ON BEHALF OF THE CORPORATE UNION RELATIONS TEAM AND ALL OF GE, IT IS MY PLEASURE TO WELCOME YOU TO 2007 NATIONAL NEGOTIATIONS.

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1 General Electric National Negotiations Opening Remarks Bill Casey, Chief Negotiator, General Electric May 21, 2007 ON BEHALF OF THE CORPORATE UNION RELATIONS TEAM AND ALL OF GE, IT IS MY PLEASURE TO WELCOME YOU TO 2007 NATIONAL NEGOTIATIONS. THIS BEING MY FIRST AS CHIEF SPOKESPERSON, IT IS AN HONOR TO REPRESENT GE AT THIS TABLE, ONE COMPRISED OF COUNTLESS YEARS OF EXPERIENCE AND MUTUAL SUCCESS. TO PRESIDENTS COHEN AND CLARK, WELCOME. CHAIRMAN SANTAMOOR AND THE IUE CONFERENCE BOARD STAFF, I KNOW YOUR PASSION FOR THE CHALLENGES WE LL CONFRONT AND YOUR COMMITMENT TO YOUR CONSTITUENTS. YOUR REMARKS TODAY SPEAK THOUGHTFULLY AND PROVOCATIVELY TO THESE CHALLENGES AND THE EFFECT ON ALL THOSE WHO AWAIT THE OUTCOME. IT IS AGAINST AN ENVIABLE TRACK RECORD THAT WE, AND OUR RESPECTIVE TEAMS, WILL APPLY OUR EFFORTS, HOPEFULLY IN PURSUIT OF THE SAME RESULT. ALTHOUGH MANY OF US ARE IN NEW ROLES, WE ARE, IN LARGE PART, FAMILIAR FACES WITH A SHARED EXPERIENCE IN PAST NEGOTIATIONS. TRANSLATING THIS HISTORY INTO CONTINUED SUCCESS

2 WILL, IN MY ESTIMATION, REQUIRE THE BEST FROM ALL OF US. SUCH IS THE NATURE OF THIS PROCESS AND THE ISSUES WE LL DEBATE. I VE SPENT A FAIR AMOUNT OF TIME OVER THE PAST FOUR YEARS CONTEMPLATING THE RECIPE FOR OUR MUTUAL SUCCESS IN THIS DIFFICULT ARENA. I VE ANALYZED THE GIVES AND THE TAKES, THE BACKDROP OF ENVIRONMENT AND BUSINESS PERFORMANCE, THE PLAYERS AND THE PRINCIPLES. NONE OF THIS ANALYSIS HAS YIELDED THE SECRET SAUCE, AT LEAST NOT TO ME. BUT I JOIN YOU HERE TODAY CONVINCED OF SOMETHING I LEARNED IN MY FIRST LABOR ASSIGNMENT IN LYNN. MY TEACHER ON THIS PARTICULAR OCCASION WAS SOMEONE MANY OF YOU KNEW WELL, CHARLIE RUITER. AFTER A FEW RANCOROUS EARLY SKIRMISHES, CHARLIE EXPLAINED HIS THEORY OF KEEPING SCORE IN THIS TRADE. IN HIS VIEW, BEING SUCCESSFUL WAS NOT ABOUT WINNING, PER SE; IT WAS ABOUT RESOLVING ISSUES. I SPENT THE BETTER PART OF THE NEXT THREE YEARS LEARNING AND RELEARNING THE DIFFERENCE. I DON T, THEREFORE, COME HERE TO WIN THIS ROUND OF NEGOTIATIONS. TO DO SO WOULD LEAD, I M SURE, TO A MUTUAL LOSS AND THE END OF THAT ILLUSTRIOUS TRACK RECORD. 2

