General Motors ratified a new four-year labor contract with the United Auto Workers union last Friday, after intense negotiations.
Two weeks ago, 52, 700 GM workers who are members of the United Auto Workers union voted in favor of the new agreement with the American carmaker, following heated discussions. Sources in GM declared that the ratification was “good for employees and the business.” According to the new contract, the average labor cost (out of which almost half is pay) for GM workers will be 60 dollars per hour until 2019. The previous average was 55 dollars per hour.
However, the ratification was postponed for a fortnight because skilled trade workers who deal with machine maintenance at GM’s auto plants (namely electricians, pipefitters, tool makers and millwrights) vetoed the contract. Despite the fact that the number of skilled workers is smaller than the number of GM’s general workers, the union leaders took notice, enquired for their reasons and decided to further negotiate the agreement with GM’s management.
Sources from inside UAW mentioned that “core trades classifications and seniority rights” were among the issues. The union also declared they had a clear mandate support any claims from any minority of its members and made it very clear that if the agreement does not meet full members consent, ratification is not possible. “Since its inception, the UAW has put in place a process to ensure that minority groups have a voice,” the union representatives stated.
The new contract, which will be enforced from Monday, will grant salary increases to all workers and will put a stop to the two-tier payment system which has been the norm at GM. However, a newly employed worker will have to toil for eight years to get to maximum pay, rather than three years, as it used to be before 2007. Year 2007 marked a change in GM’s policy, most likely because of the economic downturn, as workers employed after this year made less than those hired before.