Vol. 80/No. 4 February 1, 2016
Big Three auto bosses keep hated tiered wages system
Big Three pretax profits for the first three-quarters last year — $8.3 billion for GM, $6.6 billion for Ford and $3.4 for Fiat Chrysler — come from concessions recommended by union officials and approved by the membership in October 2007 at the onset of a sharp contraction of world production and trade. Fiat Chrysler cut UAW labor costs from $5.5 billion in 2007 to $3 billion last year. GM’s labor costs fell from $9.4 billion to $7.1 billion.
GM cut pay for new hires to $14 an hour in 2007, half of the pay of many autoworkers at the time, and transferred health care costs for half a million retirees to a union-run trust fund.
When GM filed for bankruptcy in 2009 union members, pressured by officials, bosses and President Barack Obama, accepted the suspension of cost-of-living increases, bonuses and some holiday pay, along with a six-year strike ban.
One of the worst concessions was allowing bosses to hire temporary part-time workers, creating a third tier who are members of the union but ineligible for the benefits of permanent workers and subject to termination at any time.
Chrysler workers reject first offer
Union officials began pattern-bargaining negotiations with Fiat Chrysler in 2015. On Sept. 16 they recommended acceptance of a contract that continued the tiers. But the membership voted 2 to 1 against it.A second proposal was returned two days later. Officials hired a public relations company to promote it. On Oct. 22 they announced the proposal had carried by 77 percent.
Under the new contract, Tier Two workers are to top out at $28, almost the same as those hired before 2007, after eight years. But the contract is a four-year agreement and many will be receiving only $22.50 per hour when it expires.
The clause perpetuating part-time temporary workers was omitted from the contract summary and buried on page 265. Newly hired temp workers will start at $15.78 and top out at $19.28 after five years, while those hired during the old contract get pay raises that top out at $22.
“At the Fiat Chrysler Jeep plant here the first contract was rejected by 87 percent of the production workers and the second barely passed,” Alan Epstein, a member of UAW Local 12 in Toledo, Ohio, told the Militant. “The turnover rate is pretty high and conditions are bad. With 60 cars an hour going through the line, we don’t get the two seconds we used to between them. The temporary part-time workers are moved around and get the worst jobs, so they can never get up to speed.”
“I voted against it,” Edward DeLuna, another member of Local 12, said by phone Jan. 10. DeLuna got hired on temporary part time last spring. “They want us to be TPTs forever.”
Similar contracts were ratified at GM and Ford by slim majorities — 55.4 percent at GM and 51 percent at Ford.
“The union officials didn’t discuss with us what we could do to get a better contract,” said Aradia Clark, a member of Local 551, who has worked at the Chicago Ford plant for several years. “They didn’t come to areas where the newer workers are.”
The national agreement settles the financial questions while job conditions, health and safety are decided locally, allowing bosses more leverage in their productivity drives.
The low ratification votes and the rejection of the first contract at Chrysler were signs that many autoworkers are looking for a way to fight back. They identify with and are inspired by the fight for $15 an hour and a union carried out by fast-food, retail, airport, home care and other workers over the past two years. Thousands of autoworkers make close to $15 per hour.
The contract won’t “break the bank,” RBC Capital Markets analyst Joseph Spak said in a note to investors, according to the Wall Street Journal, especially since many of Ford’s higher paid veteran workers will retire in the coming years, something the bosses are encouraging. The GM contract offers a $60,000 retirement incentive and Ford offers $70,000.
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