3 HAVING SAID THAT, I DON T PRETEND FOR A MINUTE THAT WE COME HERE AFTER FOUR YEARS WITH SIMILAR PERSPECTIVES ON MANY OF THE ISSUES. YOUR REMARKS TODAY HAVE DONE NOTHING TO DISSUADE ME OF THAT NOTION. A FEW WEEKS AGO I STAKED OUT SEVERAL VIEWS OF MY OWN IN THE TRADITIONAL GE CHIEF NEGOTIATOR INTERVIEW. TIME AND COURTESY FORBID ANOTHER DETAILED ACCOUNTING, BUT A FEW SUMMARY THOUGHTS ARE PERHAPS IN ORDER. I HAVE READ YOUR MANY PRONOUNCEMENTS ON THE ISSUES AND HEARD YOU TODAY. ONE THEME I HEAR REPEATEDLY SPEAKS TO THE NOTION OF WHAT GE CAN AFFORD TO GIVE OR NOT TAKE, AS THE CASE MAY BE, IN THIS ROUND OF BARGAINING. IT IS REPEATED THROUGHOUT THIS LITERATURE, WHETHER THE SUBJECT IS PENSIONS, WAGES, HEALTHCARE, PAID TIME OFF, OR ANY OTHER ECONOMIC MATTER WITHIN OUR PURVIEW, AND A FEW OUTSIDE OF IT. YOU KNOW OUR POSITION WELL; IT HASN T CHANGED OVER THE YEARS. THERE WILL BE A FAIR AMOUNT OF GIVING AND A CERTAIN AMOUNT OF TAKING, OF THAT I AM SURE. BUT NONE OF IT, IN MY VIEW, WILL BE CONDITIONED ON LAST QUARTER S OR LAST YEAR S RESULTS. 3

4 I HAVE ALSO EXAMINED ALL I COULD FIND ON YOUR SURVEY RESULTS IN HOPES OF DISCERNING YOUR REAL PRIORITIES. IT APPEARS THAT MANY THINGS ARE THE NUMBER ONE PRIORITY OF THE AMALGAMATION OF UNIONS AND LOCALS REPRESENTED HERE. I ACCEPT IT AS SO. WE LL CONDUCT OURSELVES ACCORDING TO THE PREMISE THAT ALL OF THESE MATTERS ARE OF VITAL IMPORTANCE TO SOMEONE. THE PROCESS WE USE HAS STOOD THE TEST OF TIME AND WE WILL STRIVE TO CREATE FROM THIS MIX OF INTERESTS AND ASPIRATIONS A JOB PACKAGE THAT WE CAN ALL ENDORSE. I WILL TOUCH BRIEFLY, HOWEVER, ON THE TRADITIONAL BIG-TICKET ITEMS IN THE HOPE OF CASTING THEM IN TODAY S LIGHT. WITH RESPECT TO HEALTHCARE AND HOW TO PAY FOR IT, OUR DIFFERENCES ARE STARK BUT CLEARLY UNDERSTOOD. WE STILL BELIEVE IN A COMPETITIVE LEVEL OF COST SHARING, COMPREHENSIVE COVERAGE AND REAL PROTECTION AGAINST CATASTROPHIC OCCURRENCES. I SUSPECT YOU HAVE LITTLE QUARREL WITH THE LATTER TWO. ON THE FIRST, WE LL REFRESH SOME OLD IDEAS AND ADVANCE A FEW NEW ONES, ALWAYS STRIVING FOR AN EQUITABLE RESPONSE TO AN ISSUE THAT DEMANDS OUR FULL ATTENTION AND BEST EFFORTS. 4

