US: UAW president pledges to lower gap between labor costs at Detroit Three image

United Auto Workers President Dennis Williams announced on Thursday his intention is to close the disparity between labor costs at the US automakers, with union employees being paid a lot less at Fiat Chrysler than at competitors Ford and General Motors.

The latest study on the matter, conducted recently by the Center for Automotive Research showed that FCA US’s average salary and benefit costs for each auto worker amount to around $48 per hour – while General Motors pays $58 per hour and Ford $55. “We’re going to try our best to get that in line, and we’re working on that,” commented Williams, adding the pay and benefits get “distorted because of circumstance,” meaning the concessions the UAW in the past offered to GM and FCA as the companies went through bankruptcy reorganization back in 2009. The strategy to bridge the gap has not been disclosed, though the UAW has traditionally followed a basic “pattern” – each crucial issue is treated on a similar manner by the union when discussing separately with the three US automakers. “The companies ought to compete on product, quality, engineering and process and not on the backs of workers,” added the president during a media briefing at the UAW’s headquarters.

Back in 2007, when all three Detroit automakers were seen heading towards disaster, the UAW agreed to a two-tier wage and benefit system at all three carmakers, essentially protecting the veteran workers at the expense of new hires. Fiat Chrysler took the most advantage of that scheme, with significant hiring of the second-roster new workers taking place after the UAW and the automaker renegotiated the contracts in 2011.

Via Reuters