Tag Archive | "United Auto Workers"

Ford Executive Indicates Desire for Level Playing Field on Labor Costs

Ford Motor Co’s Americas chief indicated on Wednesday that the No. 2 U.S. automaker will be looking to bring its labor costs in line with those of its smaller rival Fiat Chrysler Automobiles when it opens talks this summer with the union representing its hourly workers, reported Reuters.

Joe Hinrichs, speaking at a Bank of America Merrill Lynch conference, said the subject of entry-level workers, who are paid less than their veteran co-workers, will be a subject of talks with the United Auto Workers. Ford, Fiat Chrysler and General Motors Co will negotiate new deals to replace ones expiring in mid-September.

Hinrichs, who declined to discuss the pending talks in detail, said Ford needs to remain competitive in order to maintain its investment in U.S. plants, and pointed to the UAW’s desire for a deal that is similar at all three automakers in helping Ford lessen the advantages Fiat Chrysler gained during its 2009 bankruptcy.

As part of the bankruptcy reorganizations at GM and FCA, the UAW agreed to no cap on the number of entry-level workers those automakers could hire, while Ford, which did not enter bankruptcy, has a limit.

“Ideally, some of those discrepancies that exist because of the bankruptcies at two of our competitors will play themselves out as part of that pattern bargaining process,” said Hinrichs, who added the talks would be a “delicate balance.”

Asked what Hinrichs meant, a Ford spokeswoman said, “We need to have a total labor cost that is competitive with other automotive manufacturers producing in the U.S. We’re open to discussing many options with our UAW partners.”

Entry-level workers earn about $16 to $19 an hour compared with veteran workers, who make up to $28.50 an hour. Twenty-eight percent of Ford’s hourly U.S. workforce are entry level, while GM is at 19 percent and FCA is at 43 percent.

UAW leaders have said they want to bridge the gap between the entry-level and veteran workers’ pay.

Labor cost estimates show that Ford pays its workers an average of $57 an hour, including benefits, compared with $58 at GM and $48 at FCA, according to the Center for Automotive Research.

“There’s certainly an understanding that for the investment levels to continue and the great job growth numbers that we’ve had in the U.S. to continue, we have to maintain a level of competitiveness that makes sense,” Hinrichs said.

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UAW’s Williams: ‘No More Concessions’

Detroit — Newly elected United Auto Workers president Dennis Williams urged members Thursday to join the fight to “take back” the country that has been “handcuffed by extremists,” reported The Detroit News.

Williams, 61, elected Wednesday to replace outgoing president Bob King, also said its time for the union to stand up and accept no more concessions in negotiations with corporations.

But during his 30-minute speech in front of more than 1,000 elected union delegates, Williams did not specifically mention eliminating the controversial two-tier wage system — one of the top reasons many delegates said they voted for the former Marine.

The new UAW president addressed the subject during a press conference later in the afternoon, reiterating a previous statement that he wants to “bridge the gap” of the two-tier wage structure.

He also announced the assignments for his three vice presidents: Jimmy Settles will oversee Ford Motor Co. and aerospace; Norwood Jewell will negotiate with Chrysler Group LLC, General Dynamics and agriculture and heavy truck companies; and Cindy Estrada will head the team that bargains with General Motors Co., parts suppliers and independent companies. Estrada, who is the first Latina UAW vice president, downplayed the fact she will negotiate with GM, which is headed by the auto industry’s first female CEO, Mary Barra.

Gary Casteel, the newly-elected secretary-treasurer, will handle the union’s finances, transnational organizing, and Mitsubishi Motors. Casteel said Thursday he will continue to live in Tennessee to continue his focus on organizing auto plants in the south, including Volkswagen AG’s Chattanooga, Tenn., facility, which earlier this year the UAW narrowly lost out on organizing.

Williams, during his speech, sent a strong message to companies — including the Detroit automakers — that he will expect them to share more of their recent profit gains with union members.

“It’s time for each and every one of us to tell our corporations no more concessions,” he said. “We’re tired of this.”

“I don’t want anybody to misread what I’m saying; I want to work closely with the companies as long as it doesn’t hurt our members. I also want to tell them, I do not like confrontation, but I am not afraid of confrontation.”

