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GM, UAW Settle Minutes Before Strike Deadline

Four-year contract expected to largely mirror Fiat Chrysler agreement.

by on Oct.26, 2015

Handshakes and smiles marked the opening of GM-UAW contract talks last July. Shown in front: GM CEO Barra, UAW Pres. Williams, GM negotiator Cathy Clegg and UAW bargainer Cindy Estrada.

General Motors and the United Auto Workers Union reached tentative agreement on a new four-year labor contract Sunday only minutes before the UAW’s midnight strike deadline.

While neither side would discuss details before a meeting of the union’s rank-and-file plant leaders, it was expected the tentative contract would adhere closely to the so-called “pattern” agreement at Fiat Chrysler that won worker approval last week.

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“We believe that this agreement will present stable long-term, significant wage gains and job security commitments to UAW members now and in the future,” said UAW President Dennis Williams. “We look forward to presenting the details of these gains to local union leaders and the membership.”

(GM to add 1,200 new jobs at Detroit plant. Click Here for more.)

The union bargaining committee announced the settlement 11:43 PM Sunday only 16 minutes before the 11:59 strike deadline that had been imposed by the UAW the day before. In short order, the UAW bargaining committee unanimously voted to send the proposed tentative agreement later this week to local union leaders who make up the UAW National GM Council.

If that group gives its approval, the contract will then go to the 52,500 GM workers represented by the UAW in the U.S.

The UAW had threatened to call a strike at GM at midnight.

Details are being withheld pending the meeting of the GM council but the contract is expected to closely parallel the union’s agreement with FCA, which included a 53% pay increase for second-tier workers who will reach parity with veteran employees after eight years. The FCA contract also called for first-tier workers to get a 3% pay increase, their first in nine years.

The union plans to make the details of the GM agreement available immediately after the UAW National GM Council votes on the tentative agreement Wednesday and will have no comment until that time, the UAW said.

But union Vice President Cindy Estrada called the agreement “transformative,” as it gives tier-two members a clear path to wage and benefit parity.

“The significant gains in this agreement are structured in a way that will provide certainty to our members and create a clear path for all GM employees now and in the future,” she declared. “The agreement not only rewards UAW-GM members for their accomplishments, but it protects them with significant job security commitments.”

For its part, GM said the tentative agreement was a positive development for both the company and the union.

“The new UAW-GM national agreement is good for employees and the business,” said Cathy Clegg, GM North America Manufacturing and Labor Relations vice president. “Working with our UAW partners, we developed constructive solutions that benefit employees and provide flexibility for the company to respond to the needs of the marketplace.”

There had been some concern among industry watchers that the UAW might demand an even sweeter package from GM to reflect the strong profits the company has been delivering.

(Second time the charm for Fiat Chrysler and UAW. Click Here for the story.)

Fiat Chrysler workers rejected the initial settlement they received in mid-September, in part due to the continuation of the company’s two-tier wage system. But FCA also had to sweeten the pot to win approval of a second contract offer.

If the new GM agreement is approved, UAW negotiators will quickly move on to Ford Motor Co. in a bid to wrap up this year’s contract talks. The second-largest domestic automaker has said it would try to negotiate an agreement reflecting its own situation, rather than accepting a pattern contract. But with Fiat Chrysler and GM now in a position to maintain labor peace for the next four years, Ford may have no choice but to accept a similar contract, observers contend.

(Paul A. Eisenstein contributed to this report.)

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