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November 4, 2019 11:15 AM, EST

Mack Trucks Union Workers Approve Labor Agreement

Mack Trucks Mack Trucks in a lot. (Joe Howard/Transport Topics)

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Now, the deal is official.

Mack Trucks announced late on Nov. 3 that United Auto Workers members ratified a four-year collective bargaining agreement with the company. The contract covers more than 3,500 Mack workers across six facilities in Pennsylvania, Maryland and Florida.

Members of UAW Local 677, which represents workers in Allentown, Lower Macungie Township and Middletown, Dauphin County, voted on the contract from 4 p.m. to 7 p.m. Nov. 3 in the Allen High School gymnasium. The union, on its website the morning of Nov. 4, confirmed that members ratified all local and master agreements but did not disclose vote totals, promising more details would follow.

The new contract will expire at 11:59 p.m. Oct. 1, 2023. Members will receive a $3,500 bonus now that the deal is ratified.

The two sides reached a tentative agreement Oct. 24, which ended a 12-day strike that lasted longer than the last labor dispute to hit Mack in 1984. Before a strike was declared, Mack and the UAW had tried unsuccessfully to iron out a new contract more than 10 days after the previous three-year labor deal expired Oct. 1.

Local union officials said the dispute with the company boiled down to job security, along with some concerns over health benefits.

On the latter issue, the new contract keeps the same health care premiums for four years. Local union officials also said the agreement secures job security by retaining a letter in the contract that protects the existing production at the Lower Macungie assembly plant, which assembles Class 8 highway, construction and garbage trucks for the North American market. That means Mack can’t shift the plant’s existing work for the length of the contract.

However, according to contract highlights posted online Nov. 1, “new plant language” was deleted from Letter 6 in the contract. Letter 6 hindered the company from building another plant in North America.

Mack does, in fact, appear to have a plan to produce medium-duty trucks in Virginia. That project, which Mack and its parent company, Sweden-based Volvo Group, have declined to discuss, would represent a new truck for Mack rather than something that would result in a shift of production from Lower Macungie.

The contract also comes with pay increases for union members over four years. With the deal ratified, members are scheduled to get a 3% wage increase in the first year. The following three years will each come with a 1% wage bump, with a $1,000 bonus in the third year.

“The new agreement allows us to continue providing our UAW-represented employees and their families with an attractive package of wages and benefits, while safeguarding the company’s competitiveness and supporting the success of our customers,” Mack President Martin Weissburg said in a release late Nov. 3.

In a letter Oct. 31 to members, UAW Secretary-Treasurer Ray Curry called the 2019 negotiations “very challenging,” but said the union stayed committed to its membership’s best interest and demands.

“This has been a long process,” said Curry, also director of the UAW Heavy Truck Department, “but we respect the process and this agreement shows that the process works.”

Now back at work — the Lower Macungie plant, for one, resumed full production Oct. 31 — Mack employees are returning to a heavy-duty truck market that is softening after two years of strong demand.

As the market comes down, however, the mix could actually be favorable to what Mack does best, Volvo Group President and CEO Martin Lundstedt said on an earnings call Oct. 18.

His reasoning: While Mack is making gains in the longhaul segment with its Anthem model, unveiled in September 2017, the brand still has a smaller market share than competitors. But where Mack has long excelled is in “vocational trucks,” or the work trucks used on construction sites or picking up garbage.

In addition to UAW Local 677, the other local unions involved were: UAW Local 171 and 1247 in Hagerstown, Md.; UAW Local 2301 in Baltimore; and Local 2420 in Jacksonville, Fla.

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