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On Feb. 16, hotel workers telephoned UAW Local 974`s union hall to say a number of men with suitcases full of security guard uniforms had checked into Peoria`s Mark Twain Hotel.

Soon after came calls from sympathetic security guards at Caterpillar. They reported seeing young men-dressed in dark blue jump suits, dark blue baseball caps and military boots-roaming the company grounds.

And, the guards added, they looked tough.

Local 974 President Jerry Brown was furious. From his point of view, the company had brought in ”rent-a-thugs.”

Their presence indicated to many that the stakes were suddenly rising.

Strikers asked Caterpillar why it would bring in outsiders against them, their own workers. Against middle-age, middle-class Americans.

The guards` arrival killed Brown`s hopes for a deal and ended his visits to high-ranking friends at Caterpillar. The visits had gotten him into trouble at the union hall, but he defended them, saying he thought he could make headway. After all, he said, the executives were his neighbors and friends.

The guards were from the Asset Protection Team of Vance International Protection Services of Oakton, Va., a firm well-known to other unions. Caterpillar wanted the guards to videotape any violence so that offenders could be prosecuted or fired.

Since Chuck Vance left the Secret Service and started his own protection business eight years ago in suburban Washington, his $23 million-a-year firm has worked labor disputes at 300 different companies.

Caterpillar feared that thousands of autoworkers would descend on its plants, because, as Vance recalls company officials telling him, they

”thought that the UAW had a lot to lose.”

The union didn`t know it, but Caterpillar was getting ready to advertise for permanent replacements.

The company`s officers had been developing their strike strategy in daily meetings at Caterpillar headquarters. They saw the dispute as a series of options. With each move, they eliminated another.

Every executive knew that if it came down to it, they had an option that could beat the strike. They all knew that if the workers didn`t come back, the company could move to replace them. It was an option their Caterpillar predecessors had never known was there.

By February, the company, expecting orders to increase in the second half of the year, was ready to push on.

On Feb. 3, Caterpillar announced it would simultaneously end its lockout of 5,650 workers and make one last contract offer to the union.

The union responded by putting those workers who had been locked out on strike.

On Feb. 12, Don Fites told his board of directors that other options would be tried first, but hiring replacement workers was a distinct possibility. It was the first time the issue had been broached outside management`s inner circle.

The talks at which Caterpillar made its offer were arguments, not discussions. During one of the February meetings, a frustrated Caterpillar President Jerry Flaherty said the offer would be the company`s last. ”The money is all on the table,” he said.

An angry Casstevens asked why Caterpillar had hired the Vance ”thugs.”

The cursing that is as much a fixture at the negotiating table as pitchers of water was sometimes so loud that it could be heard through closed doors.

The two sides met again in March outside St. Louis after reports surfaced that the union was ready to back away from pattern bargaining.

But once seated at the table, they found that fundamental positions had not changed. The union said it was willing to bargain item by item. Caterpillar said it was still faced with a pattern agreement, which it would not accept.

Caterpillar said the talks were at an impasse. The union replied that it was still willing to bargain.

”Up your impasse,” Casstevens snapped.

Later, he told reporters he didn`t think there was an impasse. ”Maybe I should suggest an enema or something, because we don`t seem to have a problem with it,” he said.

Back in Peoria, Caterpillar put the finishing touches on its decision to bring in replacement workers.

The decision filled young executives, like Gary Stroup and A.J. Rassi, with a sense that they were stepping into the unknown.

”I never had such a feeling of enormous change that was occurring in the company,” said Stroup, ”and perhaps for labor in the United States.”

”We were in new territory,” said Rassi.

It was clearly one of the most important labor decisions the company had ever made. Yet many of the people who made it say they cannot recall the instant that the decision was finalized.

It was, instead, a narrowing of options.

Neither Rassi nor Stroup acknowledges remembering when the decision was finalized. Nor does Brust. Nor does Flaherty. Nor does Fites.

”The meetings tend to blur together,” Fites would later say.

The company guessed that in a worst-case scenario, only about 1,000 replacements would actually be hired. The power of the threat would be so great that it would drive the workers back. The company, as it had done throughout the dispute, would appeal directly to the worker.

”We knew that they wanted to come back, but they would have to have a strong reason to justify it to their colleagues,” said Don Fites. ”It was obvious the union wasn`t going to let them vote on anything, so we had to come up with a way to vote with their feet.”

On April 1 Caterpillar mailed out letters, backdated to March 31, spelling out the consequences if workers did not return by April 6.

Chuck Lovingood was watching television when he heard the company would begin replacing him and his fellow strikers if they did not return to work on Monday. He immediately went to the phone to call the union hall and ask what he should do.

Jan Firmand got the news by telephone from a friend and fellow Caterpillar worker. She had no idea what she would do.

Dick Owens was working on a survey crew-his temporary job during the strike-when he heard the news over the car radio. In that very instant, he knew what he would do.

On the picket lines, manned now for more than five months, the tension mounted. Older workers close to retirement worried out loud about what would happen to their pensions if they were crossed off the company`s rolls.

Suddenly the stakes had risen again. They were no longer fighting for a few cents more in cost-of-living increases, or full company underwriting of their health insurance.

Now it was a fight for their jobs.

On the Sunday night before Caterpillar`s ultimatum was to take effect, the leadership of Local 974 met. Most felt the UAW had to stand up to the return-or-be-replaced order. Ron Logue thought the union needed to hold out for two more weeks for Caterpillar to surrender.

Harold Snider, a grievance chairman from East Peoria and one of the opposition members within the local, thought differently. And he decided to speak up.

He had researched the history and laws on replacement workers and was convinced the UAW was walking into a trap if it did not return to work.

Snider raised his voice to say that their effort was well-meaning, but it was a mistake now. It was exactly what Caterpillar wanted.

He had challenged the leadership before, and they made him feel as if he was disloyal, or lacked a backbone. But this time, he pushed on. It was time, he said as persuasively as possible, to put the people back to work.

His warnings went unheeded.

Come morning, the union was going to stand firm, giving Jimmie Toothman, Jim Mangan, Dick Owens, Chuck Lovingood and Jan Firmand the showdown they had expected. They and the others would finally show Caterpillar which side they were on.

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Next: Peoria takes sides.