United Auto Workers strike better deal with GM
30 Oct 2015
The United Auto Workers union has worked out a better deal with General Motors Co than it did with Fiat Chrysler Automobiles NV that was approved by members last week.
Under the tentative agreement, lower-paid entry-level workers will get the same pay and medical benefits that long-time factory hands receive.
GM's ratification payment of $8,000 for all members is double the amount workers receive at Fiat Chrysler.
The profit-sharing formula remains intact as in the previous contract and not the revised Fiat Chrysler formula, which should offer bigger payouts in a company the size of GM.
Under the tentative agreement, reached late Sunday, the so-called Tier 2 workers will get the same health-care benefits and eventually the same wage as senior workers.
The agreement will now go to rank-and-file members for a vote.
The UAW had pushed for a better deal with GM as the automaker is larger and more profitable than Fiat Chrysler. GM's third quarter results last week showed record $3.1 billion adjusted profit for the third quarter. According to commentators, with strong earnings, UAW leaders probably needed better terms from GM and from Ford Motor Co to win ratification votes.
Meanwhile, GM has promised the United Auto Workers union, additional investment of $1.9 billion in its US factories to secure 3,300 union jobs, and pay higher wages and bonuses under a proposed four-year contract.
GM will also pay bonuses of up to $8,000 to nearly 53,000 UAW workers once they ratifiy the agreement, according to details of the GM-UAW contract released Wednesday.
Under the deal 4,000 UAW workers would also get $60,000 worth early retirement packages.
Both veteran and recently hired union workers at GM's US operations would get raises.
UAW workers at GM had not had an hourly pay increase in a decade, but should get 3 per cent base wage hikes in two of the four years of the new pact, if it was ratified.
Workers hired since 2007 would for the first time be able to earn the top wage for veterans provided they remained with the company for eight years.