UAW President Bob King

UAW-Chrysler contract bargaining back in session

Chrysler Group LLC and the UAW resumed bargaining this morning after taking time off Monday to rest after days of round-the-clock negotiations on a new four-year contract left negotiators close but short of an agreement, and exhausted.

Negotiators are worn out from bargaining that has taken a toll on them not only from long hours but also from sessions that run sometimes into the middle of the night, when the rest of America is sleeping.

But in a Facebook post today to Chrysler's 26,000 UAW members, the bargaining team said: "Today is a new day. We are rested, focused and ready to get down to business."

While UAW President Bob King says "substantial progress" has been made" and the two sides "are still working toward an agreement," the i's have not been dotted and the t's not crossed yet. King's resolve: "We hope to have one by Wednesday."

One complication is job importation. The UAW persuaded General Motors Co. and Ford Motor Co., the two bigger members of the former Big Three, to siphon auto worker jobs from foreign countries like Mexico, Japan and China so they can bring them back to the United States as part of a job security and job growth initiative pushed for by the union.

Thousands of Americans will be hired, recalled from layoff or have their current positions protected because of these contracts won for the workers by King and his vice presidents. But at Auburn Hills, Mich.-based Chrysler Group LLC, fulfilling that same demand might get sticky.

This is because Chrysler's largest stakeholder is Italian carmaker Fiat. Chrysler CEO Sergio Marchionne also is CEO of Fiat SpA, and he is being pressured by a metalworkers union in Italy to keep jobs in Italy. A one-day protest strike is planned for Oct. 21 at Fiat factories to send a message to Marchionne that Fiat should not take jobs from Italians to give to North Americans in Mexico and the United States. A 4-door automobile engineered by Fiat is scheduled to be assembled at a Chrysler plant in Sterling Heights for the 2013 model year.

Since GM's pact is done and Ford Motor's has been approved by union leadership and will be approved or rejected by the membership when ratification voting concludes on Oct. 19, the UAW is trying to close out its deal with Chrysler so it can make a move to unionize transplant auto workers in the South and West.

King briefed shop chairmen and other union bigwigs from UAW Chrysler locals in Warren for about a half hour on Monday and will hold court again Wednesday if details with Chrysler bargainers can be ironed out today. There is always the possibility of Chrysler and the UAW going to arbitration, but both sides say they would rather not, all things being equal.

The financials are likely to be different for Chrysler than the cookie-cutter deals the union cut with GM and Ford Motor, which were motivated to share the wealth because they're making money hand over fist right now and don't want to halt the momentum of their profits. Chrysler is on a see-saw ride financially and Marchionne wants the new pact to reflect that economic uncertainty in cash flow by allowing more entry-level auto workers to be hired and being more conservative with any payouts than GM and Ford Motor were this contract-negotiation go-round.

Marchionne contends Chrysler's financial foundation is underfunded compared with the other Detroit Three companies because it has had to dig out from a financial mess created by former owners. Marchionne seeks lower bonuses than that being paid out to auto workers by his more well-heeled GM and Ford Motor competitors and a little bit more help with co-pays for health benefits, if he is able to get that.

“Some of the deals that we’ve seen being signed between Ford and GM are probably, given Chrysler’s own predicament … overly generous,” Marchionne has told reporters.

For its part, the UAW has been consistent. It has tried from go to use a "pattern" approach of creating similar pay and benefits for unionized auto workers at all three of the companies. At GM it won entry-level workers raises to almost $20 an hour, up a few dollars hourly from the previous rate.

If the UAW and Chrysler butt heads and reach an impasse, a contract will come to pass via arbitration since the union is not allowed to strike under the terms of a 2009 bailout loan the federal government gave to Chrysler. As part of that deal, the UAW is in the unusual position of being a part-owner of Chrysler for now, and unable to strike itself.

You can reach TN's Hawke Fracassa at [email protected] or (248) 747-1550. Follow him on Twitter @HawkeFracassa.

Image source: Wikipedia

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It will be interesting to see how these negotiations workout.