Bureau Of National Affairs

Wednesday, July 18, 2001




Food Processing


Smithfield Packing Contract With LIUNA For 1,800 in Virginia Approved by Members


Union-represented employees at the Smithfield Packing Co. plant in Smithfield, Va., will receive a combination of lump-sum payments and general wage increases under a new five-year contract approved July 14 by members of Local 1046 of the Laborers' International Union of North America.


Darrell Townsend, the local's business manager, said the new agreement, which covers some 1,800 production and maintenance workers and drivers, was approved by 89 percent of those eligible to cast ballots in the ratification vote.


The agreement is retroactive to July 1 when the prior contract expired. For production workers, who account for the bulk of the bargaining unit, there is a $1,100 immediate lump-sum payment. Subsequent annual wage increases over the next four years will total $1.11 per hour with payments all effective July 1, Townsend said. The average production pay rate in the plant under the prior contract was $9.79 per hour, he said.


For maintenance workers there is an initial hourly increase of between 12 cents and 90 cents depending on classification. Additionally, maintenance employees can earn up to $1.25 per hour more every six months over the next year and one half based on participating in certain training courses and demonstrating proficiency in the new skill. Under the prior agreement, maintenance rates ranged from $9.15 to $14.10 per hour. Through the enhanced training program, maintenance employees could go to a new top rate of $18.25 per hour in the next 18 months.


In the second and fourth years, there are $500 lump-sum payments for employees in maintenance jobs, and hourly increases of 25 cents in the third year and 30 cents in the fifth, Townsend said.


For the approximately 100 drivers who also are part of the bargaining unit the "trip rate" method for calculating pay is changed to a mileage system. Drivers remain on the same benefits schedule as production employees.


Benefit Changes


The new contract increases the lifetime major medical coverage from the prior $100,000 to $200,000 over the term of the agreement. The medical coverage remains the same, but employees will pay a larger weekly premium share beginning Nov. 6, 2001, Townsend said.


Single employees were paying $6.20 per week, which will increase by 60 cents to $6.80 per week this year and then by an additional 60 cents per week in each subsequent year of the contract. For an employee with one or two dependents, the premium share had been $8.60 per week and also will increase by 60 cents in each year of the contract. For an employee with three or more dependents, the prior premium cost was $12 per week and will go up by 60 cents each year, Townsend said.


The dental plan offered to the plant's supervisory personnel now is extended to bargaining unit employees for the first time.


The pension formula will increase under the new agreement, going from the current $11 per month per year of service to $17 per month as of Jan. 1. 2002. A 401(k) retirement savings plan also is offered for the first time. While the company will make no matching contribution, it will pay the administrative cost of the plan, Townsend said.


The short-term disability benefit, which had been $95 per week for 13 weeks, is increased to $110 per week with ratification and to $115 per week in fourth year of the contract.


Employees previously accrued sick leave on a half-day per month basis. Under the new contract, they will have the same five days available immediately at the beginning of each year.


The contract's funeral leave provision also is expanded to apply in the event of death of additional family members. .


Smithfield Packing's labor relations officials were not available to discuss the new agreement, which runs to June 30, 2006.


Copyright © 2001 by The Bureau of National Affairs, Inc., Washington D.C.

Return to Laborers.org

(c) All orginal work Copyright Laborers.org 1998. All rights reserved..