Skip to main content

Ratification next step for 4-year GM-UAW contract

General Motors Co. (NYSE:GM, TSX: GMM) and the UAW shook hands on a four-year contract late Friday, giving GM's rank and file their first pay raises in eight years. While terms of the General Motors-UAW deal weren't immediately disclosed, Reuters reported that 48,500 unionized GM workers would get $5,000 "signing bonuses" and that at least 570 laid-off workers would be re-employed.


Auto workers are glad there was no drama attached to the 2011 negotiations. The UAW is saying, in broad terms, that pensions and health care programs either were improved or remained no worse than they are now.

"You didn't hear anything about any adversarial disagreements at the bargaining table," Tim Shoup, who has worked for General Motors at Flint Truck Assembly for almost 40 years, told the Flint Journal in an interview today.

"It seems like they've cut costs and productivity has improved a lot and there seems to be a greater cooperation between the union and management than there was years back. There seems to be greater give and take."

Settling this contract with the UAW as quickly as possible made sense for General Motors, which is enjoying a financial boon. GM earned $4.7 billion last year, its best annual showing in 11 years. And so far this year the Detroit automaker has turned a $5.7 billion profit. The union and the company both want to keep that momentum going. GM stock closed Friday at $22.61 a share.

Union contracts are still being negotiated with the two other members of the Detroit Three, Ford Motor Co. and Fiat's Chrysler Group. Including GM's crew, there are 112,000 U.S. auto workers from the three American companies who work under the aegis of the UAW. The union's negotiations with GM began in July and concluded in under two months, two days after the old contract was extended.

Auto workers like John Harris remain skittish. Until the details come out, he's going to be nervous about the big picture.

"I hope it's a good (contract for GM workers) for us Ford workers' sake," Ford worker Harris said on a UAW Facebook page in response to the union's announcement that the agreement with General Motors was reached. "Not to mention for the Chrysler brothers and sisters."

Late Friday, GM released a carefully worded statement that praised both sides for providing union workers with job security. But the remarks were vague and avoided specifics.

"We used a creative problem-solving approach to reach an agreement that addresses the needs of employees and positions our business for long-term success,” Cathy Clegg, GM vice president, Labor Relations, said in the statement.

"We worked hard for a contract that recognizes the realities of today’s marketplace, enabling GM to continue to invest in U.S. manufacturing and provide good jobs to thousands of Americans.”

GM has invested more than $5.1 billion and created or retained almost 13,000 jobs in its U.S. manufacturing plants since August 2009, a spokeswoman said. The Associated Press reported this morning that GM has confirmed plans to invest $2 billion more than that in 17 U.S. factories in the next year and a half.

Also in the works is the reopening of an idled Saturn factory in Spring Hill, Tenn., where GM could begin assembling the Chevrolet Equinox and GMC Terrain to keep up with hot demand for those models. At minimum, 2,000 new jobs could go to Tennessee and to existing plants in Missouri (Wentzville) and suburban Detroit (Warren and Romulus), Gannett newspapers in Detroit and Nashville reported today on their Web sites. GM is already adding 500 new jobs to Spring Hill's engine assembly section, which is separate from the shuttered auto assembly plant.

Contract specifics were withheld to allow the UAW International union to go over everything with its membership. That process begins on Tuesday. A ratification vote is needed before the contract takes effect. This should happen within 10 days.

But the New York Times, quoting an unnamed union source, reported today that the contract includes "improved profit-sharing" and “significant improvements to health care benefits.” This year UAW members at GM earned $4,400 each in profit sharing. The union also is expected to have persuaded GM to boost hourly pay for entry-level auto workers by up to $3 per hour, to about $17 hourly. GM and the union declined to confirm that.

The Wall Street Journal, citing an interview with UAW President Bob King (pictured), reported early today that GM agreed to bring "workers back ... from layoff status, create new jobs at the company and bring back jobs from overseas to car factories in the U.S."

King, in a statement, said President Obama played a role in GM and the UAW reaching an accord because he helped create conditions for success. "Let's be completely clear about this: None of this would have been possible without the efforts of President Obama, who invested federal funds to help turn the company around, protect the auto supplier base and keep good-paying jobs in America."

The auto union made the announcement of the settlement on a Facebook page. GM issued a short statement on its media Web site at about the same time but as of early today had not posted anything on its Facebook page to acknowledge the agreement.

In a statement on a Facebook page, the union announced the contract this way: "The UAW and General Motors reached a tentative agreement at approximately 11 p.m. on Friday, September 16, 2011. Details of the proposed agreement will be released after UAW members have had an opportunity to review them."

Shortly after that, a UAW negotiator said GM auto workers will get what they deserve. "When GM was struggling, our members shared in the sacrifice. Now that the company is posting profits again, our members want to share in the success," UAW Vice President Joe Ashton, the chief negotiator with GM, told reporters.

The UAW-GM Facebook page was a hot forum heading into today's wee hours. Within four hours of the announcement, 107 people had either LIKED the news or had made a public comment about it. The online posters were relieved that a deal had been reached.

Todd Anderson was the first to respond to the news. He said: "Congratulations to the UAW. Go brothers and sisters!"

Josh Oliver wants GM to bring back displaced workers. "I hope you bring us temps back that worked at closed GM plants. We paid union dues too and you've done nothing for us! I thought we had a voice?"

Debbie McIntosh is just glad a deal is done. Her reaction: "FANTASTIC!"

Dan Tyler thinks both sides benefited. He predicts "they secured better benefits, strengthened retirement and are bringing jobs back to the U.S."

Chuck Martin is ready to help co-workers. "I'll take an early retirement offer so GM would hopefully hire the temps permanent and give the Tier 2 people a raise ... wishful thinking ;)."

Carla Harbert said she is grateful the wrangling is over. "I sincerely thank the UAW and GM for giving me YEARS of a great life for my family. My grandfather is a GM retiree, my father is a GM retiree, my husband is still currently working at the local GM plant in Parma -- and I am very proud of being an auto worker wife!"

Hawke Fracassa covers the automotive industry from Detroit for TN. He can be reached at [email protected] and (248) 747-1550. Or follow him on Twitter @HawkeFracassa.

Image source: Wikipedia

To read about what's next on Tuesday in Detroit, CLICK HERE:

To read how, why reopening Spring Hill plant makes sense for GM, UAW, CLICK HERE:

To read about a car that is iconic to the Saturn plant in Spring Hill, CLICK HERE:

To read about the money GM's UAW members will get, CLICK HERE:

For more automotive news, CLICK HERE: