Academic journal article Monthly Labor Review

Merck, Three Unions Settle, End 15-Week Strike

Academic journal article Monthly Labor Review

Merck, Three Unions Settle, End 15-Week Strike

Article excerpt

The longest strike in the history of Merck & Co. ended when the firm settled with a council of unions including the Oil, Chemical and Atomic Workers, the Chemical workers, and the Clothing and Textile Workers. The major issue in the 15-week walkout was a company demand for employee pay cuts to enhance Merck's ability to compete with other pharmaceutical companies. Merck claimed its wage rates were 18 to 46 percent above its competitors and that its employees earned an average annual salary of $34,500 in 1983. Union officials disputed this, claiming that the average was about $23,000.

Merck's demand for compensation cuts included a call for adoption of a two-tier wage system under which new employees would be permanently paid less than those already on the payroll. The final provision did not amount to a true two-tier system because the additional pay sacrifices applicable to new workers would be recoupled. The 4-year contract does not provide for specified wage increases or automatic cost-of-living adjustments in the first year. Current employees will receive lump-sum payments of $700 on April 30, 1985; $800 on April 30, 1986; and $500 on April 30, 1987. …

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