June 2011

Northrop Grumman Shipyard Spinoff Builds
IBEW Hopes
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Corporate spinoffs often pump new uncertainty into already trying times for workers. Sometimes, however, their insecurity is softened by the hope that new owners will be an improvement over the ones packing their bags. Such is the case for 1,800 IBEW members who build U.S. Navy ships in Pascagoula and Gulfport, Miss. and New Orleans, La.

In March, Northrop Grumman announced that its shipyards in those states, another massive facility in Newport News, Va., and a smaller one in San Diego would be spun off to a new entity, Huntington Ingalls Industries. The new company, now up and running, expects to bring in $6.7 billion in annual revenues with a backlog of more than $17.3 billion of work.

Founded by Ingalls Iron Works, the Mississippi and New Orleans yards opened on the east bank of the Mississippi River in 1938. Charles Huntington was the original owner of the Newport News yard, built in the late 1800s. The Newport News yard is organized by the United Steelworkers.

"Workers never stopped using the name, Ingalls. We're going back to our roots, with long-serving managers we know and respect," says IBEW Government Employees Department Director Chico McGill.

Already, the Huntington Ingalls' managers have set up an unprecedented meeting to discuss safety issues between union representatives and a company vice president.

The Navy immediately started issuing some contracts for new work that had been held back by the uncertainty of the prior entity's status, including a $1.5 billion project building the 10th in a series of amphibious transport docks. Talks are underway on the yards receiving other major work, including re-designed guided missile destroyers.

Since their purchase by Litton Industries in 1961 and by Northrop Grumman in 2001, says Pascagoula Local 733 Business Manager Jim Couch, "the shipyards were on the backburner of those huge companies' holdings." Now, he says, experienced and respected shipbuilders, led by CEO Mike Petters, will be in control.

"We will fly by our own steering, not by an outside corporate entity," Couch says.

McGill, a former business manager of Local 733, has deep concerns over the future of IBEW members and others at the company's Avondale shipyard on the west bank of the Mississippi — which Northrop Grumman had announced would be closed in 2013. McGill hopes that active discussions with Petters and other executives over the potential to bring new work into the yard, will bear success. (A video on the Avondale struggle can be viewed on the IBEW's Web site — www.ibew.org.)

McGill credits the former president of Ingalls Shipbuilding, Jerry St. Pé, with improving labor relations at the yard after a bitter six-year fight between the metal trades and the company that ended with a successful 1999 representation election.

In a recent op-ed in The Mississippi Press, St. Pé said, "I envy those who will be aboard the journey of restoring the fine tradition associated with the name Ingalls."

At the 19,000-worker Newport News yard, hundreds of mid-level manager jobs have been cut since the spinoff, but no union jobs, says USW International Staff Representative William Harriday.

"Northrop Grumman kept some managers around mostly as a contingency," says Harriday, who says his dealings with Petters have always been "open and upfront."

In a May 5 meeting, Petters told representatives of the metal trades and the IBEW that Adm. Kevin McCoy, the commander of Navy sea systems, had visited Pascagoula twice to look at quality issues. Petters said McCoy was satisfied with the quality of construction and said he had no plans to return.

The USS New Orleans leaves the Avondale Shipyard in 2007.

Photo used under a Creative Commons license from Flickr user mashleymorgan.