 10,000 John Deere workers in October 2021 that lasted five weeks, concluding with employees receiving 10% raises and improved retirement benefits.

Caterpillar reportedly has an agreement with UAW union workers coming due in 2023. However, UAW leaders don’t believe CNH cares what Caterpillar comes up with, nor what transpired with John Deere.

The union says the ball is in the court of CNH to end the strike, while the company says it's up to the union to return to the negotiating table and accept an offer.

“CNH Industrial is disappointed to learn that its recently negotiated and improved ’last, best and final offer’ was not approved,” the company said in a statement. CNH encouraged UAW to allow the workers to reconsider their position in another vote so they can return to work.

“While we await the union’s next step, CNH Industrial remains committed to honoring and meeting the needs and demands of our customers and, therefore, we will continue operations at both our Burlington and Racine sites,” the statement reads.

CNH brought in a temporary workforce within days of the strike to ensure the plants continued to operate. Union officials suggest the workforce had assembled before the contract deadline, possibly in anticipation of the strike being called. It has not been defined what sort of wages these workers are being paid, although reports have suggested as much as $27 an hour, which exceeds pay rates for current employees.

However, during the company’s third-quarter financial results call in November, CEO Scott Wine said shifting production from different facilities occurred but did not specify which locations.

In July 2021, The Hawk Eye newspaper reported that CNH was having ongoing discussions with the local UAW 807 in Burlington about moving its Case M Series dozer production from Burlington to an undisclosed location outside of the U.S. The dozer line had been added with a $24 million expansion at the plant in 2015 when CNH closed its Calhoun, Georgia plant. 

Since 2021, the plant continues to produce the Case dozers, and no subsequent information has been released on any movement of that line. It is not clear if any further discussion of moving the line will be part of the current labor negotiations.

According to the union representatives, workers in all other CNH plants in North America are making more than those at Burlington and Racine.

Before January 7, no formal vote had been taken on any offer presented to the union by CNH. The last formal offer presented by CNH on May 19 was rejected by UAW with no vote being taken because the offer fell far short of the members’ bargaining agenda. CNH described that offer as a significant financial boost from its original offer on May 1.

The two sides returned to the bargaining table on June 14 after U.S. senators, including Bernie Sanders, D-Vt., and Tammy Baldwin, D-Wis., sent a letter to the company and visited the picket lines at the plants. However, union leaders said CNH showed little movement from its May 19 proposal, merely moving some of the money around to make it appear different from the previous proposal. 

Based on the content of the proposal, negotiations halted again with no future dates scheduled until the meetings that started on August 15 and continued the following week with little success. 

Richard Glowacki, chairman of the bargaining committee for UAW Local 180, categorized those talks as CNH leaving the union "breadcrumbs." He said CNH sought to unilaterally impose a new deadline, under which if no ratified agreement was reached, the company would revert to its last proposal.

At the end of September, CNH reportedly put an offer on the table that it called its "last, best and final" offer. Some reports suggested that the version of the offer almost came to a vote at that time. However, union leadership denied this, saying it was “unacceptable” in the form it was written.

Following those negotiations, CNH placed ads in local media near both facilities highlighting details of the proposal that allegedly was not presented to the union members in full.

On Saturday, during his presentation of the latest offer to union membership, Glowacki told the Journal Sentinel he was shocked at the little amount of conversation.

“I didn’t have to say anything bad about the proposal; the proposal spoke for itself,” he said. “They’re not happy. They feel betrayed. They feel the company should be compensating them better; the benefits should be better; the health insurance needs to be better.” 

Glowacki noted that both CNH and the union have some work ahead of them. "I’m not saying this is a one-party deal. Both parties must work together to try to come to an agreement that we can live with.” 

Despite the optimism of some resolution to the strike eventually occurring, union members in both Burlington and Racine have taken other jobs. Traditional UAW strike rules prevent striking members from having a job that provides more than what strike pay is being allocated. For the CNH strike, that rule is not being applied, and several members have found other part- or full-time jobs and continue to receive strike pay if they complete four hours of strike duty per week. 

There is concern among union leadership that some workers will not return upon finding other higher-paying jobs. Per the rules, the members do not have to tell the union if they don’t intend to return to work once a contract is ratified.