JAY, MAINE -- Here at the birthplace of the world's largest paper manufacturer, where the Androscoggin River knifes through the forests of western Maine, International Paper Co. has been the mainstay of daily life since before the turn of the century.
Inside the company's sprawling 400-acre mill, five massive paper-making machines, each as long as a football field, roll out more than 500,000 tons of paper annually -- much of it destined for use in "check-out" magazines sold at supermarkets. Outside, rumbling, log-hauling 18-wheelers are as common as buses in a major city.
"Making paper is something that's been handed down for generations," said Claire Therrien, 51, whose husband, father, and many other family members have spent all or most of their working lives with International Paper. "It makes us who we are."
This summer, however, the routine of generations was snapped when 1,250 hourly employes walked off their jobs after the company said it wanted to eliminate about 170 positions through attrition and new work rules and to eliminate premium pay for working a regular Sunday or holiday shift.
The strike has split friends and family members in this tiny mill town where management and hourly employes often live side by side. "It's brother against brother, father against son," said Therrien, whose husband walks a picket line while his brother works inside the mill.
But the labor strife and family turmoil here is only part of a spreading, nationwide dispute between International Paper and the United Paperworkers International Union.
Since March 21, when the company locked out 1,200 union members at its mill in Mobile, Ala., about 2,200 additional workers have walked off their jobs here and at International Paper sites in Lock Haven, Pa., and De Pere, Wis. Contracts affecting 1,135 more UPIU members at mills in Pine Bluff, Ark., and Corinth, N.Y., will expire this month.
The strikes have grown bitter, union officials say, because the company has hired replacement workers to keep its mills running and because its proposals for cuts in Sunday pay and more flexible job assignments come at a time when the once-moribund paper industry is earning substantial profits.
International Paper recently told stockholders that its 1986 profit more than doubled to $305 million ($5.79 per share) after sales rose 22 percent to $5.5 billion. And some market analysts believe the company's performance could be even better in 1987. "We're forecasting record earnings for this year," said Larry Ross, an analyst for Paine Webber Inc. who follows the paper industry.
Nevertheless, company officials point to average salaries, such as those here, where hourly workers earn $37,000 per year plus $8,000 in benefits, and insist that a streamlined work force is essential to maintain profits in the face of increasing domestic and foreign competition.
"Our ability to succeed depends on our continuing ability to compete," said William I. Greener, International Paper's director of corporate communications and state affairs.
Union officials say they are particularly angered by the company's recent contract proposals because, when the paper industry was being besieged by imports because of the strong dollar a few years ago, union locals agreed to changes in work rules and Sunday pay cuts at some International Paper facilities as well as at mills owned by competitors.
"In the past, when they were faced with tough markets, we were willing to make concessions," said Monte Byers, a UPIU spokesman at the union's Nashville headquarters.
But company officials say these same concessions are now making it difficult for some International Paper facilities -- those where the concessions were not made -- to compete with rival mills.
"If your competition has already done it, how can you afford not to?" said Joseph Pietroski, public relations manager at the company's Jay mill.
In response to what it perceives as a company attempt to win ground in job flexibility and Sunday and holiday pay nationwide, the union has launched a corporate campaign aimed at weakening International Paper's standing with customers, Wall Street analysts, and environmental regulatory agencies.
In July, union officials say, the international mailed more than 200 letters to securities and research analysts detailing the union's position in strikes that could affect company profits. This week, the union is preparing a mailing to company customers recommending that they consider International Paper's competitors, officials said.
The union has also adopted a coordinated bargaining approach, in which locals will vote separately on contracts, but the results will be withheld until contracts are settled at all International Paper mills.
In Jay, where about 1,100 UPIU (Local 14) members are negotiating beside 150 striking members of the International Brotherhood of Firemen and Oilers (Local 246), the most volatile issue is the fate of more than 700 replacement workers who have helped boost mill production to 77 percent of the pre-strike level.
"The No. 1 item on our agenda is that all the scabs will be out and all the union people will return," said William Meserve, president of Local 14 and an International Paper employe since graduating from high school 30 years ago.
Although the company has set up 52 temporary trailers at the mill to house about 200 maintenance workers from an Alabama firm called BE&K Construction, the 700 production and maintenance workers are mostly Maine residents who must pass angry picketers twice a day.
Much of the vitriol aimed at these workers -- the epithets, the rocks, the ball bearings fired from sling-shots, according to company officials -- stems from a UPIU stike waged last year at a mill owned by Boise Cascade Paper Group in nearby Rumford. In that action, 342 UPIU members lost their jobs to replacement workers after the union gave in to company demands.
This year, the union is hoping that its coordinated bargaining campaign, plus money raised from a proposed increase in union dues of $10 per month from about 250,000 nonstriking members, will help force different results.
"We're going to rally our whole union," said UPIU President Wayne E. Glenn at an Aug. 12 rally here attended by more than 1,000 foot-stamping strikers and sympathizers.
But Pietroski, the local company spokesman, said that while the company wants union members to return to work, he believes it's unlikely that it will dismiss many of the replacements. "Our position is that they are permanent workers," he said. "What we're not sure about is how many jobs are left open for the old workers."
In an area where the average annual wage is about $15,000, he said, hiring has not been a problem.
Although the company's stock has performed well so far this year, some Wall Street analysts are speculating that the strike will spread and erode International Paper's profits. In July, Standard & Poor's Corp., which rates the financial strength of companies, cited International Paper's labor problems and recommended that investors avoid its stock.
Union officials and financial analysts say they believe the strike could become costly because many of the company's paper mills are not profitable until they produce at about 85 percent of capacity. They also believe that inexperienced replacement workers may not be able to produce the high-quality paper necessary to compete on the open market.
As the strike wears on, the stakes for Jay could also be high. Town Manager Charles Noonan said International Paper pays 82 percent of the town's taxes, or $4.8 million a year. And, although it has large land holdings throughout the state, the company provides an additional boost to the area economy by purchasing about 85 percent of the wood for its Androscoggin Mill from local producers.
Furthermore, the town budget is being strained by police costs associated with the strike and by legal costs stemming from a federal lawsuit filed by the company.
But because about 400 of the town's 5,100 residents are strikers, International Paper appears to wield little clout within local government here. Recently, when local officials called a special town meeting to ask residents to approve a $220,000 supplemental police budget, union officials agreed to support the measure but drafted three ordinances aimed at clipping International Paper's wings.
One would keep the company from using BE&K's construction services, another would restrict its use of temporary trailers. A third would give town officials money and authority to enforce state and federal environmental regulations at the mill. The council meeting where the proposals were considered was dominated by several hundred chanting union members and friends who pushed through each of the ordinances with little debate in a record 29 minutes.
International Paper officials did not attend, preferring to express their opposition in a federal lawsuit. "It is neither proper, just, nor legal for a municipality to adopt laws which are clearly aimed at one party to affect the outcome of a labor dispute," said the company in a letter to the town's five selectmen.
Meanwhile, local business appears to have declined sharply. During a 40-minute weekday interview with two employes at Grimaldi's Clothing and Footwear, located near the center of town, not a single customer entered the store. "It hasn't been the greatest back-to-school year," said Claire Therrien.
Even if the strike were settled soon, she added, it might not be possible to meet the costs of repairing friendships and damaged family ties. "This town will never be the same," she said.