Kaiser's New Approach

As they went on shift in Fontana, Calif., last week, 7,000 employees of the Kaiser Steel Corp. stopped off at improvised polling booths at the plant gates. By an overwhelming 74% vote, the Kaiser workers agreed to give a four-year trial to an experimental labor contract that may ultimately alter the tone of collective bargaining in the U.S.

The new Kaiser contract is the product of two years' work by a committee that Kaiser Chairman Edgar Kaiser, 54, and the United Steelworkers set up in a joint effort to prevent a repetition of the bitter 1959 steel strike. The plan aims to avoid endless haggling over wage rates and to soften the impact of technological change in the rapidly automating steel industry. Basic elements:

> The Kaiser local of the United Steelworkers will not have to do any wage bargaining at all, will automatically get the same wage increases that the union wins in its negotiations with the Eastern steel companies.

> Each month Kaiser will divide up among its workers 32.5% of whatever savings the company achieves by increasing productivity or cutting the cost of its supplies. (The figure of 32.5% was selected because labor accounts for about a third of Kaiser's costs.) If the savings to be divided grow big enough, the union will let Kaiser store up some of them to be used to pay any future increases in basic steel wages.

> No Kaiser employee will be laid off if his job is eliminated by automation, and if he is forced to move to a lower-paying post, he will go on being paid at his old rate for a year.

So far, reaction to the plan from other steel companies has been unfavorable. They fear that it takes away management's basic right to decide how to spend its income, and opens the company's most intimate statistics to union officials. Even Steelworker President David J. McDonald is not yet prepared to give the Kaiser plan a final endorsement: he wants to see how it works out during its four-year trial period and is unlikely in the meantime to demand similar concessions from the Eastern companies. But if it proves successful, the Kaiser plan might work a significant change in the psychology of U.S. unions by giving labor a positive interest in the progress of automation.

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