Why the GM strike could last far into October


UAW Local 598 members sing during the 50th anniversary of the 1969 strike at Fisher Body Plant 2 in Flint while remembering that he had the longest strike in GM history.
Ryan Garza, Detroit Free Press

UAW and General Motors are far apart on several important issues that it may take a week or more to resolve before a tentative deal is reached, two people familiar with the talks told Free Press at Thursday.

It also means that the strike could last at least two weeks longer if the UAW follows a plan it considers keeping members of GM's stake lines will rank and vote to ratify the deal, as Free Press has reported.

Other people near the calls warned that breakthroughs could come quickly and speed up a resolution.

Meanwhile, the UAW leadership has instructed regional directors to meet leaders of the union population over the next few days to inform them of the talks, the sources said.

The trend came as both sides incur costs on Day 11 of the longest UAW strike since 1985. Anderson Economic Group, an East Lansing-based consultant, said Thursday that GM has probably lost $ 113 million so far, and is now losing money at the rate of $ 25 million a day. It said UAW members and workers at supplier firms now laid off a total of $ 266 million in direct pay.

Early Thursday, GM reversed a decision it made early in the strike that angered the union. It said it has now decided to pay health care costs for strikers instead of handing it over to the UAW. However, the union did not appear to be impressed.

About 46,000 GM UAW members have been on strike at GM's facilities across the country since September 16. The 2015 contract with GM expired at midnight on September 14. GM had made an initial proposal for a new contract two hours earlier, but UAW rejected it.

"About the big questions, we still have work to do," said Brian Rothenberg, UAW spokesman, late Thursday afternoon.

At GM, a spokesman declined to comment on the status of negotiations and reiterated the company's standard line, "We continue to talk, and our goal remains to reach an agreement that builds a stronger future for our employees and the company." [19659012] Members must see a good deal

Besides having several pending major issues, the UAW faces the challenge of making a tentative agreement that the Union membership will unambiguously ratify.

Terry Dittes, vice president of the union's GM department, seeks membership feedback. He is said to be determined to win a deal the membership will ratify, said one of the people familiar with the talks.

"There are those who have to live with it, and the UAW is fighting for an agreement that there is nothing explaining them, they either like it or they will not," the source said.

the negotiations are said to be numb and very focused. Although dealers have recorded every night, they said near the talks that the dealers are willing to do what it takes "and work a few hours to reach agreement.

But a resolution will be slow because both GM and UAW have high expectations that will require difficult trade-offs to make a deal that both can live with, said Marick Masters, director of labor at Wayne State University.

"The tentative deal they negotiate must be good enough to sell itself," said the masters. "The UAW leadership will not be able to sell an agreement that the membership will ratify because they will not trust the leaders."

It is because the talks are playing on the basis of a federal corruption investigation now Prosecutor Vance Pearson implied UAW President Gary Jones and immediate past President Dennis Williams in the abuse of union money.

But, said the masters, "The workers will stand up for each other and will stand up for au toworkers as a trade union. They are smart enough to separate the current Union leaders and their role in helping them. "

Unpublished matters

In a letter to members, UAW said Wednesday that" all unpublished proposals are now at the main table and have been presented to General Motors and we are awaiting answers. This will continue until negotiations are completed. "

These unpublished proposals were described on Thursday as important economic issues. These are the most important:

  • UAW workers' share of health care costs
  • Temporary workers
  • Salary increase
  • Build more product in the United States.

GM's first offer on September 14 to the UAW asked members to pay 15% of health care costs. They currently pay a total of 3%, far less than the average American worker's 28%. UAW appreciated GM's offer and the company went back to 3%.

But the topic is up for discussion, said one of the people familiar with the talks that raised questions for Free Press. GM again suggests that UAW members incur more of the cost of health care. GM said it pays about $ 900 million a year for US hourly workers' health care.

Another key issue is the use of temporary staff, this person said. UAW wants GM to create a process for a temporary worker to become permanent. Currently, some temps are on that status for years, earning less pay and benefits and getting no pay.

More: There is contract request # 1 from workers – and GM, UAW cannot agree on it

More: Why GM-UAW calls have taken so long

More: How GM's offer of profit sharing to UAW workers missed the mark

But GM wants to secure that ability to tap into a temporary workforce. Using lower paid temps saves money and gives GM the flexibility to reduce staff when the market slows down. By using more temps, GM could also be more cost-competitive with foreign companies building vehicles in the United States.

GM's average hourly labor cost in the United States is $ 63 per hour – this is not the hourly wage or wages plus benefits paid to individual workers, but rather the sum of all labor costs divided by all hours worked. But Honda, Nissan and Toyota spend about $ 50 an hour on American labor, according to Ann Arbor & # 39; s Center for Automotive Research. Japanese automakers usually employ more temporary workers than the Detroit Three.

Former Fiat Chrysler Automobile dealership Colin Lightbody said GM could save up to $ 500 million in future annual labor costs if it could get UAW members to pay for a larger portion of the health care system and bring in more temporary workers.

At the end of last year, GM had about 4,100 temporary workers, or 7% -10% of the workforce. If GM wants 20% -25% temporary workers in a new workplace mix and increases the amount workers pay for health care to 15% from the current 3%, it will be worth at least $ 5 an hour to reduce GM's labor costs to improve its competitiveness by Honda, Toyota and Nissan.

"That's a lot of money, which is why GM is willing to endure," Lightbody said.

Wages and Jobs

UAW members want a higher salary increase than the 2% originally offered by GM. In 2015, GM gave workers a 3% wage increase and a lump sum of 4%. A person familiar with the conversations said the two sides far from agree there.

Here is today's salary, according to UAW:

  • Temporary worker's salary: $ 15- $ 19.
  • A newly hired permanent production worker, called "in progress," earns about $ 17 an hour, which can increase to $ 28 an hour after eight years.
  • A heritage worker, an employee before 2007, earns $ 28- $ 33 an hour.
  • A skilled worker, about 15% of Detroit Tree's workforce, is closer to $ 35 to $ 36 per hour. They often get heavy overtime.

Finally, the UAW is pushing for GM to build more product in the United States and better resolve the alternatives to keep assembly plants in Detroit-Hamtramck and Lordstown, Ohio, the source said. [19659005IflastfallannouncedGoodswillopenaccesstotheUSplanteryear"notassigned"totheDefireincludesDetroit-HamtramckLordstownandtransmissionplantWarrenogBaltimore

GM's original proposal for a construction electric hammer and a electric pickup including a electric pickup GM also said they would invest $ 7 billion in US facilities and create or maintain 5,400 jobs. About half of these would be new jobs, Free Press reported.

Public opinion

The negotiations have taken place in the midst of distractions, especially after GM said it kicked health care into the union's $ 800 million strike fund, which also pays members' strike pay of $ 250 per week.

When GM turned course Thursday, "the reaction was kind of negative by our members," said a local UAW president who asked not to be named. "They feel GM is playing games now. The assembly line insurance is breaking your body to begin with, and many of our members have health problems."

Another local leader said at first that his members were "fired up" to But after Dittes, who heads UAW's side in negotiations with GM, noted in a letter Thursday to Scott Sandefur, GM's top retailer, that GM's "irresponsible actions" related to health care had "played" with the lives of UAW families, members felt less excited.

This leader said that GM's return to cover health care once again surprised UAW management, and indicated to him, "They are not talking to each other or communicating properly. So I don't believe any deal will be done soon. ”

Contact Jamie L. LaReau: 313-222-2149 or . Follow her on Twitter @ jlareauan . Read more on General Motors and sign up for our car newsletter .

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