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Farm Machinery Manufacturer Announces Wage Freezes

December 3, 1985

RACINE, Wis. (AP) _ Wages of almost 10,000 salaried employees will be frozen as part of a worldwide cutback in labor costs by JI Case Co., the farm implement manufacturer says.

Company spokesman David Brukardt also said Monday that some plant closings are planned in 1986 along with worker layoffs.

It is the third time since 1980 that wages of salaried employees have been frozen, he said. The last freeze began Sept. 1, 1982, and lasted 18 months.

Brukardt said he knew of no target figures for cuts in employees, but said both salaried and hourly employees could face layoffs.

Case President Jerome K. Green said in a statement that ″reducing overall costs by 25 percent over the next four years continues to be a primary objective.″

But Brukardt said that did not necessarily mean a 25 percent reduction in employment.

″Cost reductions come from all areas. We’re finding ways to become more efficient in production″ through robotics and previous plant consolidations, he said.

About 2,000 Case employees in Racine would be affected by the freeze, the subsidiary of Houston-based Tenneco Inc. said.

Members of United Auto Workers Local 180 have had wages frozen since 1983, except for small cost-of-living hikes, union Recording Secretary Paul Kielbasa said Monday.

Kielbasa said a 7-cent-an-hour cost-of-living raise went into effect Monday, and union members are to receive a 3 percent wage hike next summer. It was unclear how the cutbacks would affect his local, he said.

″I can’t say whether or not it will affect Racine,″ he said. ″Essentially it depends on where the markets go.″

Case employs about 29,000 people worldwide, including nearly 4,000 at its Racine County operations, Brukardt said.

It has been losing money steadily since 1979, according to company reports. Tenneco’s 1984 annual report said Case has a pre-tax, pre-interest loss of $105 million.

Charles Schneider, a Tenneco spokesman in Houston, said Monday that Case’s performance improved significantly in the third quarter of 1985. Case officials expect to show a profit in the fourth quarter, he said.

Brukardt said the company is making medical insurance more costly for salaried employees, and no longer will provide pay in lieu of vacation.

In an effort to control inventory, Case plants in Racine were shut down for the first 12 weeks of 1985.

There are no plans for an extended shutdown this winter, Brukardt said, but the production line has been slowed at the tractor plant. Production should remain reduced through early next year, he said.

Case also has plants in Illinois, Kansas, Indiana, Iowa and Oklahoma. It also has operations in Australia, Brazil, France, West Germany, Spain and the United Kingdom.

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