For years, Lee F. Conrad was a lonely guy. Sometimes, the only employees he could lure to meetings about unionizing IBM's Endicott (N.Y.) plant were a few buddies. Even in the midst of massive layoffs and corporate downsizing during the early 1990s, Conrad and organizers at other IBM plants couldn't drum up enough supporters to call for a union vote. After a while, he gave up. "I was semiretired from all this," he says.
That was before IBM Chairman Louis V. Gerstner Jr. started mucking around with pension plans. Now, Big Blue is facing the first serious threat in years that the company's 140,000 U.S. workers could be unionized. The Communication Workers of America (CWA) are rallying angry veteran employees from Burlington, Vt., to Austin, Tex., to San Jose, Calif., who feel betrayed by IBM's recent efforts to overhaul the pension plan in ways that in effect would cut their benefits. Workers claim, in fact, that benefits for most midcareer workers would have been cut by as much as 40%.
Gerstner is trying to avoid a showdown with workers. On Sept. 17, IBM modified its controversial plan, doubling the number of workers eligible to stay in the old pension system to 65,000 out of 140,000. But some workers feel Big Blue didn't go far enough. "They need to offer the choice to everybody," says Conrad. "When they try to throw a bone out, it just doesn't work."
IBM insists it must go forward with the overhaul if it is to stay competitive in an industry where three out of four rivals skip the expense of pensions or simply offer less costly plans such as 401(k)s. The changes, IBM says, would allow it to increase other types of compensation, such as stock options. But options, too, are a sore subject: In 1999, only 25,000 of IBM's 290,000 global workforce will be offered options. That's 9% of the workforce, vs. 15% at other high-tech companies.
"ONLY SOLUTION." Meanwhile, IBM is cutting back some health benefits and overtime pay. Employees also complain about the increasing number of temporary workers and how some full-timers are not getting raises, even after rave performance reviews. "I have always been against unions," says Calvin Aranson, a 25-year employee at IBM's Global Services unit in Portland, Ore. "Like a lot of IBM employees, I have come to the conclusion that, when dealing with IBM, a union is the only solution."
So the CWA is rolling out a nationwide organizing plan similar to intensive campaigns it has launched for blue-collar workers at AT&T and the Baby Bells. Whereas CWA organizers in the past have concentrated on only a few IBM facilities, CWA organizer Jeff Lacher says this time the union already has worker committees set up and running at 10 locations all over the country. The union also is claiming thousands of new recruits who have signed petitions calling for a union vote. They refuse, however, to disclose specific numbers. But given past difficulties of organizing IBM, Lacher says the CWA plans to wait for at least a 60% show of support at any facility before demanding an election, even though federal law requires a union to garner only 30%.
IBM insists the union activity is not widespread. The company, which did not make an executive available, claimed through a spokeswoman that most workers do not want a union and that its employees receive competitive salaries. Meanwhile, Gerstner is taking the heat. When the CEO visited Austin this summer, a plane flew overhead dragging a banner: "IBM Stole My Pension." Web sites and chat groups have popped up filled with vitriol against IBM and its managers. There are even a couple of union songs: "We gave him 10, 20 years of our lives and what have we got to show? Louie and his corporate hacks took off with all our dough." If Gerstner doesn't want that tune to catch on, he has to do a better job of convincing his workforce that he really is willing to share the wealth.