5 ONE OF THE REAL DIFFICULTIES WE FACE IN OUR ATTEMPTS TO ENLIGHTEN ONE ANOTHER IN THIS AREA IS THE SEARCH FOR PROPER CONTEXT. TO A CERTAIN EXTENT, YOU HAVE ESTABLISHED YOUR FRAME OF REFERENCE, OUR PROFITABILITY. FOR OUR PART, WE WILL EXAMINE THE COSTS, YOURS AND OURS, IN A COMPETITIVE LIGHT, BUT NOT WITHOUT A MEASURE OF INTERNAL EQUITY AS WELL. OUR DISCUSSIONS REGARDING JOB SECURITY WILL NO DOUBT RAISE THE VOLUME IN THIS ROOM. OUR PHILOSOPHIC DIFFERENCES ASIDE, I DON T ENVISION ANY WHOLESALE OVERHAUL OF THE VERY COMPREHENSIVE SET OF BENEFITS WE HAVE IN PLACE. YOU DO UNDERSTAND, HOWEVER, THAT WE HAVE A REAL CONCERN OVER THE ESCALATING COST OF THE SERO WINDOW PROVISION. I M SURE YOU WILL STRIVE TO ENLIGHTEN ME, BUT I CONFESS TO MY FAILURE TO UNDERSTAND THE CONNECTION BETWEEN THAT PROVISION AND ANY NOTION OF REAL AND LASTING EMPLOYMENT SECURITY. IT POTENTIALLY ADDS HUNDREDS OF MILLIONS OF DOLLARS IN COSTS TO BUSINESSES IN ORDER TO PROVIDE PERHAPS A FEW HUNDRED EMPLOYEES WITH A FULLY BENEFITED EARLY RETIREMENT, AND IT DOES SO WITH NO APPRECIABLE REDUCTION IN ONGOING COST TO OUR OPERATIONS. I APPRECIATE THAT WE BAKED THIS CAKE TOGETHER, BUT I QUESTION OUR ABILITY TO CONTINUE GORGING OURSELVES ON IT. IN THE END, YOU WILL DECIDE WHAT YOU CAN LIVE WITH AND WITHOUT. 5

6 I KNOW A FEW ARE LOCKED IN ON THIS ISSUE AND IT TROUBLES ME. BY DEFINITION, WHEN YOU PAINT YOURSELF INTO A CORNER, THE PATHWAYS OUT CAN BE FEW AND FAR BETWEEN. PENSIONS, ON THE OTHER HAND, DO NOT SEEM AT FIRST BLUSH TO BE AN AREA WHERE WE WILL NEED TO BRIDGE A PHILOSOPHICAL GULF, STEM THE RISING TIDE, OR BREAK NEW GROUND. DESPITE THAT, THIS SUBJECT SEEMS TO INSPIRE AS MUCH RHETORIC AS ANY OTHER, WITH THE INEVITABLE REFERENCES TO FUNDING STATUS AND THE TIME SINCE GE S LAST CONTRIBUTION. LET ME ATTEMPT TO CAST A LITTLE NEW LIGHT ON THE MATTER. SINCE THE BEGINNING OF THE FUND IN 1945, GE HAS CONTRIBUTED $ 7.4 BILLION. ALL OF THE PARTICIPANTS SINCE THAT DATE HAVE COLLECTIVELY CONTRIBUTED $ 3.6 BILLION, A LITTLE LESS THAN HALF AS MUCH AS GE. PAYOUTS TO RETIREES AND BENEFICIARIES HAVE TOTALED A LITTLE OVER $37 BILLION. NOW IMAGINE THAT ALL OF THAT MONEY WAS INVESTED IN US GOVERNMENT BONDS, A GENERALLY RISK-FREE APPROACH. WE WOULD THEN BE GATHERING HERE TODAY WITH A FUND DEFICIT. THE PLAN WOULD BE UNDER WATER. SO FOR ALL THE TALK ABOUT WHO HAS PUT IN 6

