Tower Automotive reaches tentative agreement with unions at closing Milwaukee plant

By Caroline Salls

Pittsburgh, Feb. 27 - Tower Automotive Inc. reached a tentative agreement with seven unions at its Milwaukee manufacturing facility that will cease operations in March and the company plans to move forward with bargaining for the closure of its Greenville, Mich., manufacturing facility, according to a company news release.

Tower has reached an agreement in principle with the seven unions that represent workers at its Milwaukee manufacturing facility, one of its largest collective bargaining units and its largest group of retirees.

The tentative agreement modifies benefits and resolves a wide range of outstanding issues related to the planned cessation of operations at the facility in March.

The agreement modifies retiree health care benefits for current and retired Milwaukee employees.

To mitigate the effects of terminating retiree health coverage, Tower Automotive will continue to pay health care coverage for employees through the end of June and will assist with the establishment of a Voluntary Employee Beneficiary Association trust that will administer the health care benefits of retirees and their dependents.

Under this agreement, additional company contributions are possible if the company meets certain financial targets.

"This agreement, which is the result of hard bargaining and tough discussions, enables Tower to address approximately 85% of its post-retirement medical liability and achieve the savings we need from this group while also addressing a variety of issues important to the unions and their members," president and chief executive officer Kathleen Ligocki said in the release.

The seven Milwaukee unions are Smith Steel Workers, DALU 19806 AFL-CIO; District 10 International Association of Machinists and Aerospace Workers; International Brotherhood of Electrical Workers - Local 663; Technical Engineers Association; Service Employees International Union, Local 150; United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry of the United States and Canada, Local Union 601 and Milwaukee and Southeast Wisconsin Regional Council of Carpenters.

The agreement is subject to union member ratification and bankruptcy court approval.

Tower Automotive also announced that its board of directors has authorized any necessary bargaining regarding the closure of the manufacturing facility in Greenville, Mich.

The facility, which produces metal stampings and assemblies for the North American automotive industry, employs about 200 hourly employees and 30 salaried employees.

The Novi, Mich.-based auto parts maker filed for bankruptcy on Feb. 1, 2005 in the U.S. Bankruptcy Court for the Southern District of New York. Its Chapter 11 case number is 05-10578.

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