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October 18, 2019 10:30 AM

UAW to continue GM strike until workers ratify tentative deal

Hannah Lutz and Michael Martinez
Automotive News
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    DETROIT—United Auto Workers union leaders voted to extend its national strike against General Motors until its members ratify a tentative agreement, a process that will take at least a week.

    After meeting for more than six hours on Oct. 17, the UAW's GM national council voted to send the deal for ratification and to keep members on picket lines until the deal is ratified. Informal meetings with local unions and voting will begin Oct. 19, and a union spokesman said the process should take about eight days.

    The UAW and GM reached a tentative deal on a new labor contract on Oct. 16 that covers wages and benefits for 46,000 hourly workers after a national strike against Detroit's largest auto maker that lasted more than a month.

    If members ratify the deal, negotiations would move to either Ford or Fiat Chrysler Automobiles. Representatives for both auto makers have continued initial discussions with the union while the focus was on GM.

    The tentative agreement would give full-time hourly workers a signing bonus of $11,000, provide wage or lump-sum pay increases of at least 3 percent annually and allow new hires to reach top wages in four years instead of eight, according to a summary of the deal provided by the union on Oct. 17.

    The four-year contract, if ratified, would result in all current workers earning at least $32.32 an hour by September 2023. Temporary workers would have a path to becoming full-time employees, the summary said.

    Profit-sharing payouts no longer would be capped at $12,000 annually, though the formula for calculating them would not change. Health care coverage also is unchanged.

    GM will contribute $1,000 to the pensions of workers hired prior to 2007 who still are eligible for that benefit and is offering $60,000 bonuses to up to 2,060 workers eligible for retirement who leave the company in January or February.

    The 46,000-member strike of GM has amounted to the loss of more than $835 million in wages since it began on Sept. 14. Lost profits for GM total $1.5 billion, according to the most recent analysis released by Anderson Economic Group on Oct. 16 as news of the tentative agreement broke.

    The decision to prolong the strike by another week means an additional $400 million in losses for GM, according to Anderson Economic Group. UAW workers are projected to lose $14 million more in lost wages per day and supplier employees who continue to be laid off will lose $20.5 million per day.

    With as many as 150,000 jobs estimated to be negatively impacted by the strike, the federal government has lost out on $313 million in income and payroll tax revenue and the state of Michigan has lost $18.5 million in income tax revenue, according to the Oct. 16 analysis.

    Of the nearly 150,000 total jobs impacted, Anderson earlier estimated that 75,000 supplier workers have been laid off or had hours or wages reduced since the strike began along with 25,000 GM salaried workers who have seen reduced wages.

    An end to the strike would bring relief not only to union members who have lived for nearly a month on $250 weekly strike pay (which on Oct. 13 was bumped up to $275 weekly), but to dealers desperate for repair parts, suppliers waiting to fulfill orders and an auto maker that has hemorrhaged up to $100 million per day as its inventory has dwindled.

    GM's Detroit-Hamtramck plant, which was scheduled to end production in January, will remain open, according to the contract summary. However, the Lordstown Assembly plant in Ohio and transmission plants in Michigan and Maryland will be closed permanently. Workers from those plants will be offered several options for retirement bonuses, early retirement or buyouts of up to $75,000 and will not have to repay any relocation assistance they have already received.

     

    Nick Bunkley and Sarah Kominek, Automotive News, and Dustin Walsh, Crain's Detroit Business, contributed to this report.

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