---------- Forwarded message ---------- Date: Mon, 9 Mar 1998 23:00:45 -0500 From: Tom Patterson <[EMAIL PROTECTED]> Reply-To: Forum on Labor in the Global Economy <[EMAIL PROTECTED]> To: [EMAIL PROTECTED] Subject: Jointness blues (fwd) US phone jobs by tech change story follows ---------- Forwarded message ---------- Starting Over at Saturn? 'Model' Labor-Management Pact May Be Coming Apart By Frank Swoboda Washington Post Staff Writer Sunday, March 8, 1998; Page H01 SPRING HILL, Tenn.—Since the first car rolled off the assembly line in 1990, Saturn Corp. has been a poster child for labor-management cooperation -- a test lab for American companies struggling to compete in a new global economy. Saturn prided itself on being "a different kind of car company," one where employees and managers worked together in "quality teams" to build great cars. The company's ads touted this team spirit -- and made working at Saturn look like a blue-collar summer camp in Tennessee. But there are troubles in Saturn-land these days, and they are leading some observers to question whether the team-building approach to labor-management relations that has been the company's hallmark is really working. This week, Saturn's union workers will vote on whether to scrap their bold experiment in workplace cooperation in favor of the United Auto Workers' boilerplate national contract agreement with General Motors Corp. -- a traditional, rule-filled document that critics said will impede the kind of easy give and take that made the team approach possible. The 7,000 UAW members at Saturn will decide whether to continue working under the terms of the Japanese-style "Memorandum of Agreement," the 32-page little gray book that has governed life on Saturn's factory floor since the company's creation, or return to the 640-page national agreement governing labor relations between the union and General Motors everywhere else. That bulky contract -- the product of more than half a century of adversarial relations between the company and the union -- is designed to come up with a rule for all eventualities. What's driving the vote is the kind of traditional bread-and-butter worry that created the UAW in the first place. Saturn workers are upset about a shrinking bonus pool and the prospect of layoffs. Management talk about partnership and profit sharing doesn't assuage these worries. The Saturn vote will be watched carefully by other companies that have embraced labor-management partnership -- concerns such Levi Strauss & Co., Corning Glass Works Inc., Xerox Corp. and Magma Copper Co. These companies, like Saturn, empowered work teams on the factory floor to make production and management decisions. And analysts see signs of workplace strain at these companies, as at Saturn. Even the most ardent supporters of the new approach to work agree that the pace of change is slowing to a crawl. Defeat of Saturn's contract "would be a tragedy," said former UAW president Douglas Fraser "There's no agreement like it in the world." Fraser was president of the UAW when the Saturn agreement was adopted. The UAW has taken no official position on the vote. Saturn's problems in remaining a different kind of car company are illustrated by Thomas Hopp, who came here when the Chevrolet Caprice plant near Detroit where he had worked was shuttered five years ago. He was enticed by the prospect of fat profit-sharing bonuses and the promise of a steady job at an auto company with a revolutionary approach to labor relations. But with small-car sales in a slump, the 39-year-old assembly-line worker is worried. The Japanese-style contract that formed the core of Saturn's labor-management relations doesn't have a safety net, he believes, and so he is eager to return to the kind of labor contract he had back in Detroit. "I've been down this road before, and this contract has no protection for us," Hopp said. Across the nation, industrial workers are voicing similar concerns about the labor-management partnerships that were installed during the 1980s and '90s. "They're all relatively fragile; they're struggling to deal with the job-security issue," said Massachusetts Institute of Technology economist Thomas Kochan, who has worked directly with many of the companies and unions involved in cooperative experiments. Patrick Cleary, vice president for human resources policy at the National Association of Manufacturers, said the pace of new cooperative efforts has slowed so much that "I wouldn't say it's incremental enough to constitute a trend." Cleary compared labor-management cooperation to a marriage: "It starts out heady and romantic -- and 50 percent end in divorce." Two weeks ago, under pressure from the Teamsters union, United Parcel Service agreed to end its much-heralded "team concept" experiment after the union filed a complaint with the National Labor Relations Board charging that the company-created work teams were nothing more than an end run around the union contract. Not all attempts at cooperation are failing, but most of the new programs are small ones. The Union Camp Corp. paper company and the United Paperworkers International Union, for instance, have developed a partnership program at an old plant in Franklin, Va. The relationship has been such a success that the company decided to build a new plant right next to the existing mill and keep the union work force. "The rate of incremental growth is not as much as those of us in favor of this had hoped for," said Harry Katz, a labor relations expert at Cornell University. "To some extent we all got caught up with the enthusiasm of the early and mid-1980s." The Saturn saga shows what can happen when a warm and fuzzy Japanese-style labor agreement suddenly confronts a downdraft in the business cycle. The gut issue is layoffs. Under the UAW's national