The new agreement, which comes into effect in April 2012, was ratified by workers in Menomonee Falls, Wis., and Tomahawk, Wis., after Harley-Davidson threatened to move its operations outside of Wisconsin.
Under the new labor agreement, Harley-Davidson will freeze wages for four years and reduce its work force by approximately 325 workers including 250 in Menomonee Falls and 75 in Tomahawk. The agreement would also establish a two-tiered workforce consisting of about 700 regular employees and 150-250 “casual” employees who will be called in for seasonal needs or to cover for regular employee absences. Full time hourly employees will also receive the same health benefits plan that salaried employees receive.
“Change is never easy, and we have asked our employees to make difficult decisions. However, we are pleased to be keeping production operations in our hometown of Milwaukee and in Tomahawk,” says Keith Wandell, president and chief executive officer of Harley-Davidson Inc. “Together, we are making the necessary changes across our entire company to succeed in a competitive, global marketplace while continuing to meet and exceed the expectations of our customers.”
Harley-Davidson estimates annual savings of $50 million beginning 2013, the first full year under the new labor agreement.