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DETROIT, Oct 29 (Reuters) – United Auto Workers President Shawn Fain is meeting Sunday afternoon with local union leaders from Ford (F.N) to start the process of ratifying a new contract, while bargaining continues at General Motors (GM.N) following a setback Saturday.
Fain on Saturday ordered a walkout at GM’s Spring Hill, Tennessee engine and assembly plant, criticizing management’s “unnecessary and irresponsible refusal to come to a fair agreement.”
It is not clear what derailed GM and the UAW’s progress toward an agreement patterned after earlier deals at Ford and Chrysler-owner Stellantis (STLAM.MI) but sources said one key issue was retiree pension costs. Those deals won workers a record 25% jump in wages over the 4-1/2-year contract and allowed the automakers to restart their profitable truck assembly lines.
The Ford UAW deal includes a $5,000 ratification bonus, special retirement incentive packages and gives newly-hired temporary workers a faster path to full-time status and the top union pay rate, according to a summary document seen by Reuters. Workers also get a $1,500 voucher toward a vehicle purchase and heftier company contributions for retirement benefits.
Existing Ford temporary workers immediately become permanent employees on track for top pay within three years and the deal creates a pathway for workers at joint ventures, battery plants, and Ford’s BlueOval city electric vehicle complex in Tennessee to join the union, and be covered under the master contract, sources told Reuters.
GM and Ford shares have fallen roughly a fifth since the beginning of the strike on Sept. 15. Stellantis shares are down just 1%.
GM said it was disappointed by the UAW decision to strike Spring Hill.
The Spring Hill walkout could hobble GM’s large pickup production as well as assembly of other popular GM vehicles. Ripple effects from an extended Spring Hill strike could boost the costs of the stalemate for GM well beyond the $400 million a week the company reported last week.
UAW counsel Benjamin Dictor on Sunday morning posted on the social media site X, formerly known as Twitter: “All my homies hate companies that won’t agree to fair contracts for their workers.” He later deleted the post.
GM is now the only Detroit automaker without a deal. Stellantis reached agreement with the UAW on Saturday and Ford on Wednesday.
United Auto Workers union President Shawn Fain joins UAW members who are on a strike, on the picket line at the Ford Michigan Assembly Plant in Wayne, Michigan, U.S., September 15, 2023. REUTERS/Rebecca Cook Acquire Licensing Rights
Progress toward resolving the disputes between UAW and GM could slow on Sunday because Fain is scheduled to attend meetings with Ford local officials in the Detroit suburb of Taylor, Michigan, and give a video update on the Ford deal at 7 p.m. ET (2300 GMT).
Union leaders will then fan out to regional meetings to explain the deals to members, who will then vote on whether to approve it.
UAW leaders no longer can take ratification votes for granted. Last month, UAW workers at Mack Truck’s U.S. operations overwhelmingly rejected a deal recommended by Fain, while Mack said Thursday no new talks are scheduled. In 2015, UAW members at what is now Stellantis voted down a contract endorsed by union leadership.
Fain said on Saturday that local union leaders at Stellantis plants will come to Detroit on Nov. 2 before the agreement is sent to members for ratification.
BIG CHECKBOOK
Fain has been especially tough on Ford through the contract negotiations, despite the automaker having cultivated a collaborative relationship with the UAW in the past.
At one point, he told Ford Chief Executive Jim Farley to “Go get the big checkbook,” declaring that the “days of the UAW and Ford being a team to fight other companies are over.”
In addition to the hike in general wages, Fain has said the lowest-paid temporary workers at Ford would enjoy raises of more than 150% over the contract term and employees would reach top pay after three years. The union also won the right to strike over future plant closures.
The UAW also succeeded in eliminating lower-pay tiers for workers in certain parts operations at Ford – an issue Fain highlighted from the start of the bargaining process.
The Ford contract would reverse concessions the union agreed to in a series of contracts since 2007, when GM and the former Chrysler were skidding toward bankruptcy, and Ford was mortgaging assets to stay afloat.
“We told Ford to pony up and they did,” Fain said in a video post last week.
Reporting by Joe White in Detroit and David Shepardson in Washington; Writing by Sayantani Ghosh; Editing by Lisa Shumaker and Deepa Babington
Our Standards: The Thomson Reuters Trust Principles.
Jessica Roberts is a seasoned business writer who deciphers the intricacies of the corporate world. With a focus on finance and entrepreneurship, she provides readers with valuable insights into market trends, startup innovations, and economic developments.
