US: new tentative agreement seen taking steps to end two-tier wage system image

According to United Auto Workers President Dennis Williams, help the newly renegotiated four-year contract deal with Fiat Chrysler Automobiles NV will set the base-salaried workers en route to the top wage.

Williams talked to media representative son Friday once the top leadership at the UAW approved the newly renegotiated pact and commented on one of the crucial reasons why the earlier proposal had been soundly rejected by the Fiat Chrysler union workers – they did not see a clear path to the top payment system. The newly inked proposal has workers reaching the top salary status in up to eight years with the company. The contentious issue has been around the 2007-agreed system that allowed the embattled Detroit automakers – GM, see Ford and Chrysler Group LLC – to hire new workers at a lower salary base than company veterans. The president has also announced the tentative health pool that was supposed to negotiate lower insurance costs and was another reason for discontent among rank and file members was now out of the contract.

Fiat Chrysler, the third largest US automaker and the seventh biggest in the world is also the weakest – financially – among the Detroit makers and has seen its labor costs at a lower level partly because it has the highest percentage of second-tier, lower paid workers. Now the new deal, if ratified, would pave way to the elimination of the much-debated two-tier salary structure. The initial proposal didn’t stride to eliminate the scheme, but rather close in part the gap between the second tier employees and the veterans.

Via Reuters