Deere, UAW begin contract talks

With ceremonial handshakes, representatives of Deere & Co. and the United Auto Workers union began negotiations Tuesday on a new six-year labor agreement.

The existing contract, ratified in October 2009, covers approximately 10,000 manufacturing employees at 12 Deere facilities. The agreement expires at midnight Sept. 30.

The new contact would cover 11 UAW local unions and approximately 11,200 UAW members at Deere manufacturing facilities.

In Iowa, the Deere operations include Davenport Works, Des Moines Works, Dubuque Works, Ottumwa Works and Waterloo Works, as well as three others in Waterloo - tractor and cab assembly, engine works and the foundry.

The contract talks come at a time when Deere is experiencing declining sales of farm equipment due to sharply lower prices paid to farmers for corn and soybeans, and hundreds of UAW members have been laid off.

The uncertainty caused by the faltering Chinese economy only makes negotiations harder for the union, according to University of Illinois at Chicago School of Labor and Employment Issues professor Bob Bruno.

'Some things are just out of your control,” Bruno said of the tough hand dealt to UAW negotiators. 'Clearly this is a tough context, but it makes it hard for both sides.”

In a news release, UAW President Dennis Williams acknowledged Deere and UAW members have gone through some tough times in the past year.

'But we know from history that these times are cyclical,” Williams said. 'And we know from history that the key to a good contract is one in which UAW members prosper, John Deere prospers and customers prosper with our products.”

According to Bruno, the union has a 'pretty good” relationship with Deere, and is pushing hard to end a two-tier wage system under which new hires are paid less than long-standing employees, but Deere's desire for flexibility will only increase given the current uncertainty about where the economy is heading.

'You make decisions now, but you're doing it based on your estimates of where you're going to be,” he said. 'When things are volatile, that can make it pretty challenging.”

Both sides will have to work extra hard to develop a shared interpretation of the economic data, he added.

Deere said it has agreed with the UAW to make no further public comment during negotiations except through news releases distributed by the organizations.

The Chicago Tribune contributed to this report.