About a month ago, I began seeing pro-Union yard signs in our fairly conservative town. I wondered about it at the time, but last week I found the reason for it. Kohler is on strike. The workers are protesting a too-small wage increase and a too-large jump in insurance costs, but mostly they are angry about the two-tier wage system the company has in place. There was anger over this five years ago when the Union agreed to the last contract; this time around the workers have had enough.
Kohler Company, located about five miles west of Sheboygan in the Village of Kohler, is one of the biggest employers in the county. They are probably best known for manufacturing sinks, toilets and bathroom fixtures and the stylish print ads for their bathtubs are highly regarded by graphic designers. They also have a small engine division. The Herb Kohler family founded an art museum in downtown Sheboygan, and sponsor an annual arts festival. They also have two world-class golf courses in the county (Whispering Straits hosted the PGA tournament last summer). When I graduated from high school, I got a Kohler scholarship. Kohler is Big.
Kohler Company has seen its share of strikes. A particularly brutal one in 1934 won workers the right to replace the “company union” established by management with an independent union elected by the workers. The strike of 1954 lasted 9 years before the company was finally forced to return to the bargaining table and a couple more years before an agreement was finally reached, making it the longest strike in U.S. history.
The most recent strike was back in the ‘80s; Kohler hasn’t had a strike in 32 years. Until now.
This past week the Union voted to reject the Company’s “last best offer” for a new contract. At issue are the 50-cent pay increase, which the Union says is insufficient, and the huge spike in the cost of the benefits. The company insists that everybody will be getting a bonus too which will compensate for the rise in benefit cost, but the Union disagrees. But that’s not the big issue; they might have grudgingly ratified the contract if it was just about the money.
Five years ago in the last contract, the Company instituted a two-tier system where new hires start out at a lower base pay than the established ones. There were grumbles about the new system at the time, but back then the economy was still struggling to emerge from the 2008 Recession, and I suppose people thought they were lucky to have a job at all. That certainly was Management’s position.
It makes me think of the situation of a place where I worked about a decade ago; an auto parts plant here in town that made acoustical panels and truck beds for pickups and SUVs. The plant had formed a union in 1997, shortly before I was hired. At the time, management made a conscious decision to not fight the union, deciding that working with their employees would be better for the company. I like to think that we repaid Management’s trust, because our plant was consistently recognized, both by the parent company and by the industry in general, for the quality of our product. But productivity wasn’t good enough as the auto industry slowed down in the years leading up to the official start of the Recession. Lack of orders forced our plant to lay off workers and eventually shut down.
A couple years later it was bought out by another company and started up again. Everyone was hired back and for a while things were looking optomsistic. Then came word that our plant was bidding for a contract with a new customer, a major GM plant. This new order would guarantee that not only would the plant stay in business, that it would be able to hire new workers too. The only thing was that the Company wanted to hire the new workers at a lower rate than the base pay established in the contract.
The new owners of the plant had bought out the contract too so it was still in effect; and any changer to the base pay would need to be approved by the union membership.
So we had a meeting to discuss the change. A lot of members argued that this would effectively make the new hires “second-class citizens” in the company. This wasn’t the matter of Lazy Union Workers Being Greedy, because the change would have affected the pay of no one in that hall; neither was it about Greedy Union Bosses Wanting to Maximize Their Union Dues, because our Bargaining committee was recommending that we accept the Company’s request. This was a matter of fairness.
After a vocal and contentious meeting, the Union voted to ratify the change. I was one of the members who voted “Yes”. I agreed that the lower pay scale for new hires was unfair, but I felt that it was something which could be fixed in future contracts; and also I was concerned that without this concession we’d lose the new order and the plant would close.
Seeing how a similar situation played out at Kohler, I suppose I was wrong. Maybe we wouldn't have been able to correct the two-tier pay system and it would have become the New Normal. But as things turned out, the GM plant in Janesville we were courting shut down, and so our concessions were for nothing. No new orders, no new employees, and within a month or two the new owners shut down the plant.
And adding insult to injury, the Company docked our pay for the time we took off work to attend the meeting to vote on the changes they requested. But that was probably an unintentional error on their part and they did correct it.
Back to the present situation, before the vote I was chatting with a co-worker at my current temp assignment about the Kohler situation. She was saying, “Yeah, but even if two thirds of the workers decide to strike, that leaves how many? Maybe a thousand? workers who are stuck with a strike they didn’t want.”
She was off with her guess. The vote was 94% to reject Kohler’s “Last Best Offer”.
It’s about fairness; and resentment at Kohler Management. Unlike the plant where I worked a decade ago, Kohler Co. is not struggling; Herb Kohler enjoys a nice comfortable income and is even trying to build a third golf course. Because you can never have too many, y’know?
The previous Kohler strikes in 1934 and 1954 were marked by violence. Already there has been anger about strikers blocking traffic. A Company rep, on hearing the Union’s vote, sniffed, “What do they think they can accomplish?”
I dunno. Christmas is coming and Kohler Management is betting that their workers won’t have the stomach to hang in there for the long haul. But I think this strike will be a long one.