GM contract, workers who are laid off are guaranteed close to full pay for the remainder of the union's contract with the company. Although the union long ago gave up total job security, it has made income security a hallmark of its labor agreements in the industry. But Saturn has no such agreement. The Memorandum of Agreement pledges that the company won't lay off most employees unless forced to do so by "unforeseen or catastrophic events or severe economic conditions." In addition, 12 percent of a Saturn worker's pay is dependent on bonuses that have run as high as $10,000 a year. Last year, however, with sales down, bonuses were $2,015, and there is no certainty what -- if any -- bonuses will be paid this year if sales continue to slump. This approach of linking pay to sales performance is a major part of the Saturn agreement. The way Hopp and his colleagues see it, severe economic conditions may be just around the corner as the company continues to report lowered sales. Saturn sales dropped 10 percent in 1997 and were down 20 percent in January. A flier circulated by Hopp and his supporters last month put the security issue this way: "The job security pledge at Saturn was easy, sales were great. The auto market has changed since Saturn was created. . . . How much money will the company lose before it backs off from its no-layoff policy. Is your job as secure as it was five years ago?" Saturn Chairman Don Hudler sees the current sales slump as part of the normal economics of the auto business. "We're in the real world," he said. "The real world is that there are peaks and valleys." With the price of a gallon of gasoline now less than the price of a liter of bottled water, Hudler said, there's no real incentive for people to buy small cars. Critics also claim that Saturn has not kept pace with its competition -- that its cars, in the words of Consumer Reports magazine, haven't kept up with the pack. Saturn considers the Honda Civic and Toyota Corolla its main rivals. Next year it will start building a bigger car in Wilmington, Del., to compete with the Honda Accord and the Toyota Camry. Hudler acknowledges the company has to deal with the emerging labor issue, and he seems confidant the Saturn work force will vote to keep the existing labor agreement. "I don't think we'll lose it," Hudler said. If the dissidents win? "That isn't the end of the world. We aren't going to shut down; we aren't going out of business." But he adds: "We would prefer to do it this way." The labor turmoil at Saturn in part dates back to the mid-1990s, when GM went through a massive operational restructuring, shutting down 21 plants. Many of the laid-off workers ended up at Saturn, which was in the process of expanding production and needed workers. Unlike the first wave of volunteers when Saturn began building cars in 1990, the later hires were mostly workers who needed a job and came to Tennessee without necessarily committing to the Saturn way. UAW members had to give up all their seniority and their right to return to GM when they came to Saturn, which is not a GM division but is actually a separate company. As a result, many former GM workers with 20 or more years of seniority began work at Saturn at the bottom of the seniority totem pole, behind workers with just one or two years' experience at the company. Approximately one-third of Saturn's current employees came in the second wave, according to Michael Bennett, the former president of UAW Local 1853 and now the union's manufacturing adviser at Saturn. Bennett is considered the union father of the labor agreement with Saturn and the keeper of the flame of cooperation with the company. If the Saturn agreement is voted down, Bennett said, "the nation would lose a very credible model." He blames the new arrivals for changing the character of the work force. Bennett sees "a real grass-roots movement growing over the direction labor takes." "Many in labor believe we should leave managing the business to management," he said. Joseph Ripkowski, president of Local 1853, attributes the referendum vote on the Saturn contract to "the fear of the unknown." Ripkowski predicts the proposal to return to the GM national agreement will be defeated by a 70 percent majority. "I don't expect to see the membership turn this place upside down," he said. Partnerships can't end the inherent tensions in labor-management relations, said Bruce Raynor, secretary-treasurer of Unite, the Union of Needle and Industrial Trades Employees, which represents workers at both Levi Strauss and Xerox. "Of course there are strains," Raynor said. "The difference is the way that the pressures are dealt with." Levi Strauss and Unite had some "heated discussions" about the company's plans to close a number of operations, Raynor said. "We didn't like the closings, but because of the partnership we were involved from the beginning and at the end of the day we came to accept the economic reality that there was going to be a plant closing." At Xerox there have also been strains, according to Raynor, but the partnership program continues because both sides are able to work together to help solve their problems. "Corporations have a real hard time doing this for a long time," Raynor said. "But for a smart corporation it's the way to go. With all the economic pressures on companies from the outside, why should they go to war with their employees?" Partnership tensions also erupted at Magma Copper in Arizona, after it was acquired by a hard-nosed Australian concern. MIT's Kochan said the new owners have made it clear they are "in no mood to continue" what they see as an impediment to profitability in the face of a worldwide slump in copper prices. Nancy Mills, director of the AFL-CIO's Center for Workplace Democracy, acknowledges that the momentum for