Ten thousand workers at manufacturer John Deere ended one of the largest U.S. private-sector strikes in years when they voted Wednesday to accept a new contract and return to work.
The six-year agreement between Deere and the United Auto Workers union offers an immediate 10% raise, two subsequent raises of 5%, cost-of-living adjustments to defray inflation and an $8,500 ratification bonus for each worker, among other provisions. The workers also successfully kept at bay a company proposal to eliminate defined-benefit pension plans for new hires.
Aside from tweaks to the company’s pay incentive plan, the deal was not substantially different than a recent offer from Deere that workers rejected in early November. But it appears to be far better than the original tentative deal between Deere and the UAW that led to the strike. That initial agreement, which included immediate raises of just 5% or 6%, was rejected by 90% of the membership in early October.
This time around, 61% of members voted in favor of ratifying the third tentative deal, versus 39% voting against, the UAW said Wednesday.
UAW President Ray Curry called it a “landmark agreement” reached after more than four weeks on strike.
“UAW John Deere members did not just unite themselves, they seemed to unite the nation in a struggle for fairness in the workplace,” Curry said in a statement. We could not be more proud of these UAW members and their families.”
Deere CEO John May said in a statement that the new deal signaled a “brighter future” for the company.
“John Deere’s success depends on the success of our people,” May said. “We’re giving employees the opportunity to earn wages and benefits that are the best in our industries and are groundbreaking in many ways.”
The strike that began Oct. 14 was the first to hit Deere since 1986. It affected 14 facilities around the country, though the bulk of the workforce is clustered around the Quad Cities area of Iowa and Illinois.
The workers’ overwhelming rejection of the original tentative agreement was a rebuke not just to the company but to the union as well, since UAW leadership had endorsed the proposal. Workers sent the union back to the bargaining table to secure a better deal.
The work stoppage was perhaps the most visible example yet of how workers are flexing their muscles amid a surprisingly tight labor market in this stage of the coronavirus pandemic. Workers felt confident going on strike knowing Deere would have a difficult time replacing them and maintaining production.
They also knew a prolonged strike would hurt Deere at a highly profitable time. The company has enjoyed a boom in sales due to high agricultural commodity prices and strong demand for farm and construction equipment. The company needed only three recent quarters to set a new record for annual profits.