IBEW Local 86 (Rochester, NY) Members Vote in Salary Reduction/Incentive Pay Rise at Victor Insulators, Inc.

Pay cut passes at Victor Insulators

Amy Wu, Staff writer, Rochester Democrat & Chronicle, February 17, 2005

— Workers at Victor Insulators Inc., one of the oldest insulator makers in North America, voted Wednesday to take a 20 percent pay cut rather than face the potential bankruptcy of the company.

After a week of discussion, the 96 union workers voted 61-26 in favor of accepting a salary cut. The company tried to soften the blow with an incentive system that will give its 118 employees an opportunity for bonuses based on productivity and business.

The latest developments had come as a surprise to the union and its members, whose contract does not expire until 2007.

While workers were frustrated by the unexpected turn of events, the International Brotherhood of Electrical Workers Local 86 said most seemed supportive of the proposal.

"It seems to be a workable resolution because there is a plan there to recapture the lost wages," said Dan Conte, the union's business manager.

Victor Insulators, at 280 Maple Ave. in Victor, did not have alternatives, said Ira Knickerbocker, company vice president.

"If we hadn't gotten this change in compensation system, it would be too close for comfort," Knickerbocker said.

Earlier this month, management began getting pressure from the company's financial backers and board members, who were troubled by a downward spiral in sales. Although the U.S. insulator industry has been suffering for the past five years from growing overseas competition, Victor has been hit especially hard in the last few months by rising energy and labor costs.

The majority of Victor's workers have been at the company for more than 16 years, and they were paid $9.25 to $14 an hour before the reduction proposal.

Executives at Lapp Insulator Co. of Le Roy, Genesee County, a direct competitor of Victor, were saddened by Victor's news.

"Victor was the founding company of this industry. We all come from common roots ...," said Rob Johnson, vice president and general manager of 113-year-old Lapp.

"The market is weak, cost structures are difficult and competition is fierce. It's not Lapp, it's not Victor; it's the whole business."

AWU@DemocratandChronicle.com