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Deere workers approve new contract, ending strike

Workers at Deere & Co. ratified a new six-year contract Wednesday, ending a strike against the farm and construction machinery company that lasted over a month.

The contract was approved by a margin of 61% to 39%, the United Auto Workers union said.

Deere said some workers will return to their plants as soon as the overnight shift early Thursday. Workers voted on a third contract offer crafted by negotiators late last week after two earlier offers failed.

“We’re giving employees the opportunity to earn wages and benefits that are the best in our industries,” Deere Chief Executive John May said in a statement. “We have faith that, in return, our employees will find new and better ways to improve our competitiveness.”

The offer that prevailed grafted an increase in base production pay onto the general raises, bonuses and improvements in pension funding from an offer rejected Nov. 2. Following that vote, Deere said that it wouldn’t bargain further on regular wages and bonuses and urged workers to reconsider their opposition to the offer, which Deere said would cost it $3.5 billion.

Workers walked off their jobs Oct. 14 in the first strike against Deere in 35 years. In turning down earlier proposals, striking employees said Deere should provide bigger raises and benefit expansions at a time when the company’s equipment sales are the strongest in years. Deere has forecast about $5.8 billion in income for its full fiscal year, compared with $2.8 billion in 2020 and $3.3 billion in 2019.

“Our members’ willingness to strike in order to attain a better standard of living and a more secure retirement resulted in a groundbreaking contract and sets a new standard for workers,” said Chuck Browning, director of the UAW’s agricultural implement department, in a written statement.

Deere is one of several large U.S. companies confronted with striking workers lately as a tight labor market and rising inflation encourage workers to push for higher wages and better benefits. Workers also have conducted strikes at snack-food company Mondelez International Inc., commercial-truck maker Volvo and breakfast-cereal company Kellogg Co.

Moline, Ill.-based Deere said workers at 14 plants would be returning to work. With the strike over, the company can shift its focus to ramping up production for a bulging backlog of orders for next year’s growing season.

A rebound in the agricultural economy this year is being fueled by a rally in prices for major farm commodities such as corn and soybeans. That is pushing up incomes for farmers and boosting markets for land and equipment.

Farmers and dealers have worried that shipments of Deere’s equipment would be delayed by the strike. Buyers who place orders through Deere’s early-ordering program, which this year started in August, typically get their equipment in January or February, dealers said.

Production at Deere’s factories slowed to a trickle during the strike as the company deployed supervisors and nonunion employees to distribute replacement parts and complete machinery that was mostly assembled at the time of the walkout.

Deere workers returning to assembly plants and warehouses will get an immediate 10% raise, and each worker will receive an $8,500 bonus. Additional 5% pay raises will be provided in 2023 and 2025, and lump-sum bonuses amounting to 3% of workers’ annual pay will be awarded in the three other years.

The deal approved Wednesday also will increase the base pay level for Deere’s continuous-improvement program by about 4%, giving workers more weekly pay from the program if their productivity meets the company’s goals. About two-thirds of UAW-represented Deere workers receive production-based compensation on top of their regular wages, according to the company.

Deere workers said they encouraged union negotiators to push for changes in productivity pay after it was mostly untouched in the two contract proposals that failed in recent weeks.

 

This story has been published from a wire agency feed without modifications to the text

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