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 The new deal, if ratified, would reshape the way in which UAW
workers at Fiat Chrysler are paid, gradually eliminating a
contentious two-tier pay structure.
UAW President Dennis Williams admitted he made some false steps that
helped lead to the landslide loss for a previous proposed contract
in a worker vote. The rejection almost led to a strike at Fiat
Chrysler's U.S. operations that was called off minutes before a
strike deadline late Wednesday night.
Williams said he misread the intensity for which lower-paid
second-tier workers wanted a clear path toward top pay rather than a
bridge closer to it, and he should have allowed more time before
holding the previous ratification vote.
Friday, in his first hours as marketer-in-chief for the new deal,
Williams told reporters in a telephone press conference, “It’s one
of the biggest contracts we’ve ever negotiated" with the company.
Several hundred of the UAW's local leaders from its branches, mainly
in the U.S. Midwest, met in Detroit on Friday. They gave the new
contract and its negotiators several spontaneous standing ovations,
Williams said.
It will take eight years from being hired to reach top pay rather
than a shorter period for UAW workers prior to the 2007 creation of
the two-tier structure.
A health care co-op to pool workers at the Detroit automakers, cited
as a reason for rejection of the previous proposal, is not included
in the new deal, Williams said.
The deal is now richer in that it raises the top pay for newer
second-tier workers to about $29 from about $19 currently, and from
the top pay of $25 proposed in the rejected contract.
Fiat Chrysler is financially the weakest of the Detroit Three which
also includes General Motors Co <GM.N> and Ford Motor Co <F.N>. Its
labor costs are lower than GM's or Ford's in large part because it
has a higher percentage of second-tier workers.
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Arthur Schwartz, a labor consultant and former GM negotiator, said
this proposal is richer and that he will be "stunned" if it is not
ratified.
"If (UAW members) don't vote for this, then their expectations are
too unrealistic and I don't know if they can get a contract at
Chrysler," Schwartz said after the highlights of the new deal were
released.
When UAW leaders sent the previous proposal to worker vote last
month, Schwartz said it would have a difficult time passing.
If ratified, fist-tier workers would get their first raises in about
a decade. They would get an immediate 3 percent raise from their
current pay of about $28, and another 3 percent in the third year,
along with lump sum bonuses of about $2,500 in years two and four.
The UAW said it agreed with the company to offer "retirement
incentive packages" at some plants, without mentioning which ones.
(Additional reporting by Sweta Singh in Bengaluru; Editing by
Christian Plumb, Bernard Orr)
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