“They are the weakest party”, said Arthur Wheaton, professor of labor at Cornell University”. “The UAW has to get an agreement that will pass Fiat, otherwise it’ll blow up their pattern”.
Ford said Monday the UAW agreed to extend the current contract.
The UAW announced indefinite contract extensions with Ford and GM on Monday.
All three companies officially kicked off bargaining for new four-year contracts in July. Fiat Chrysler’s tentative agreement could be shaped in favor of the company and getting a contract with a high tier-two membership approved, according to Dzicezk. The move also dodges the union’s tradition of negotiating with the strongest company to extract the best terms for its members.
The bargaining teams for the UAW and all three automakers met separately throughout the weekend and are expected to continue talking today.
The smallest and least profitable of the Detroit Three, Fiat Chrysler has far less wiggle room to grant pay increases. The UAW had still not called for walkouts as of 7:30 a.m.as workers started reporting for morning shifts in the U.S. Midwest.
Marchionne was planning to be on hand at the auto show on Tuesday for the first public reveal of the Alfa Romeo Giulia sedan and the Ferrari 488 Spider. The UAW is requesting a bigger piece of the profit pie, asking that automakers raise hourly pay for veteran workers who haven’t seen a raise in about a decade or so.
Bargainers at GM, Ford and Fiat Chrysler have said health-care costs have been rising at an unsustainable rate and could climb even higher with a new federal tax going into effect in 2018. With about 45% of its hourly workforce earning the lower wage, the company has about a cost advantage of $9 to $10 an hour over rivals GM and Ford. Once older workers retired, a new permanently lower maximum wage, a sort of “1.5” tier wage, in the neighborhood of $20-22 per hour, would be established. Because FCA has the largest proportion of lower-paid employees, labor costs would surge if many Tier 2 workers are promoted, something that is stipulated in the current contract. The auto makers are unwilling to concede too much to the union after getting deep concessions from them.
The union wants to close the gap between workers hired before and after 2007.
“We remain committed to working with the UAW to develop an agreement that benefits employees and strengthens GM’s long-term competitiveness”, GM said in a statement. The current contracts expire Monday, but will likely be extended.
Some UAW members, as they have during this year’s unusually quiet talks, took to social media to voice their displeasure regarding the lack of communication as the contract deadline came and went.
Ford Executive Chairman Bill Ford said last week he is “optimistic” a settlement can be reached with the union.