UAW’s King: Wage increases on the table for Tier II workers

August 30, 2011

UAW’s King: Wage increases on the table for Tier II workers

/ The Detroit News

Detroit— United Auto Workers President Bob King said Monday that the union is asking Detroit’s Big Three for wage increases for second-tier workers as part of its ongoing negotiations toward a new national labor agreement.

“We’re very concerned about that entry-level member having a middle-class standard of living, which I would argue they don’t at the current rates,” he told reporters after a speech at the Detroit Economic Club.

“I would say that’s our highest priority.”

The two-tier wage system was a key element of the last national contract between the UAW and Ford Motor Co., General Motors Co. and Chrysler Group LLC. That agreement was ratified in 2007 and expires Sept. 14. It allowed the automakers to pay second-tier employees, who are all recent hires, about half what veteran hourly workers make. It also limits their benefits.

King did not specify whether the union’s proposal to raise second-tier pay would apply only to those already on the job or to future hires as well.

He would not say how the companies reacted to the union’s proposal, but said he is “upbeat” about the progress at the bargaining table.

John Fleming, Ford’s vice president of global manufacturing and labor affairs, also expressed optimism.

“It’s early days. (But) the atmosphere is very good,” Fleming said. “It doesn’t mean there aren’t plenty of issues to be resolved.”

Some labor analysts believe King is aiming for an early agreement with the Detroit automakers and their 113,000 UAW workers as a way of showing the American people — and foreign manufacturers — that the UAW has evolved and is embracing a more cooperative approach to labor relations.

“That’s pretty hard to do, to get it done early,” King said, adding he is working “every day” to organize one of the transplants.

“I’m very optimistic,” he said. “Our No. 1 priority and responsibility in these negotiations is to get the best contract possible for our membership. I believe doing that will also support our organizing efforts.”

During his speech, the UAW leader said the U.S. auto industry is an example of how “creative problem solving” can generate more profits and jobs.

“Look at the amazing success that we’ve had,” he said, referring to the industry’s recovery. “We quit vilifying each other.”

The union leader has said he wants a contract that allows workers to share in the companies’ success without adding significantly to their fixed costs and making them uncompetitive with foreign automakers operating in the United States. He says the key is some form of profit-sharing mechanism.

“Our companies face a lot of competition,” King said. “We just want to make sure that we come out of this negotiation over the next four years structuring our companies to succeed. If you add fixed costs, they won’t be able to do that.”

Protecting jobs and creating new ones are his top priorities, King said.

“We want these companies to come back. We want them to open up new facilities and put new shifts,” he said. “We’re about creating more jobs, more investment, more product here in the United States of America.”

The best way to make sure they do that, he said, is to keep them competitive.

Workers at Ford factories around the country have begun taking strike votes, authorizing the UAW leadership to call a walkout if talks fail to achieve an agreement. King stressed that is a formality and said he would view a strike as a failure.

“I just feel like we can do better,” he said.

The union cannot strike GM or Chrysler under the terms of those companies’ 2009 bailout by the federal government.

If the UAW reaches an impasse with either, it must go into arbitration. King said he hopes to avoid that, too, and said Ford would not be disadvantaged by its unique position.

King devoted most of his formal speech to arguing for higher taxes on corporations and wealthy individuals.

“We’re not broke,” he said of the U.S. government. “Our basic problem is that we have an extremely unfair tax system.”

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Additional Facts
Ford strike vote
Some 41,000 UAW Ford hourly workers are voting this week to authorize leaders to call a strike.
Union members at a Ford Motor Co.’s Claycomo plant near Kansas City, Mo. voted in favor by 3,049 to 18, leaders said.
The vote is standard procedure in contract negotiations and doesn’t necessarily mean that there will be a strike.
All Ford workers represented by the UAW will vote on the same issue by Friday.

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