cooperative programs has slowed down, but she predicts labor-management relations will never return to the old days, when workers were asked to check their brains at the door. "I think what we're finding is that the experimentation program is going through a very natural adjustment process," Mills said. One of the problems, she said, is that most of the experiments are limited to individual employers and not whole industries. When dips in the economy occur, all the stress is on that particular employer and its local labor union, making it hard to sustain the cooperative effort. Whatever happens in this week's vote at Saturn, Hopp believes he has already made his point that labor-management partnership is no panacea. "Regardless of the vote on this," he said, "I say we've already won. People are examining the little gray book and asking questions." Saturn's Slump Saturn's sales dropped nearly 10 percent last year -- further than most cars in its category. Percent change in sales, 1996-1997 Kia Sephia 34.6% Chevrolet Cavalier 9.0% Pontiac Sunfire 6.7% Hyundai Elantra 3.8% Mitsubishi Mirage 1.2% Ford Escort -- 0.3% Mercury Tracer -- 8.8% Mazda Protege -- 9.6% Saturn -- 9.9% Dodge/Plymouth Neon -- 17.7% Geo Prizm 20.6% Hyundai Accent/Excel -- 24.2% SOURCE: J.D. Power and Associates © Copyright 1998 The Washington Post Company ======================================== Out of service: The careers of Fresno operators get disconnected by technology By Doug Hoagland The Fresno Bee (Published March 8, 1998) Technology killed Georgia Johnston's job at Ma Bell. She was a telephone operator for 29 years, making $32,000 annually with a high school education - really good money. Then some engineer's new, hot software fried her career. The end came Saturday. Not unexpectedly. Not without a good severance package. Not without some remembering, some complaining and bitterness, and even some laughter. But the job still ended. Johnston and 109 other long-distance operators at AT&T's Fresno center no longer are in service. And no, this is not a recording. Voice-recognition technology now enables AT&T computers to "hear" and do for customers what operators always have done. Place person-to-person calls. Bill a third party. Credit a bill for a misdialed number. The displaced Fresno operators have three options: retrain for a job outside AT&T, relocate to another AT&T operator center or retire. "You feel like life choices are being made for you," says Johnston, a 48-year-old single mother with an easy smile and a teen-age son who keeps needing bigger and more expensive tennis shoes. "It's real hard because this wasn't just a job," Johnston says. "It became a career that paid good money. How am I going to go out and replace that?" Yet Johnson isn't exactly getting tossed into the El Nino-soaked streets. She's taking an extended severance package negotiated by AT&T and her union, Communications Workers of America. It pays her salary for nearly two years. During that time, she'll take classes paid for by the federal government. Her goal: get into labor management and continue her union activism. People hear stories like this and start worrying about those uppermost on their minds: themselves. Will technology zap their jobs before they can bail out? "This issue has occupied the soul of man for a long time, and as we move from the industrial state to the technological state, it will continue to," says labor economist Patrick Valentine at American University in Washington, D.C. He adds: "The mood of people out there is one of incredible uncertainty." He has that right. Each year for the last several, Johnston and her colleagues worked up a good, prickly sweat as AT&T announced the closing of operator centers. Each year, the Fresno center dodged the shutdown. Then '98 came. Suddenly, Johnston could qualify as an expert on what technology can do for you, and to you. "You invest your life in a job, and this is not how you planned on it ending," she says. "I can't say AT&T has been bad to us. But I don't think they've been - what's the word? - protective." Kathi Oram, spokeswoman for AT&T in San Francisco, says she's sympathetic. "But the way the labor market is going, there's no such thing as lifetime employment. They need to be taking control of their careers and really looking at what education they need for the future." An American tradition Technology bumping off workers is a good, old American tradition. Telecommunications shook with another big, techno change in '98 - 1898, that is. The electromagnetic switch "revolutionized" the fledgling telephone industry. Workers who manually connected lines no longer were needed, says American University's Valentine. In the 1990s, another new technology - voice recognition - sent people packing. It was introduced in 1993, when AT&T had 18,000 operators. Today, the number is 7,000. Voice recognition works when AT&T customers dial 00 to access long-distance service and a mechanized voice offers calling options. Customers state an option, and a computer responds. It can because of "word spotting," a feature enabling the computer to recognize key words and act on what it hears. "This has saved us hundreds of millions of dollars," says AT&T spokesman Mark Siegel in Basking Ridge, N.J.. The exact amount? Siegel won't say. Competitors Sprint or MCI might be eavesdropping. AT&T says competition for long-distance business has sparked technological changes. You want to keep your customers, or attract new ones? You give them what they want. And, says Siegel, "We've seen it over and over again. People prefer to put calls through themselves. They want to talk to an operator if they have a question or problem, but they're saying: 'Don't force me to talk to one.'" Expect to see more of this. Robert Wilkes, a telecommunications stock analyst with