US union, GM reach tentative agreement on labor contract

26 Oct 2015 | Author: | No comments yet »

GM Reaches Tentative Pact With UAW Workers, Avoiding Strike.

The UAW said the agreement was reached at 11:43 p.m. FILE – In this July 13, 2015, file photo, United Auto Workers President Dennis Williams speaks as General Motors CEO Mary Barra, background left, listens during a ceremony to mark the opening of contract negotiations in Detroit. (AP Photo/Paul Sancya, File) The United Auto Workers has struck a tentative labor deal with General Motors, avoiding a strike that would have dented the company’s U.S. production and clearing the path for members to vote on the proposal, which sets pay and benefits for the next four years.DETROIT — Minutes before their contract was set to expire, the United Automobile Workers union and General Motors announced a tentative agreement Sunday night on a new national agreement covering about 52,000 employees.

Union officials didn’t disclose details of the agreement, which was announced minutes before midnight Sunday and covers 52,600 union-represented members at GM. UAW officials, in a statement, said the deal presents “significant” wage gains and job commitments, and provides a road map for entry-level workers to grow into the more senior hourly wage. 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. 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. “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.

GM reported last week that it earned $1.36 billion in the third quarter, including a record $3.3 billion pretax profit in North America on strong sales of trucks and SUVs.

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