Fiat Chrysler Automobiles NV, the third largest US automaker and the United Auto Workers union announced Thursday a new tentative four-year labor deal has been reached, ending the doom-threat of a strike at the carmaker’s US business.
The new agreement now must once more go through the ratification process and get a positive vote from Fiat Chrysler’s 40,000 union workers in the United States before becoming active. The first attempt was unsuccessful as the previous deal was soundly rejected by rank and file UAW workers last month. They were mostly dissatisfied by the union’s inability to narrow or completely eliminate the pay difference between veteran workers and new hires. So far both sides refrained from delivering any details concerning the new agreement and it’s not clear yet if FCA has agreed to spend more money than under the previous proposal.
Many rank and file workers voting against the previous contract said they rejected it because they sought the elimination of the two-tier wage and benefit system and if falling short in that respect they wanted a cap of 25 percent of total union workforce for the lower-paid second tier. If the new tentative agreement is ratified, the UAW union will take this deal as a template in its negotiations with the other two Detroit automakers – General Motors and Ford. The UAW Chrysler Council is now set to convene in Detroit on Friday morning to discuss the pact and vote on it. The decision to avert a strike, for the second time, showcases the UAW coping with pressure to preserve jobs, even as the US automakers have seen a spectacular recovery from the dark days of the financial crisis of 2008-2009.