Brown Brothers Harriman bank in New York, says AT&T and MCI continue to look for cost-cutting ways to serve residential customers. Computers replacing operators is one way to do that, Wilkes says. Technology-driven downsizing also might speed up as MCI is bought out by WorldCom Inc., a deal announced in November and awaiting approval from Washington. MCI is the nation's second-largest long-distance carrier behind AT&T. Downright distrust greets this news in some quarters. Nadine Cox is president of Communications Workers of America, local 9408 in Fresno. She's says the operators' union has done surveys that show telephone customers don't like talking to mechanical voices. Cox dismisses as a smoke screen AT&T's talk of people demanding new technology. Ma Bell is cutting operators to save salaries, not better serve customers, Cox says, unhappily. An ultimatum In spring of 1968, Georgia Johnston also was unhappy. She was a year out of Hoover High School and going nowhere. Her father laid down an ultimatum: "Find a job, or I'm putting you in the Army." Johnston decided to be all she could be as a telephone operator. She quickly realized her good fortune. "In those days, if you didn't work for PG&E or the telephone company, you didn't have a job for life," says Johnston, laughing at how hollow those words sound today. She started at $73.50 a week. Johnston reminisces about this in a near-deserted lunchroom at AT&T's Fresno center, a white, boxy building near the airport. It is mid-morning on a Monday holiday, a few weeks before the office shuts down. Johnston sits there in beige pants, white sweater and look-at-me orange socks. She rests one leg on the seat of an empty chair. Johnston started her career on a stool, sitting in front of an old-fashioned switchboard. The job required a human hand to pull a cord with a bulletlike head, plug it into a quarter-inch hole marked with some distant city's name and dial the number. The old switchboards had stamp clocks and stacks of slender billing forms. To figure charges on long-distance calls, operators were supposed to punch starting and stopping times on the billing cards. But sometimes they forgot, and then a laughing voice would ring out: "Oops. Anyone know how long that call was for?" (Today, a computer counts to the second and rounds if off to the next minute.) There were other moments of silliness and fun. Operators at Christmastime would get creative with their holiday greeting and wish customers "Happy Holly Balls." They also would prop up a hung-over colleague on her stool after a wet-and-wild Saturday night. So much was different 30 years ago. Operators still had to dial some long-distance calls - direct dial wasn't universal. Operators also handled collect calls. People dialed 0 in emergencies. (This was pre-911.) People thinking suicide called, too. So did children who came home to an empty house and were afraid. Those calls could sizzle with stress. Operators would call the police and counsel the troubled and then slip off their stools for a splash of cold water. Today, the work is so much more mechanical. On the Monday holiday, operators sit on swivel chairs in cubicles at the Fresno center. Their eyes dance around their computer screens. Most are women. They quietly speak into headsets. Their voices are polite, modulated, professional. Their faces run to middle age: made up by time, experience and Maybelline. A large sign tacked up on a wall bids these operators "GOOD BYE. GOOD LUCK." At one workstation, a beep sounds in an operator's headset, signaling an incoming call. It's from across the Atlantic. The country's name comes up on the computer screen. Turkey. Ten time zones away, someone needs help with a call to America. A computer distributed the call to the next-available operator. It could have gone to any number of cities: Phoenix; Reno, Nev.; Ennis, Texas; and until Saturday, Fresno. What will the future hold? With the Fresno center now closed, Johnston and other operators had to pick a future. Fresno Works, a partnership of job and educational organizations, is offering counseling and will pay for up to nine months of training for a new job. AT&T hired operators willing to relocate to out-of-state centers. Fresno was the last one on the West Coast. Out of 110 operators, 20 are relocating. AT&T also set up job hot lines to help connect outside companies with its employees. (One additional bonus: the company has paid some college tuition for employees since 1985.) The Communications Workers of America negotiated a severance package that includes up to 102 weeks of full pay, depending on how many years with the company. Workers will get the checks biweekly. Johnston is entitled to 96 weeks and will use that time to hit 30 years of service, which allows her to retire with full benefits. With 30 years, that amounts to $950 a month. She is one of 60 operators taking the extended severance package. The others are either quitting (with a lump-sum severance check), retiring or "bumping" operators with less seniority at other centers. Many of them are leaving before they thought they would. Georgia Johnston never envisioned this kind of future when she was a young operator. Or maybe she did. She once wrote a short story inspired by the other-world reality of "The Twilight Zone." In her story, only one operator is left in the world. She sits in a darkened room before a bank of green computer screens. Each screen glows mysteriously to life as her swivel chair turns in its direction. "All she has to do is hit a button, and she places calls all over the world," Johnston says, silence closing around her in the now-empty AT&T lunchroom. "Just think about it. That's the way it's become. At the touch of a finger, you and I can have all the world." But not always a job. Copyright © The Fresno Bee
