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Saint-Gobain: no role for general directorate in Abrasives dispute

Compagnie de Saint-Gobain chairman Jean-Louis Beffa, rejected calls for him to intervene in negotiations between the United Auto Workers and Saint-Gobain Abrasives Inc. in Worcester, Massachusetts.
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Compagnie de Saint-Gobain chairman Jean-Louis Beffa, rejected calls for him to intervene in negotiations between the United Auto Workers and Saint-Gobain Abrasives Inc. in Worcester, Massachusetts. Mr. Beffa made his response to a union official during the Saint-Gobain AGM on 5 June 2003 in Paris. Furthermore, he said, the plant has high wage costs, and an “unreasonable compromise” in contract talks could put its future at risk. Mr. Beffa, responding to a plea from United Auto Workers official Robert L. Madore through a French interpreter on the meeting floor, said Saint-Gobain“s policy is for labor contracts to be negotiated at local level. “We trust top management in Worcester to take care of this situation. We have made proposals, compromises must be made and they must be reasonable.” Three UAW organisers who attended the AGM said they travelled to the meeting to alert shareholders and directors of the continuing dispute at the Massachusetts plant. They gained entry to the meeting with proxies given by Boston Common Asset Management LLC, an investment firm which promotes social change on behalf of its shareholder clients. The UAW represents 799 of 1,850 workers at the plant. Employees voted for union representation in August 2001 and contract negotiations commenced in February 2002. At least 76 sessions have been held since. Mr. Madore, UAW assistant regional director, warned Mr. Beffa that the failure to reach a contract after more than 70 sessions “is affecting the volume and quality of your production in Worcester” and that while Saint-Gobain has a good reputation as an employer in France, he said, “in Worcester it is the opposite.” Mr. Madore, who was recognized during a question-and-answer session, asked Mr. Beffa to intervene in the talks and encourage Worcester managers “to negotiate around the clock.” But Mr. Beffa told Mr. Madore that Saint-Gobain“s general directorate would not intervene in negotiations that were ongoing in the field, and he urged the UAW to make compromises in order to reach a deal. Also addressing shareholders were Ms. Knox, Mr. Quitadamo and James Catterson, a representative of the International Federation of Chemical, Energy and Mine Workers who spoke on behalf of Boston Common Asset Management. Mr. Catterson said Boston Common feared the labor dispute, which he said has included legal complaints against the company for antiunion actions, would hurt Saint-Gobain“s reputation and public image, thus harming long-term shareholder value. He urged a “speedy resolution to this crisis.” Mr. Beffa said the company “attached great importance to the issue,” but said it is being managed in a decentralized way. “We want to be in social dialogue and consider we are working honestly,” he said. “Nothing has been filed by the state against us. No one has said our behavior is not proper, legally speaking.” According to Mr. Beffa, Saint-Gobain has made progress with the union, but he pointed out that Worcester is a high-wage plant; the company has a responsibility to the workers there to maintain jobs and if there were “an unreasonable compromise, the future of the plant could be jeopardized.” He emphasised the company was not prepared to “sacrifice for a bad agreement”. “This is a first contract and every word has to be negotiated,” said Saint-Gobain spokeswoman Dorothy C. Wackerman. “It is not unusual for a first contract to take this long. They have met more than once or twice a week on average, and the work that needs to be done in between sessions is substantial. There are a lot of resources and effort going into this.” “Distractions” have helped prolong the process, including the union rallies and letter-writing campaigns, said Ms. Wackerman. A meeting scheduled for 1st week of June 2003 could not be held because union leaders were in Paris, she said. Meetings are already scheduled through July. Seventy-nine proposals have been tabled, with nearly 60% submitted by the company, she said. Compensation and benefits compare “very favorably with other manufacturing companies,” said Ms. Wackerman. But the environment for abrasives continues to be difficult, “and we need to make sure we remain competitive,” she said.

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