IBEW Locals 1362 and 1364 gain 21% in new Rockwell-Collins contract

From the Gazette Online:
Article published: May 3, 2008
Rockwell Collins workers OK new contract

CEDAR RAPIDS The unions representing Rockwell Collins hourly employees in Cedar Rapids, Coralville and Dallas, Texas, on Saturday approved a new five-year contract providing 4 percent annual wage increases — a 21.6 percent increase over the life of the contract.

Members of International Brotherhood of Electrical Workers Local 1362 ratified the contract with the aviation electronics company Saturday at Veterans Memorial Coliseum in Cedar Rapids. The other unions voting for the contract were IBEW Local 1364 in Coralville and IUE-CWA Local 787 in Dallas.

In addition to the wage increases, the contract enhances retirement benefits, changes vacation accrual from an annual basis to a monthly basis, upgrades employees in five job codes and creates three new job codes, said Local 1362 Business Manager Jerry Vuichard.

Rockwell Collins spokeswoman Pam Tvrdy said. "We're very pleased that we were able to come up with a package that everyone could accept."

The contracts also address the possible disruptive effect of a large number of retirements following ratification. In Local 1362, 450 members are eligible for retirement, and many had postponed their retirements until after the contract to have greater certainty about the health insurance benefits they'll receive.

A new "retirement window" program will enable many of those 450 union members to receive a $10,000 bonus by scheduling their retirements in cooperation with the company, Vuichard said. The program is set up for people with at least 30 years of service who retire between this Oct 1 and March 31, 2010, and is structured to minimize disruption to the company's operations, Vuichard said.

Other improvements include an increase of 6 percent in the portion of the company's traditional defined benefit pension plan accrued before 1992, and an increase in the company's match on the 401(k) defined contribution pension plan. The company will match 50 percent of the first 6 percent of wages and overtime that an employee contributes to his 401(k) plan.

The company's 401(k) contribution was previously capped at $750 per year.

Health insurance premiums increase in the package, but benefits are left intact, Vuichard said.

Rockwell Collins and Local 1362 will establish a labor-management committee under the contract. Vuichard said the committee will focus on boosting prosperity for both the company and bargaining unit employees, on keeping work in Cedar Rapids and on "creating a well-valued work force."

Rockwell Collins' profits and sales have shown strong growth, with profits up 20 percent in the three months that ended March 31. The company recently boosted its stock dividend by 50 percent, to 24 cents per share, and has spent $190 million to repurchase 3 million of its shares.

The union locals in Dallas, Coralville and Cedar Rapids negotiate their economic contract terms jointly with Rockwell Collins, while other contract provisions are negotiated separately.