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USW refuses Harley plan for 2-tier wage system



Published: Tue, October 17, 2006 @ 12:00 a.m.



Harley-Davidson said it will build elsewhere after the union vote.

MILWAUKEE (AP) -- A union has rejected Harley-Davidson Inc.'s request for lower wages for new hires and reduced benefits in exchange for expanding facilities in the company's home state of Wisconsin.

The United Steel Workers Local 2-209 rejected the proposal Monday, the motorcycle maker said. The vote does not put jobs in Milwaukee in jeopardy, but it does mean Harley will be looking to expand elsewhere, a company official said.

Messages left for union leaders were not immediately returned Monday.

But union president James Wheiland told the Milwaukee Journal-Sentinel that more than two-thirds of the union's 1,500 members voted against the proposal, which would have lowered wages for new hires by as much as one-third and reduced health and pension benefits for all workers.

In return for the cuts, Harley had promised a 120 million expansion in Milwaukee of larger motorcycle engines and transmissions.

Expansion needed

The expansion is needed to secure the company's future, said Rod Copes, vice president and general manager of the company's Pilgrim Road Powertrain Operations in Menomonee Falls.

"The proposal the union voted on would have made expansion here comparable to what we can achieve in a new unionized plant in some other part of the U.S.," Copes said.

Harley said it now plans to work with unions to expand elsewhere. It employs about 4,500 people in the Milwaukee area.

The company said last week that another quarter of surging international sales had pushed its third-quarter profit up 18 percent to 312.7 million. Revenue climbed 14 percent to 1.64 billion from 1.43 billion last year.




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