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Union, Shipyard Agree to Contract

Monday, July 17, 2017

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Union workers at United States’ largest shipyard voted Thursday (July 13) to approve a new contract, increasing wages and pensions and keeping health care costs for workers in check, but closing the company’s pension plan to new hires in favor of a retirement plan.

Newport News Shipbuilding
Newport News Shipbuilding

Union workers at Newport News Shipbuilding, the country's largest shipyard, overwhelmingly approved a new contract that will run through late 2021.

United Steel Workers Local 8888 announced that, by a nine-to-one margin, members working at Newport News Shipbuilding approved a new contract the union had negotiated with shipyard owner Huntington Ingalls Industries.

The contract involves annual wage increases ranging from 1.5 percent in 2017 to 3 percent in both 2019 and 2020. Workers will receive a 2.6 percent raise in 2018. The contract took effect retroactive to Monday (July 10) and runs through November 2021.

Pensions and Health Care

According to HII, pensions for eligible employees who have been with the company consistently since 2004 or earlier will increase from $1,550 to $1,800, effective Oct. 1. New hires after July 10, however, will no longer participate in the pension plan; the company will instead offer a Retirement Account Contribution Plan.

According to a copy of the tentative agreement posted on the union's website before the vote, employees brought on between 2004 and 2017 will continue to be eligible for pension benefits based on 5.5 percent of the employee's total compensation.

Both sides say the new contract helps to keep health care costs for workers down. “Significant plan design changes were made to support lowering overall medical plan costs while securing health care premiums that will not considerably impact employee wage increases,” HII said in a press release.

“We looked out for members stuck in certain pay grades," Local 8888 president Arnold Outlaw said. "We rolled back health insurance premiums, and indeed, we rocked the boat with this contract!"

Other Language

Both sides also claimed secondary wins in the agreement.

“The agreement continues to include language that enables Newport News to maintain critical flexibility to get work, keep work and perform work in a cost-effective manner,” HII said.

For its part, the union said the contract includes signing bonuses and bolsters promotional opportunities for workers.

“This offer is fair, competitive in the industry and respectful of the needs of our great shipbuilders,” said Susan Jacobs, Newport News’ vice president of human resources and administration. “It’s an offer that also maintains our competitiveness in the shipbuilding industry and our flexibility to respond to our Navy customer’s needs in a cost-effective and timely manner. I applaud everyone who participated in the negotiations process.”

About NNS

Newport News Shipbuilding is the sole designer and builder of aircraft carriers, and one of two makers of submarines, for the U.S. Navy. Founded in 1886, the shipyard was bought by Northrop Grumman in 2001, and Huntington Ingalls was spun off from that company in 2011.

The shipyard employs about 20,000 people, making it the largest industrial employer in Virginia. USW represents nearly 10,000 workers at the site.


Tagged categories: Contracts; Labor; Newport News Shipbuilding; Ships and vessels; Shipyards; Unions

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