Detroit automakers in 2007 pushed for the two-tier wage system as a way to cut costs.

Veteran workers make about $28 an hour, but newer workers, doing the same job have a starting wage about half that amount and their top hourly pay is capped at $19.

Chrysler and Fiat SpA CEO Sergio Marchionne has said he wants to end the two-tier wage structure, and recently said he wants to begin negotiating a new contract with the UAW this month — more than a year before the current contract with the union ends. But Williams said Thursday the union isn’t quite ready to sit down at the bargaining table.

Williams expressed the need for better communication within the union, something officials tried to improve on when discussing the recent union dues hike, which passed Tuesday. Union members in August will begin paying dues equal to two-and-a-half hours of monthly pay, up from two hours.

Union officials for more than six months floated the idea of the dues increase and visited local union shops to gather the opinions of members.

“How can we be good stewards of our union if we’re not communicating and educating?” Williams asked, adding that “if we can’t talk to our members about what we’re doing, perhaps we shouldn’t be doing it.”

Williams urged members to vote in upcoming elections — including Senate and House races and the presidential race in 2016.

“This country better be careful,” he said. “If we want to keep our freedoms, you have to fight for them.

“The great equalizer in this country is our vote.”

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Proposed Dues Hike Divides UAW

United Auto Workers delegates are expected to vote Tuesdayon a controversial dues hike, and some members on Monday staged a last-ditch effort to derail the first increase in more than four decades, reported The Detroit News.

But halting the hike likely hinges on scoring an important on-the-record roll-call vote, rather than a voice vote, they say, because the dues increase is a union-backed proposal.

Getting that roll-call vote requires the support of 307 delegates — roughly one-third of the 1,100 attending this year’s convention. Dissenters, at a meeting following the conclusion of the convention’s first day, said they are looking to end the UAW’s “social club” mentality and prevent a “slap in the face” with any dues increase.

UAW President Bob King said the dues vote will take place Tuesday, ahead of Wednesday’s election of the next union president, which is presumed to be current secretary-treasurer Dennis Williams.

The possible 25 percent dues hike — the union’s first since the 1960s — is “opposed by a large majority” of UAW members, Gary Walkowicz, bargaining committeeman at Ford’s Dearborn Truck plant and the lone challenger to the union-endorsed Williams, said in a flier distributed on Monday to delegates.

Walkowicz said he’s not looking to have the proposed dues hike struck down this week. His goal is to have each of the union’s 391,415 members — instead of delegates — vote to decide whether to pay two-and-a-half hours’ worth of monthly pay, up from to two hours.

“It’s not primarily about the money,” Walkowicz said. “It really goes back to disagreeing with the leadership.”

For a veteran autoworker making $28 an hour, the increase would cost $14 a month, or $168 a year. Newer union members in the lower $14-an-hour wage tier would pay half that amount.

Some union members are pushing back against the UAW, and already are peeved that the union spent millions of dollars on recent political efforts, including the attempt to organize Volkswagen workers in Chattanooga, Tenn., and fighting Michigan’s 2012 right-to-work law. They believe union spending is out of control; one example cited Monday was the union’s insistence on spending hundreds of dollars per delegate to house them at a nearby hotel — even those who live and work in Metro Detroit.

The International UAW said it’s not responsible for the hotels of members who live in the local area.

UAW officials insist the union needs the extra money to boost its strike fund.

The fund once totaled about $1 billion but today is down to about $600 million, outgoing UAW President Bob King said Monday. King has said a larger strike fund will send a message to companies to bargain in good faith.

“If we vote here for a dues increase, it will deter more members from staying with the union,” Walkowicz said, referencing the choice for some workers to opt out of paying union dues if they reside in right-to-work states such as Michigan.

King said Monday he expects workers to remain dues-paying members even if the dues hike passes, citing six months of discussions with members. He would not speculate on how close he expects Tuesday’s vote to be.

Some workers are convinced eliminating the UAW’s two-tier wage system — which pays new employees half of what their veteran counterparts earn — and gaining raises for those veteran workers is an easier way to boost revenue.

About 30 union delegates and members attended the Monday afternoon meeting. At least two indicated that seven other union members at their home plants have committed to voting against the 25-percent hike.

