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Ford Contract Facing Possible Rejection

Workers voting thumbs-down at key Ford plants.

by on Oct.13, 2011

Ford workers are giving a tepid reception to their new contract and could refuse to ratify it.

The final tally on the United Auto Workers ratification vote on the new contract with the Ford Motor Co. won’t be complete until next week. But the early numbers are proving be too close for comfort as an internet-driven “vote no” campaign takes hold.

Ford workers voted down contract changes in 2009 and dissidents have warned any new contract with Ford must recover the concessions made since 2007.

The tentative contract signed by the UAW and Ford doesn’t measure up to that standard, according to Gary Walkowicz, a UAW commiteeman from UAW Local 600, which represents thousands of workers at the Ford’s Rouge manufacturing complex. Walkowicz was one of the leaders of the fight against contract concessions in 2009. He is also urging a no vote on the proposed Ford agreement through a letter that been widely circulated on the internet.

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That message has led workers at several Michigan plants to reject the agreement, though it is winning support at a number of other Ford plants.

The press for rejection has been significantly stronger at Ford than at General Motors, where workers last month voted two-to-one to accept their own new agreement.

Union Facebook pages, including those put up by the UAW’s leadership, also have carried a large amount of negative commentary about the proposed agreement. The lack of pension improvements and the lack of any improvement in base wages are two key factors that have contributed to the discontent among workers.

“Ford is rolling in profits and Wall Street is tickled to see this contract. But we don’t even get the concessions back–from COLA, to Annual Improvement Factor, through apprenticeships,” notes a leaflet circulated inside the Rouge.

The internet also has provided union dissidents a powerful tool for organizing opposition. Meanwhile, the discontent has already forced King to alter the union’s strategy by putting more emphasis on improving the wages for second-tier workers. The agreement would eventually boost their pay to around $19 an hour, up from as little as $14 today.

A no vote at Ford would force the union back to the bargaining table with uncertain consequences because the negotiators will have to come up with a formula that will satisfy dissatisfied union members. A no vote also could set the stage for a strike, which King and Ford had hoped to avoid, though at this point that has to be considered an unlikely outcome.

Nonetheless, Ford is the only one of Detroit’s Big Three that could face just that sort of confrontation.  As a result of the federal bailouts given its crosstown rivals General Motors and Chrysler, the UAW is barred from striking those makers over economic issues.

The no vote at Ford could also set the stage for a no vote at Chrysler where workers only narrowly approved the current contract over some determined opposition. The smallest of the nation’s makers agreed to increase tier-two wages and offer a signing bonus to its UAW workers, but the up-front cash is significantly less than at Ford and GM.

(Click Here for the full story on the Chrysler settlement.)

The no votes also underscore a growing gap between the union’s executive board and the rank-and-file, which appears to be growing rather than narrowing. The number of active dissidents in the union’s ranks remains relatively small but their voices have grown steadily louder over the past four years.

For Ford, rejection could create a variety of problems. It would force the maker back to the bargaining table, potentially resulting in higher labor costs.  It could also scuttle a key target of CEO Alan Mulally who had been hoping to boost the maker’s debt rating to investment grade. Moody’s had upgraded GM based on its agreement with the UAW — and had suggested it would do the same for Ford following ratification.

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3 Responses to “Ford Contract Facing Possible Rejection”

  1. r123t says:

    Mistake on the rank-and-file’s part if they reject the contract. Major mistake. And after reading Vlasic’s new book, I’m beginning to think the Ford workers have no feeling for how lucky they have been over the last five years, vis a vis GM and Chrysler, as far as good will from the public. I would counsel patience for the Ford workers, no matter how much money Mulally gets.

    • Paul A. Eisenstein says:

      I think that if the UAW workers at Ford reject their pact they are in for serious problems. Among other things anticipate no chance of organizing the transplants at any time in the near to mid-term.
      Paul E>

  2. aircavalry says:

    I don’t believe they are going to reject the contract.

    It’s fun to speculate, but in the end I see the contract being ratified and the Union, not growing much (not sure how successful they will be with transplants) but stabilizing.