Many of the nation's major employers will attempt to hold down wage increases to the 2% to 4% level and demand work rule concessions from unions to increase productivity in what promises to be a heavy year of collective bargaining.
Contracts covering 3.8 million workers expire in 1986 in industries including aerospace, construction, oil refining, farm machinery, state and local government, steel and telecommunications, according to the Labor Department's Bureau of Labor Statistics.
A survey by the Bureau of National Affairs (BNA), a Washington-based research organization, noted that many companies will seek the elimination of cost-of-living adjustment clauses, press for health-care cost containment and try to gain two-tier wage structures, which set lower rates for newly hired employees but leave intact the wages of veteran workers. Many corporations also will offer yearly lump-sum bonus payments that do not increase the hourly base wage.
In lieu of major wage increases, unions will be pressing hard for job security gains such as restrictions on the contracting out of work, opportunities for employees to get new jobs in the company and retraining for workers so that they can perform new tasks at a firm that is changing operations.
Many employers, however, indicate that they have no plans to improve existing contract provisions, according to the BNA report.
Labor economist Audrey Freedman said her research concurs with BNA's on the low level of wage increases.
She estimated that union wage gains would average 3.5% this year, less than the anticipated inflation rate of 4%. "We're not going to see any rockets take off anywhere in bargaining this year," she said.
Two of the most significant negotiations will come to a head in August, when labor agreements covering 330,000 telephone workers employed by seven regional Bell companies formerly owned by American Telephone & Telegraph expire and when contracts covering 220,000 steelworkers at six large companies come due. The contracts of another 170,000 telephone workers employed by AT&T also were due to expire Aug. 9, but on Friday the Communications Workers of America announced that it had reached an agreement with the company to allow the contract to expire May 31. The union will begin negotiating on a new contract with AT&T in April and hopes to have it resolved by the end of May so that it can then concentrate on talks with the regionals, which are expected to be more difficult.
There could be dramatic changes in labor relations in both steel and telecommunications.
"Both situations are further examples of the breakup of past bargaining arrangements," said Freedman of the Conference Board, a New York-based business research organization.
The old custom of initially reaching an agreement with one company and using that contract as a model for negotiations with other firms in the industry, a practice known as pattern bargaining, has ended in the steel industry. And this will be the first set of major contract negotiations held in the telecommunications industry since AT&T's divestiture of many of its operating units in 1984.
"This industry has been hit by four factors all at once--divestiture, deregulation, foreign competition and rapidly changing technology. I don't know of any other industry where this happened simultaneously," said Roseann Weissman, public relations director for the Communications Workers.
"All these things are having on impact on jobs. We're going into bargaining in a climate of layoffs, which we've never had in large numbers before," she added.
Whole New Ballgame
Last week, the Communications Workers' bargaining councils met to plan strategy. Some of the parameters already have been set. For the past decade, the union conducted coordinated bargaining on all major issues with AT&T officials, with some specific matters left to local negotiations. Now it's a whole new ballgame.
The CWA will hold separate talks with a smaller AT&T and the seven regional companies that were formed by divestiture. At least three of the regionals, Philadelphia-based Bell Atlantic, Denver-based U S West and Chicago-based Ameritech are insisting that the union negotiate separately with their wholly owned subsidiaries.
Among them, those three regionals own 14 operating companies. Morton Bahr, the CWA's president, continues to insist on regional bargaining.
The union fears that bargaining with individual companies might result in variations in pensions and other benefits that could lead to friction in the union.
Bahr has said that, if the union does not get regional bargaining in those three areas, it will target a particular company, establish a pattern-setting contract there and then negotiate a similar deal at the other companies.
Divestiture also has presented the union with another long-term dilemma, noted Daniel Mitchell, director of the UCLA Institute of Industrial Relations.