The dissenters acknowledge their chances to shoot down the increase are slim.

“The roll call is going to be important to get the votes on record,” said Scott Houldieson, a delegate from Local 551, which represents workers at the Ford Chicago Assembly Plant. “Those who vote for a dues increase will put their union positions further down the road in jeopardy.”

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UAW wants to eliminate two-tier wage system

(Reuters) – A top official with the United Auto Workers said the American labor union wants to eliminate the two-tier wage system that pays new automotive workers at a lower rate than veterans.

Norwood Jewell, nominated to serve as one of three vice presidents when the union meets next June to ratify its new leaders, said that the UAW wants to dump the two-tier scale that pays entry-level hires at slightly more than half the rate of veteran workers.

“The international executive board hates two-tiers,” he told reporters at a General Motors Co plant in Flint, Michigan. Jewell is currently director of the region that includes the GM plant. “We didn’t do two tiers because it’s a wonderful thing,” he added, saying they were a “financial unfortunate” caused by the weak industry in 2007. “We hate them. We intend to eliminate them over time.”

The UAW will negotiate its next labor contract with the U.S. automakers, GM, Ford Motor Co. and Chrysler Group, which is controlled by Italy’s Fiat, in 2015. Strong profits at the U.S. automakers, combined with the UAW’s distaste for two-tier wages and the fact that veteran workers have not received a pay raise in a decade, point to difficult labor talks.

The American automakers have said they need the entry-level wage scale to compete on labor costs with Japanese, South Korean and German automakers that have U.S. plants.

Pay of hourly workers at the entry level starts at just under $16 an hour and rises over time to more than $19. Veteran workers are paid just more than $28 an hour.

About 16 percent of GM’s 51,500 hourly U.S. employees are second-tier workers, while 19 percent of Ford’s 46,500 hourly workers are paid at that level. About a quarter of Chrysler’s 32,000 hourly workers are entry-level.

Jewell said key to eliminating the second-tier wages will be the UAW successfully organizing non-union plants in the U.S. South. “If we don’t organize them and bring them up to our standard, we’re never going be able to totally eliminate the second tier,” he said.

The UAW has been negotiating to organize Volkswagen AG’s assembly plant in Chattanooga, Tennessee, through a German-style labor council.

Asked whether the union expects to recoup some of the givebacks it made in the last round of talks in 2011 with the now-profitable U.S. automakers, Jewell said a strong economy would help the union’s case in the next contract negotiations.

Jewell also said he expects the union’s strong relations with GM to continue even as the No. 1 U.S. automaker transitions to a new chief executive next month. Last week, GM said CEO Dan Akerson would be replaced by product development chief Mary Barra, the industry’s first woman CEO.

He also noted that any move to raise union dues would be decided by the membership at the convention next June. The UAW is considering hiking membership dues by 25 percent, the first increase since 1967, as it faces dwindling membership and rising costs, sources and a union official said this month. Jimmy Settles, UAW vice president and the top union official for workers at Ford said the increase was only in the discussion phase and no decision had been made.

The UAW has faced dwindling membership since 1979, when U.S. automakers dominated the domestic car market and before the widespread use of robots and other manufacturing efficiencies cut the need for as many assembly line workers.

UAW membership sunk to 355,191 in 2009 at the depths of the U.S. recession but while U.S. auto sales have increased nearly 50 percent since then, union membership has risen 8 percent.

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UAW Says Chrysler Workers Approved Contract

Chrysler Group LLC workers approved a new four-year labor contract with the auto maker, the United Auto Workers union said on Wednesday.

The agreement passed with 54.8 percent of all those who voted favoring the deal, the UAW said. Ratification required the endorsement by simple majority of those voting, reported The Wall Street Journal. Skilled trade workers, a subset of union members, rejected the contract with 55.6 percent voting against the deal, the UAW said.

The rejection by skilled trade workers sent the UAW leadership scrambling Tuesday night and Wednesday. In the end, the UAW said it investigated the concerns voiced by the skilled trade and decided to ratify the agreement based on its constitution, which requires a simple majority of those voting for approval.

