The UAW had reached a tentative agreement on a new six-year contact with the company two weeks ago, only to see 90% of the rank-and-file members of the union reject it in a ratification vote that concluded this past Sunday. Union and management negotiators talked into the night Wednesday trying to reach a new deal but were unable to do so.
However, the US Labor Department reports that the number of strikes so far this year is actually down compared to the same period of 2019, the year before the Covid-19 pandemic riled labor markets.
Good times at Deere
The strike at Deere & Co., the formal name of the company popularly known as John Deere, shuts operations at 11 factories in Illinois, Iowa and Kansas, and three distribution centers in Georgia, Illinois and Colorado. The company makes both agricultural and construction equipment. Demand for its products has been strong.
The company said in August that it sees growing orders through the rest of this fiscal year that runs through November 1, and into the first fiscal quarter of next year.
The rejected contract for UAW members at John Deere would have given them immediate raises in their base pay of 5% to 6%, and additional wage increases later in the contract that could have increased average pay by about 20% over the six years of the rejected deal. It also eliminated a second lower tier of pay for some more recent hires of the company, bringing them up to the pay of other UAW members.
The average production worker at Deere made about $60,000 last year, and could end this contract earning about $72,000.
But unlike the last two UAW contracts at Deere, which were negotiated during difficult times for the company, these negotiations took place at an especially good time for the company.
That might have made reaching an agreement that membership would embrace more difficult. The current financial success at Deere may have led some of the union members to believe they deserved an even better package than the one that was rejected, especially after less lucrative deals in the past.
The company has been hiring during the last year as well, as union-represented jobs at Deere climbed 19% since November 1 of 2020.