7 WHAT AND WHEN, IT IS REALLY THE FUND MANAGERS WE BOTH HAVE TO THANK. IF WE DO OUR JOBS HERE HALF AS WELL, WE WILL EMERGE WITH IMPROVEMENTS THAT BENEFIT ALL AND STILL MEET THE FUNDAMENTAL OBJECTIVES OF THE PLAN. IN A SIMILAR VEIN, I DON T BELIEVE ANY SIGNIFICANT REDESIGN OF OUR APPROACH TO WAGES IS CALLED FOR OR WILL BE DEMANDED. AND I WON T BELABOR THE POINTS MADE IN MY INTERVIEW CONCERNING THE TOP 100 EARNERS. THOSE NUMBERS SPEAK FOR THEMSELVES, QUITE LOUDLY IN FACT. HOW MUCH WE TWEAK THE VARIOUS ELEMENTS OF WAGES REMAINS TO BE SEEN, BUT I FULLY EXPECT YOU WILL BE SATISFIED WITH THE END RESULT. LASTLY, I LL TOUCH ON A SUBJECT OF SOME CONFUSION AND A BIT OF CONSTERNATION AS WELL; THE SET OF BENEFITS DESIGNED FOR NEW HIRES IN WE NOW HAVE OVER 25,000 EMPLOYEES IN THE US WHO JOINED THE COMPANY WITH THIS SET OF BENEFITS. THEY ENJOY BOTH A DEFINED BENEFIT PENSION PLAN AND A SAVINGS AND SECURITY PLAN WITH AN ENHANCED COMPANY MATCH. THIS GROUP OF RECENT HIRES INCLUDES SOME OF THE VERY BEST AND BRIGHTEST WE COULD RECRUIT FROM FIRST-RATE COLLEGES AND UNIVERSITIES, AND OTHER FORTUNE 100 COMPANIES ACROSS THE COUNTRY. I SUSPECT MANY, IF NOT MOST 7

8 OF THEM HAD OTHER OPPORTUNITIES, BUT CHOSE US. WHO KNOWS, PERHAPS THE NEXT CEO OF THIS COMPANY IS AMONG THEM. THE BENEFIT DESIGN FOR THIS NEXT GENERATION OF EMPLOYEES IS HIGHLY COMPETITIVE. MANY COMPANIES HAVE FACED INTO THE REALITIES OF LONGER LIFE EXPECTANCY AND RAMPANT HEALTHCARE INFLATION, INCLUDING A FEW YOU DO BUSINESS WITH. OURS WAS A CAREFULLY MEASURED RESPONSE TO THESE PRESSURES, ONE THAT WILL PROVIDE REAL VALUE FOR EMPLOYEES GOING FORWARD AND ENSURE THAT OUR BUSINESSES REMAIN COMPETITIVE. IGNORING THESE TRENDS IS A RECIPE FOR OUR MUTUAL DISASTER. TENS OF THOUSANDS OF JOBS HAVE BEEN LOST IN THE WAKE OF GETTING THIS WRONG. WE INTEND TO BE AROUND FOR ANOTHER 100 YEARS AND LOOK FORWARD TO YOU BEING THERE WITH US. SO WE HAVE PLENTY TO CHEW ON. WITH RESPECT TO THE TOTAL JOB PACKAGE I WILL FINISH WITH A PERSONAL OBSERVATION. I VE BEEN WITH GE MY ENTIRE WORKING LIFE 39 PLUS YEARS. MOST OF THAT TIME HAS BEEN SPENT IN FACTORIES ACROSS MANY STATES AND GE BUSINESSES. IN ALL THAT TIME I HAVE MET THOUSANDS OF PRODUCTION EMPLOYEES. BUT I HAVE NEVER MET ONE WHO LEFT GE FOR A BETTER SET OF BENEFITS ELSEWHERE. NOT ONE. PERHAPS YOU HAVE, PERHAPS NOT. 8

9 I ATTRIBUTE THAT TO TWO THINGS. IT IS A TESTAMENT TO YOUR BARGAINING EXPERTISE, YOUR CREATIVITY AND SURELY YOUR RESOLVE. BUT IT IS ALSO A RESULT OF GE S WILLINGNESS TO LISTEN AND ADJUST APPROPRIATELY. I KNOW YOU HAVE PUT GREAT EFFORT INTO YOUR PREPARATION AND COME HERE UNIFIED AND COMMITTED. IN THE END, I EXPECT WE LL FASHION A TOTAL PACKAGE THAT MEETS THE NEEDS OF ALL OF US. IT IS MY SINCERE DESIRE TO SHAKE YOUR HANDS AGAIN ON FATHER S DAY, SECURE IN THE KNOWLEDGE THAT WE HAVE DONE OUR JOBS WELL