November 1, 2009
UAW accepts defeat of plan to change Ford deal
Workers say fatigue, skepticism led vote
BY BRENT SNAVELY
FREE PRESS BUSINESS WRITER
Even with a few UAW locals left to vote today, UAW officials have concluded that there is no way that a proposal to modify its labor contract with Ford Motor Co. can pass.
On Friday, two of the UAW’s largest units, which represent an assembly plant in Dearborn and two in Louisville, Ky., followed the lead set by other locals by soundly defeating the proposal that Ford said it needed to be competitive long term with its domestic rivals, General Motors Co. and Chrysler Group LLC.
"It looks like the numbers are heavily against" the deal, said Rocky Comito, president of UAW Local 862 in Louisville. "I see no way of overcoming it."
UAW President Ron Gettelfinger told the Free Press on Friday that the union would not go back to the bargaining table if the measure was defeated. The current Ford-UAW labor contract expires in 2011.
"We will continue to work with the company to secure the jobs of our membership, regardless of the outcome," Gettelfinger said.
Workers cited several reasons for rejecting the deal over the past week. Among them: Growing belief in Ford’s increasing success. Fatigue over Ford’s repeated requests for contract changes. Skepticism that Ford would deliver on promises already made in recent years. A binding arbitration clause that many saw as the elimination of their right to strike.
Final ratification is based on a simple majority of the total votes cast by two separate classes: production workers and skilled-trades workers.
On Friday, two of the largest UAW locals joined with opponents of the deal. Eighty-four percent of the 5,238 workers that voted at Ford’s Louisville Assembly Plant and its Kentucky Truck Plant were opposed to the contract. Meanwhile, 93% of those that voted at Ford’s Dearborn Truck Plant, which is represented by UAW Local 600, also voted to reject the contract.
As of Saturday, a majority of members at UAW units representing more than 26,000 members had voted to reject the contract while a majority of members at UAW units representing 5,312 members had voted in favor of the contract.
About 41,000 hourly Ford workers are represented by the UAW.
The tentative agreement on which workers were voting called for a wage freeze for entry-level workers, a commitment to binding arbitration in 2011 for disagreements over pay and benefit increases and a consolidation of skilled-trades classifications. In return, Ford agreed to provide $1,000 bonuses to workers and additional work to a number of plants.
The deal would have allowed Ford, generally, to match labor cost savings that General Motors and Chrysler got through bankruptcy reorganizations.
The UAW’s leadership recommended its members ratify the deal earlier this month.
David Cole, chairman of the Center for Automotive Research in Ann Arbor, said Friday that a rejected contract could create problems for the UAW’s leadership, as well as for Ford.
"That’s a repudiation of the UAW leadership," Cole said. "Once you negotiate something, and you can’t pull it off, you have a real problem."
Comito said the UAW’s leadership will survive unscathed because the opposition to the proposed modifications had more to do with the fatigue of being asked repeatedly to agree to changes and opposition to specific measures — not to the leadership.
But Cole said the rejection could cause issues for Ford.
Ford, which lost $14.6 billion in 2008, has gained market share this year and is expected to show financial gains when it reports third-quarter results on Monday that are due, in part, to an agreement reached with the UAW in March.
But Ford remains burdened with more debt than its domestic rivals, and it has yet to generate cash in its critical North American operations.
"If they don’t have a competitive contract, that really adds to their competitive issues," Cole said.
The overwhelming rejection of the contract stands in contrast to the relationship the UAW has had with Ford in recent years.
In fact, UAW Local 600 President Jerry Sullivan said 1976 was the last time he remembers a national contract or contract modification being rejected by the UAW.
"That was the last time we went on strike, and I have not recalled anything since then," Sullivan said.
Sullivan tried to convince members to vote in favor of the deal, especially because it would have created or preserved more than 7,000 jobs nationwide, but to no avail.
"The bottom line is still that job security, you have to have that," he said.
Nick Kottalis, president and chairman of the Dearborn Truck unit of UAW Local 600, said his members remain proud to work for Ford, but just weren’t willing to agree to any additional cuts.
Kottalis riled higher ranking leaders by distributing a letter to workers urging them to reject the deal.
"We wanted Ford to honor this contract that they told us they were gong to honor till 2011," Kottalis said.
Henry Teachey, 52, of Detroit said bringing this latest deal to members for a vote was difficult for elected union officials, who are put in office by their members. Teachey said he tried to convince workers to vote in favor of the contract, but few wanted to listen.
"It’s taken a toll on a lot of us," Teachey said. "I’ve had many sleepless nights."