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Delphi workers brace for new cuts Bad news rekindles talk of a strike

Many of the more than 2,000 workers at the Delphi Thermal Systems plant were told Tuesday to brace themselves for drastic new cuts in pay and benefits in a scenario they said was like reliving a nightmare.

Members of Local 686, United Auto Workers, shaken a year ago with layoffs, pay cuts and early buyouts, listened anxiously as international union leaders said they may face another round.

The update on contract talks, delivered behind closed doors, rekindled talk of a strike at the region's largest manufacturing employer. The current contract expires in September, but several workers said they expected a walkout before then.

"It's the same old story over and over again," said John Miller, an eight-year Delphi worker and a father of six.

Workers were told that the company wants to slash the wages of veteran workers who make about $27 an hour to around the $14 level currently being paid new workers.

"The company is asking for the world," said Robert J. Pilhorn, who worked at Delphi for 38 years and is now president of Local 686 Retirees. "They want cuts all the way down the line, from wages to health benefits to life insurance."

After two 90-minute meetings in the union hall on Walnut Street, union members said they were under strict orders not to talk to the media. Most of them walked quickly to their vehicles without comment, many on their way back to work, and representatives of the international union de
clined to speak.

When asked what they heard inside the union hall, one worker called back, "All bad news."

Delphi company officials could not be reached to comment.

Delphi employees have been on a roller-coaster ride for the past year, since the nation's largest auto parts maker, operating under Chapter 11 bankruptcy protection, asked the bankruptcy judge to void its labor contracts.

The company has been working to emerge from bankruptcy with $3.4 billion in funding from five private equity firms. That deal was contingent on reaching new wage and benefit concessions from the unions. However, talks have bogged down as the equity firms, concerned about future wage costs, have sought further cuts.

Last week, one firm, Cerberus Capital Management LP, threatened to pull out of the deal, taking its $1.7 billion with it. That would force the other groups -- Appaloosa Management LP, Harbinger Capital Partners Master Fund I, Merrill Lynch & Co. and UBS Securities LLC -- to seek other partners or try to restructure the deal.

John Lunghino, a financial adviser who works closely with Delphi employees, said Tuesday's talk of further cuts is the last thing workers wanted to hear.

"Over the past year, we have seen hundreds of employees who have had to sort out employment, retirement and budgeting issues," he said. "The uncertainty had just started to settle down and become manageable, and now we have another wave of decisions and questions."

Nearly 1,000 employees from the Lockport plant have taken early buyouts. Workers with 30 years' service walked away from the Upper Mountain Road factory with $35,000 and their medical and pension benefits intact. The payoffs diminished for those with fewer years of service.

Paul W. Siejak, president of Local 686 Unit No. 1, tried to put a positive light on Tuesday's meetings.

"This is the first time there has been a direct dialogue between the local union members and their international representatives," he said. "They wanted feedback, and they got it. There were a lot of questions and answers."

The answers were hard to swallow, judging by the grim looks on the faces of workers as they left the union hall.

"Everybody's nervous," said Joe Harris, a rookie who joined Delphi seven months ago. "We don't like it, but we've got to do what the union says."

e-mail: bmichelmore@buffnews.com

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