UAW President Bob King confirmed the GM contract had been ratified by a 2-1 margin.
The United Auto Workers Union’s rank-and-file has approved a new four-year contract with General Motors by a nearly 2-to-1 margin.
The new four-year contract is effective immediately and also is expected to lead to the creation of 6,500 new jobs over the next couple of years at GM plants in the U.S. – perhaps more as it may prompt GM to bring work back to the U.S. from Mexico and Canada.
The final vote tally was 65% in favor of the agreement among production workers, and 63% in favor among skilled trades workers. Retirees, many of whom were angered by contract lack of pension improvements, were not eligible to vote.
The vote in favor of the contract while more than enough to ensure passage was actually low by historical standards, indicating a sizeable number of union members were dissatisfied with the pact. And it suggests the union could face rugged ratification votes after it settles contracts with Ford Motor Co. and Chrysler Group LLC
The union reached a tentative agreement with GM on Sept. 16, two days after their old contract expired. It had earlier been expected the union would first reach a settlement with Chrysler but those talks broke down in the final hours and the UAW shifted its focus to GM.
“The UAW and GM entered into this set of bargaining as America struggles with record levels of unemployment and an economy that shows little sign of improvement,” said UAW President Bob King.
“Because of President Obama’s and the American taxpayers’ backing of our jobs and our companies, we were determined to work together with GM management to grow jobs in the U.S. and to get more Americans back to work and we are doing just that, King added.
Going into the contract talks, which began in July, UAW leaders insisted they were seeking what King called “creative solutions,” with an emphasis on maintaining the competitiveness of the Detroit makers as a way to improve workers’ job security. After reaching the settlement with GM, officials underscored their position that the key call was “jobs, jobs, jobs.”
UAW Vice President Joe Ashton, who directs the union’s GM Department said, “In these uncertain economic times, we were able to win an agreement with GM that guarantees good American jobs at a good American company. When GM was down, our members sacrificed and saved GM. Now that GM is posting strong profits, our members, as a result of this agreement, are going to share in the company’s success.”
While UAW negotiators failed to get GM to abandon the two-tier job program that means most newly hired workers earn about half as much as veterans, it did get the base pay boosted to $19.28 over the term of the agreement – about $3 more than before.
The contract also provides a $5,000 Signing Bonus for all employees, and up to $4,000 in Inflation Protection and lump-sum payments over the term of the agreement. It also improved profit sharing, replacing the old plan with a new, more simple and transparent plan, with higher payouts in profit sharing.
“When it seems like everyone in America is getting cuts in benefits and paying higher co-pays and deductibles, we were able to maintain and improve on our current benefits,” said Ashton. “Most significant for our members, we were able to add unlimited $25 doctor’s office visits. To the credit of GM and the UAW, this improvement will both increase the long term health of our members and reduce overall plan costs.”
The union did have to make some trade-offs, however, and notably agreed to sharp cuts in its paid legal assistance program.
“The UAW has shown that we are totally committed to helping the U.S. auto companies succeed. GM is prosperous today because of its workers. It’s the workers and the quality of the work they do, along with the sacrifices they made, that have helped returned this company to profitability,” Ashton said.
UAW bargainers are again on a dual track, hoping to negotiate settlements with both Ford and Chrysler. If anything, the goal is to get even bigger up-front signing bonuses but Chrysler, in particular, has cited its weak financial position and is pushing for more concessions to balance out any increases it might approve.
UAW King insists that he won’t approve cuts that give one maker an advantage over the other, noting the union’s tradition of inking “pattern” agreements that share the same basic principles among all the Detroit makers.
I, as a retiree, have tried to be very supportive of the contract, and understanding of the fact that retirees would receive very little in apparent gains this year, and most probably would receive later benefit by added protection per adjustments and enhancements to the VEBA and perhaps later on, and quite quietly, making the pension fund whole again. But after attending plant open houses and talking to many retirees, there is a lot of anger among retirees, just waiting to boil over. While retirees do not have a vote, I would hope Mr. King realizes there are many other ways of making displeasure known in this day, most notably by the use of social media, which many retired boomers are proficient at and more than willing to employ. As I talked to a friend who is still an active employ and who could retire at any time, the question he most notably asked was, “What incentive do I have to retire now? You retirees got zilch, and why should I retire at this time?” A point to ponder for Mr. King, along with how this must look to many older employees at the transplants he would like to organize, who are probably thinking, “Wow! The UAW, even with the VEBA, apparently wasn’t too concerned about retirees this time. Would they do the same to me, if I were to start paying union dues and then decide to retire?” I’m sure what the UAW has done for retirees in the past would quickly be discounted in any anti-union campaigns by the import manufacturers. As I’ve said many times, I think overall it is a good contract, and I’m glad it was ratified so easily. But I also was rather offended that, at least from what I have read, the contract didn’t even thank retirees for all of the sacrifices they made during their working years in order to make the UAW the viable union it still is today. A little gratitude, even while they were negotiating our Christmas bonus away, would have been appreciated. I think Mr. King and the UAW/GM department owes the retirees a note of thanks, if not an apology for this apparent slight.