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Detroit automakers have contracts done (finally)

Nov 22, 2015

UAW President Dennis Williams and GM CEO Mary Barra at kickoff of 2015 contract talks
Credit Jeffrey Sauger / General Motors

This summer, as contract talks with the Detroit Three kicked off, United Auto Workers President Dennis Williams warned that negotiations are "never easy."

He was right.

Last week, the union came within a hairsbreadth of having a contract with Ford Motor Company sent back by rank and file with a big "NO DEAL" stamp on its face. 

Voting by a number of big plants seemed poised to doom the contract.

Union leaders held a press conference on Wednesday, warning that if the contract was rejected, Ford might take back its commitment to invest $9 billion in its U.S. facilities. That investment was seen as key to securing current job levels in the U.S.

UAW and Ford executives at beginning of 2015 contract talks
Credit Tracy Samilton / Michigan Radio

A last-minute appeal to workers at the Rouge Complex in Dearborn saved the deal. It was narrowly ratified by 51.4%.

55% of hourly production workers at General Motors voted to ratify the contract, but skilled trades voted it down.

UAW leadership held meetings at each GM facility across the country to find out more about their concerns. That process led to the additional talks with GM to iron out those issues, the union said in its statement.

The union’s UAW-GM Council – made up of local chapter officials from around the country – decided in its meeting Friday that the changes would satisfy the skilled-trades workers' concerns, and leaders pronounced the contract ratified.

Fiat Chrysler CEO Sergio Marchionne and UAW President Dennis Williams at start of 2015 contract talks
Credit UAW

In September, the negotiations got off to a rocky start, when Chrysler workers rejected the first tentative contract.

Many analysts blamed poor communication from union leaders for the vote. Many workers also didn't like the idea of a joint GM-Ford-Chrysler health care co-op.

Workers approved the second contract, which dropped the co-op provision, but was not dramatically different than the first. It was, however, explained better. The union also called in a public relations firm to help with the communication effort.

Those workers who demanded the restoration of everything that was given up during the recession were disappointed.

The automakers will still hire new workers in at a much lower wage than veteran workers. 

There is profit sharing, but no automatic cost of living wage increases. 

And benefits like the long-term unemployment scheme known as the Jobs Bank, along with company-paid pensions are a relic of history, as both the automakers and the union leadership strive to keep labor costs from crippling Detroit's competitiveness with Japanese and Korean automakers.