UAW, Ford deal is in jeopardy

October 27, 2009

UAW, Ford deal is in jeopardy

Two locals reject contract backed by union leaders

The Detroit News

Sterling Heights –A tentative agreement on concessions between Ford Motor Co. and the United Auto Workers is facing unprecedented opposition, with many workers saying Ford’s comparative success makes further givebacks unnecessary.

On Monday, 80 percent of workers voting at Ford’s Sterling Axle Plant rejected the proposed contract changes — a surprising upset, since the factory would gain about 100 jobs if the deal is ratified. That came a day after a stunning 92 percent of workers at Ford’s Kansas City Assembly Plant rejected the agreement.

UAW President Ron Gettelfinger has said the concessions are necessary to maintain pattern bargaining, which has for decades essentially assured equality in wages and benefits for workers at Detroit’s automakers. But union dissidents appear to be winning the debate on the factory floor.

As of Monday night, locals representing about 8,000 of Ford’s 41,000 UAW members had voted against the contract changes.

It is the most serious challenge to Gettelfinger’s leadership yet, and he and other union leaders have fanned out across the country in an eleventh-hour bid to save the agreement.

Even if they succeed, the outpouring of opposition has raised serious questions about Gettelfinger’s ability to deliver on promises of parity for Ford after granting significant concessions to rivals General Motors Co. and Chrysler Group LLC during their government-mandated bankruptcies earlier this year.

"It’s a vote of no confidence in Gettelfinger, and it’s a vote of no confidence in Ford’s ability to deal with labor issues," said Gary Chaison, professor of labor relations at Clark University in Worcester, Mass.

Gettelfinger sold previous concessions to workers by promising to fight for restoration once Ford returned to profitability, Chaison said. As the Dearborn automaker prepares to announce next week what is likely to be another quarter of better-than-expected earnings, it is struggling to convince workers to give any more.

"Ford’s problem is that they have an embarrassment of riches," Chaison said. "They’re not bankrupt. Ford has made the case that it’s different than GM and Chrysler. That may have helped sales, but it’s not helping now. There’s been so much encouraging news from Ford that the workers who are still there feel they should be rewarded."

Instead, they are being asked to match at least some of the concessions the UAW granted to GM and Chrysler.

Ford spokesman Mark Truby said the automaker has "been consistent about communicating our plan and fairly presenting our progress against our plan."

Ford’s tentative agreement with the UAW includes a freeze on wages and benefits for new hires and changes in work rules that would give Ford greater flexibility in how it deploys workers in factories. But the deal also include limits on the union’s right to strike over wage and benefit increases — the biggest point of contention for workers, and one that could jeopardize pattern bargaining.

"Pattern bargaining has been vital for the union for decades," said labor expert Harley Shaiken, a professor at the University of California-Berkeley. "It has ensured that the gains won by workers at one company are shared by all."

He said union leaders believe that giving Ford at least some of what the UAW gave GM and Chrysler is key to guaranteeing that tradition continues.

Pact maintains pattern

If the proposed agreement is ratified, Ford workers — like their counterparts at GM and Chrysler — would not be able to take to the picket lines if they are unable to reach an agreement on any increase to wages and benefits during the next round of national contract talks in 2011.

As The Detroit News first reported Saturday, this was demanded by the Obama administration as a condition of its bailout of GM and Chrysler. The White House did not want to invest billions in taxpayer dollars to make those companies competitive only to see the gains reversed in the next round of negotiations.

If Ford does not receive a similar commitment from the UAW, it will be at a clear disadvantage once bargaining begins.

Dissident leader Gary Walkowicz, a member of the bargaining committee at UAW Local 600 that represents workers at Ford’s River Rouge complex, said the union’s acceptance of this so-called "no strike" language is the chief reason he and others oppose the agreement. He said Gettelfinger and other UAW leaders sold workers on previous concessions on the grounds that they would fight to restore those givebacks once Detroit automakers were back in the black.

"This shows that never was their intention," Walkowicz said. "People are angry at the union leadership. They feel like they were betrayed and lied to."

Gettelfinger declined to comment for this story. But he and other UAW leaders have accused dissidents of deliberating spreading "misinformation."

At Sterling Axle on Monday, workers opposed to the deal passed out leaflets listing the salaries of top Ford executives for 2007 — before they took substantial pay cuts.

At Kansas City and elsewhere, the dissidents have shouted down union leaders urging ratification.

Some workers support deal

Not all workers have been swayed.

Brian Pannebecker voted in favor of the agreement Monday at Sterling Axle. As painful as recent concessions have been, he said, they have made Ford competitive for the first time in years. He is worried about the automaker’s long-term prospects if it loses the ground it has gained.

"We got into trouble because our labor costs were not competitive with Toyota and Honda," Pannebecker said. "It would be foolish to turn around now and put ourselves at a point where we’re not competitive with GM and Chrysler."

Ford has made progress, but its success can only be viewed as such in comparison with its cross-town rivals.

The automaker lost more than $14.6 billion last year, and while Ford posted a surprise second quarter profit of more than $2.2 billion this year, it is not expected to be profitable on a full-year basis until 2011. Ford also remains saddled with tens of billions in debt, while GM and Chrysler were able to shed most of their liabilities in bankruptcy court.

This suggests that Ford and other automakers will face even more resistance from union members as the turnarounds at GM and Chrysler gain traction.

Kansas City and Sterling Axle are not the only factories that have voted against the agreement.

Though their facility received promises of additional work as part of the deal, workers at the Livonia Transmission Plant rejected the contract changes by a 52 percent to 48 percent margin on Friday, according UAW Local 182 President Steve Zimmerla.

Paul Vella, a 16-year-veteran Livonia veteran, voted no.

"We can’t afford more concessions," he said.

Workers at a parts facility in Plymouth also voted against the contract modifications.

Union members at other plants — including Wayne Assembly Plant, Michigan Assembly Plant and three engine plants in Cleveland — voted narrowly in favor of ratification last week.

At many factories, local UAW leaders have remained neutral in the debate because they fear supporting the deal could cost them their seats in upcoming spring elections, according to sources.

In addition to Sterling Axle, workers at Ford’s Auto Alliance Inc. plant in Flat Rock voted Monday, but results were not available.

All voting is expected to be done by Saturday.

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