“You want to protect the rights of the minority but you can’t let the minority override the majority,” UAW President Bob King said in a conference call following the ratification. He said skilled workers could appeal the vote through the Public Review Board, an independent group established by the UAW.

The last-minute split vote was the final piece of drama in the Chrysler and UAW talks, which included two deadline extensions and an angry letter from Chief Executive Sergio Marchionne to Mr. King after the two failed to reach an agreement before the contract was due to expire Sept. 14.

Dissatisfaction with the contract, especially a signing bonus that is to be paid in two parts, was apparent throughout the week-long voting process with some union locals voting against the contract. Other members protested by not voting at all.

“The money was a big issue,”Mr. King said. “The Chrysler workers saw their brothers and sisters at Ford Motor Co. and General Motors Co. getting a lot more money and in one lump sum,” he said. “I think that made a dramatic difference.”

Chrysler’s agreement provides a signing bonus of $3,000 with $1,750 to be paid once the contract is ratified and the remaining amount due after Chrysler returns to financial stability. There is also a bump in the hourly wage for entry-level employees. Chrysler, meanwhile, won’t increase pay for veteran workers or offer a cost-of-living adjustment.

GM workers received a lump sum $5,000 bonus following ratification while Ford workers received $6,000.

Chrysler was the last of the U.S. auto makers to settle its labor contracts. GM and Ford contracts received majority approvals despite some UAW locals turning down the accords.

The auto makers are now expected to begin advancing projects they had held back pending contract ratifications. They include expanding capacity, reactivating plants or moving assigning future vehicle production to different U.S. facilities.

Ford is planning to add some of its Ford Fusion production to its Flat Rock, Mich., plant, while Chrysler intends to add new vehicles to the Sterling Heights, Mich., factory and General Motors will reopen its former Saturn plant in Spring Hill, Tenn.

Separately, Mr. King said a grievance filed by the UAW against Ford is set to go to an arbitration hearing on Nov. 17.

The grievance claims the auto maker violated an agreement to treat both the salaried and union workers equally after Ford gave its salaried employees raises and reinstated 401(k) matches before union workers last year.

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Ford Says Wage Gains to Be Small

Ford Motor Co. said its total annual labor expenses will increase less than 1 percent over the four-year term of its new contract with members of the United Auto Workers union.

The contract’s lump-sum payments to workers, including a $6,000 bonus to be paid to each of Ford’s 41,000 UAW workers for ratifying the contract, will cost Ford $280 million this year, company officials said on Thursday in a presentation to analysts. The bottom-line impact of lump-sum payments will be $80 million this year and about $80 a year in each of the next four years, the company said. Other changes and benefits in the contract will lower Ford’s labor costs by $10 million this year and $20 million next, Ford said.

Costs of the contract will “be more than offset by improvements in manufacturing flexibility,” said Mark Fields, president of the Americas for Ford.

Changes include adding flexibility to plants and other steps to increase productivity, according to The Wall Street Journal. Structural costs are not anticipated to increase materially over the period of the contract, said Lewis Booth, the chief financial officer.

Ford plans to hire 12,000 new workers over the course of the contract. If U.S. sales of vehicles stays at current levels or increases slightly, Ford said it still plans to hire most if not all of the workers based on the current need, Mr. Fields said. Ford’s 41,000 hourly workers ratified a new four-year contract this week with 63 percent vote in favor of the contract.

Ford was the most vulnerable of the three Detroit auto makers because its previous contract didn’t have a “no strike” clause that was included in contracts held by General Motors Co. and Chrysler Group LLC.

Ford said it will invest a total of $16 billion in the U.S.—$6.2 billion directly in plants—through 2015. It also raised the entry-level and top-end wage for newly hired workers, a key goal of the UAW to begin to close the gap in wages between long-time employees and new ones.

Ford is planning to buy out skilled tradesmen for as much as $100,000 a worker. Ford said it would like to reduce the number of tradesmen by between 900 and 1,000 from the 9,000 it now has, said John Fleming, group vice president of manufacturing and labor affairs.

Mr. Fleming told analysts that by the end of 2015, Ford’s U.S. work force would be composed of around 8 percednt of so-called “second-tier” workers who make a lower starting wage.

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