Coverage by WMTW of Bath Iron Works’ recent announcement of the sudden resignation of Dirk Lesko, the shipyard’s president, gave renewed attention to an interview that Lesko provided to the television station in 2020.
On the eve of the Local S6 strike, which he had hoped to avert, Lesko told political reporter Phil Hirschkorn, “The reason we shouldn’t go on strike is it helps no one. It doesn’t help us meet our customers’ needs, and fundamentally, any business that doesn’t meet its customers’ needs can’t be successful.”
On its surface, Lesko’s statement is accurate, but he appears to be faulting the union for this problem because it was the union’s membership who voted to go on strike in the first place. However, if we look beneath the surface, we would realize that the blame ultimately lies with Lesko himself.
In 1984, BIW’s then-CEO warned Local S6 that if its membership did not accept a significant number of proposed reductions in their benefits and wages, the shipyard’s ability to secure future contracts would be jeopardized. The union rejected the proposal, yet the following year, BIW continued to secure shipbuilding contracts regardless. Consequently, the union membership largely believed that the CEO was attempting to lie and deceive them. As a result, the union went on strike for 99 days.
It has never been clear what caused that CEO to issue such a misguided warning in 1984, although it’s likely that he was pressured by his peers to do so. Nonetheless, he never attempted to reconcile with Local S6 even though his false alarm created an unmistakable breach of trust between himself and the union membership. During the next 37 years, none of the shipyard’s CEOs or presidents has developed a way to heal this breach. Consequently, morale and productivity throughout the workforce have remained low – and, correspondingly, labor costs of producing ships have been significantly higher than they need to be.
It is incumbent upon BIW’s next CEO that he or he take the initiative and heal these wounds. In order to accomplish this, it will be necessary for the new CEO to understand the following:
• Productivity, which is the lifeblood of the entire shipyard, is controlled not by the shipyard’s management but by the workforce. Union rules, which both management and labor signed on to, make it all but impossible for supervisors to fire workers for low productivity. If BIW’s management wished to change the rules, it would have to persuade the union workers to make it easier for them to be fired for low productivity. It is highly unlikely that the union workers would ever sign on to such a change because these rules shield them from being discriminated against.
Therefore, it will be necessary for the CEO and senior management to restore trust throughout the shipyard so that workers will believe that management is being open and honest with them once again. A simple way to begin this restoration would be for the next CEO to say, “We’re sorry” to the workforce for the misleading and misguided statements that had been made in the past.
• The heart and soul of BIW is its workforce because their remarkable capabilities are what make our ships safe, secure and highly functional. When I once worked alongside the workers, I discovered how accurately, quickly and skillfully they performed in all areas of the shipbuilding process
• Reestablishing an open, honest and trustworthy relationship with Local S6 will once again pave the way for ships to be built ahead of schedule and under budget, just as they had been in the past.
BIW, one of Maine’s largest employers, will become the great shipbuilding corporation it once was when its leadership succeeds in restoring the shining example of trust, honesty and equality that will finally bring everyone together, so that they can all work together again.
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