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GM Reaches Tentative Pact With UAW Workers, Avoiding Strike

Image: GM Reaches Tentative Pact With UAW Workers, Avoiding Strike

Monday, 26 Oct 2015 07:54 AM

General Motors Co. and the United Auto Workers reached a tentative four-year agreement that is expected to provide raises across the board, averting a potential strike.

The union announced the deal in an e-mailed statement without giving details. A vote by union members at Detroit-based GM was set for Wednesday.

UAW President Dennis Williams sought richer agreements with GM and Ford Motor Co. after gaining a deal on Oct. 22 with Fiat Chrysler Automobiles NV. In that accord, the union won raises for all members at Fiat Chrysler and a path to bring wages of so-called Tier 2 employees equal to those of senior workers. That pact will cost Fiat Chrysler close to $2 billion over four years, people familiar with the matter have said.

“GM is in far stronger economic shape than Chrysler, and the union wanted to see more in what they got from them,” Harley Shaiken, a labor professor at the University of California at Berkeley, said before the agreement. “These contracts provide an entrance ramp to the middle class. That’s a contrast to the contracts we’ve seen in recent years that provided exit ramps.”

The UAW for the first time in a decade is reaching agreements that add substantially to the Detroit-area automakers’ costs. In the agreement at Fiat Chrysler, which has smaller earnings than GM and Ford, Tier 2 workers’ hourly rate will eventually climb above $29 from a previous maximum of about $19.

Wage Gains

The deal could get entry-level, or Tier 2 workers raises just as the union’s deal with FCA did. In the union’s statement, Williams said there are significant wage gains and UAW Vice President Cindy Estrada said it gives workers a clear path.

“The significant gains in this agreement are structured in a way that will provide certainty to our members and create a clear path for all GM employees now and in the future,” Estrada said in a statement. “The agreement not only rewards UAW-GM members for their accomplishments, but it protects them with significant job security commitments.”

The union did not provide detail on profit sharing, which is a big issue at GM. UAW leaders want to keep the current structure of $1,000 a year for every $1 billion in profit rather than a margin-based structure adopted by FCA.

A GM spokesman declined to elaborate on the deal and issued a statement.

Labor Flexibility

“The new UAW-GM national agreement is good for employees and the business,” said Cathy Clegg, GM North America Manufacturing and Labor Relations vice president. “Working with our UAW partners, we developed constructive solutions that benefit employees and provide flexibility for the company to respond to the needs of the marketplace.”

The union’s deal with GM averted a potential strike. The UAW last struck GM in 2007 for two days before reaching agreement on a four-year contract that included a lower wage for new hires -- the Tier 2 workers -- to help the automaker through an economic downturn. GM and Chrysler ultimately went through government-sponsored bankruptcies in 2009.

“There is a profound difference between now and 2007 because GM and the UAW have built a solid working relationship,” Shaiken said. “The experience of the bankruptcy was searing for both sides.”

The Fiat Chrysler contract was approved by a 3-1 margin last week, after UAW members there rejected an earlier agreement and sent their leaders back to the bargaining table, The revised deal secured larger signing bonuses and bigger raises for the second-tier workers.


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General Motors Co. and the United Auto Workers reached a tentative four-year agreement that is expected to provide raises across the board, averting a potential strike.
gm, uaw, workers, strike
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2015-54-26
Monday, 26 Oct 2015 07:54 AM
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