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Wisconsin wins, Mercury staying put

After a second union vote, the engine manufacturer will remain in Fond du Lac

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Mercury Marine's union workers in early September approved a contract proposal that will keep the company in Fond du Lac, Wis. Mercury plans to transition work from its Stillwater, Okla., facility to Wisconsin in the next 18 to 24 months.

It was the same agreement the union - the International Association of Machinists and Aerospace Workers - had rejected Aug. 23, prompting Mercury to announce it would shut down operations in Fond du Lac and transfer the work to Oklahoma. However, union members rallied for another vote on the proposal, which passed Sept. 4.

"We met with Mercury Marine top management and have a commitment that, with this vote, the company will stay in Fond du Lac and move more work to Fond du Lac over time," Philip J. Gruber, IAM Midwest Territory vice president, says in a statement. "Our members' vote for the company proposal, while being a very difficult decision, clearly says they are willing to work with Mercury to secure a sound future for themselves, the company and the community."

Mercury Marine president Mark Schwabero says the company will develop and execute a transition plan that balances the needs of employees, the communities and Mercury Marine's future.

"After weeks of intense discussions and completion of the voting process, we accept the union's ratification of our contract proposal," Schwabero says in a statement. "As we've stated throughout this important process, comprehensive changes to wages, benefits and operational flexibility are necessary for Mercury to effectively compete in a smaller and fundamentally changed marketplace."

Union officials originally said there would not be another vote on the proposal unless changes were made, but Mercury stood by what it called its "best and final" proposal. "We won't make changes to this contract because a) it contains changes that are necessary for Mercury to lower its cost structure and emerge from the current economic downturn as a stronger company better equipped to operate in a smaller, much different marine market, and b) it now appears the union is asking for changes to be made simply to create an appearance of change, and to engage in such an open sham is not something the company would take lightly," Mercury spokesman Steve Fleming said in an e-mail to Soundings Trade Only.

Union officials had said the company's proposal would eliminate pensions, jobs and health care for thousands of Wisconsin workers and their families. The union said Mercury repeatedly claimed a "yes" vote would preserve jobs and keep the company headquartered in Fond du Lac, but the company refused to make that commitment in writing.

This article originally appeared in the October 2009 issue.

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