Northrop Grumman Unions to Vote On New Three-Year Contract

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PASCAGOULA, Miss., April 3, 2007 (PRIME NEWSWIRE) -- A new three-year contract will be voted on tomorrow by all 14 unions representing workers at Northrop Grumman Corporation's (NYSE:NOC) Ingalls operations headquartered in Pascagoula. The unions represent more than 6,500 workers.

"This contract provides a very fair financial offer that comprises a competitive wage and benefits package," said Philip Teel, president of Northrop Grumman Ship Systems sector. "This proposal meets current and future employees' needs based on the current and potential economics of the Gulf Coast region while staying within a cost structure that is in line with our customer and shareholder requirements."

"The tentative agreement reflects changes made in response to employee concerns, as expressed in their votes on those previous proposals," said Mike Crawley, president of the Pascagoula Metal Trades Council.

"This proposed new three-year agreement includes increases in hourly wage rates for all represented employees, as well as other wage earning opportunities. Additionally, it enables the unions and the company to partner more closely in addressing vital, major issues facing the company, the unions and employees in the areas of attendance, attrition and performance/ productivity."

The unions voting on this contract include 11 affiliates of the Pascagoula Metal Trades Council (PMTC), the International Brotherhood of Electrical Workers (IBEW) Local No. 733, 29/33 Machinists, and the Security Guards Local No. 1, representing the West Bank Guards.

In addition to the benefits outlined below, this new proposal includes additional potential earnings in attendance bonuses, performance bonuses and a cost of living (COLA) allowance in the second and third years, which will be paid as a lump sum on all earnings in the previous year, and will be paid in the first pay period of February 2009 and 2010. The COLA will be based on changes in the Consumer Price Index for Urban wage earners in the South (CPW-W South), as calculated and published by the U.S. Bureau of Labor Statistics, which measures the average change in prices paid in the region for goods and services.

This new proposal provides many benefits over previous contracts and proposals. Some of these benefits are included in the table below:



                          Contract Highlights

              Industry Avg     Old Contract         New Contract
              ------------     ------------         ------------
   Wages
 (Annually)        $38,230          $38,106                $43,888
 ---------------------------------------------------------------------
  Wages
 (Hourly)           $18.38           $18.32        1st yr - $20.00**
                                                   2nd yr - $20.55
                                                   3rd yr - $21.10
                                            15.2% Cumulative increase
 ---------------------------------------------------------------------
 Attendance      Varies      $125 every 320  $75 for initial 160
 Bonus                       consecutive     consecutive hours
                             hours worked    worked with no unexcused
                                             absence. After achieving
                                             160 hours, $20/ week can
                                             be earned each week
                                             until consecutive hour
                                             streak is broken.  Each
                                             employee could earn an
                                             additional $1,040 under
                                             this program.
 ---------------------------------------------------------------------
 Shift
 Premium        Varies         60c/ hour           80c/ hour
 ---------------------------------------------------------------------
 Monthly      $252/ month     $144/ month       Fixed Premiums
 family                                         1st yr - $151
 health                                         2nd yr - $177
 care premium                                   3rd yr - $194
 per employee
 ---------------------------------------------------------------------
 Percent of
 Healthcare       33%            20%                 20%
 cost to
 employee
 ---------------------------------------------------------------------
 Retirement
 Plan Benefits   Vary       65% multiplier      70% multiplier
 ---------------------------------------------------------------------
 Retiree      Generally    Current retired   Current retired employees
 Health       not covered  employees pay     continue to pay
                           $175/ month for   $175/ month for five
                           five years after  years after they retire.
                           they retire       For employees who retire 
                                             after the effective date 
                                             of the new agreement, the
                                             retiree's share of the
                                             monthly premium will be
                                             set at $255 for the life 
                                             of the new agreement.
                                             In the event of a
                                             retiree's death prior to
                                             the end of the five-year
                                             eligibility period, the
                                             surviving spouse may
                                             continue coverage for the
                                             balance of the five year
                                             period, at the same
                                             monthly rate.
 ---------------------------------------------------------------------
 Length of      Varies         4 years              3 years
 Contract
 ---------------------------------------------------------------------
 Vacation and   9 paid     12 paid holidays  12 paid holidays with a
 Paid Holidays  holidays   with a maximum    maximum of 168 hours of
                with       of 168 hours of   vacation
               a maximum   vacation          Increase in vacation
              of 160 hours                   benefits for 1-4 year
              of vacation                    employees:
                                             1 yr - 56 hours
                                             2 yr - 64 hours
                                             3 yr - 72 hours
                                             4 yr - 88 hours
 ---------------------------------------------------------------------
 Work week   5-8 hours/day  4-10 hours/day   4-10 hours/day
 ---------------------------------------------------------------------
 ** 9.2% wage increase is one of the largest first year hourly wage
 increase in the company's history. This initial increase was designed
 to quickly and directly address the economic impacts of Hurricane
 Katrina on our employees.

 c = cents

Northrop Grumman Corporation is a $30 billion global defense and technology company whose 122,000 employees provide innovative systems, products, and solutions in information and services, electronics, aerospace and shipbuilding to government and commercial customers worldwide.

CONTACT:  Debbi McCallam
          (228) 935-1690
          d.mccallam@ngc.com

Contact information

Huntington Ingalls Industries
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