Shawn Fain, president of United Auto Workers, said the union’s tentative agreement with General Motors is the union’s first step toward securing a better economic future for the working class, and he urged members to ratify it.
Fain spent about 20 minutes on Facebook Live Saturday afternoon with Mike Booth, the vice president leading negotiations with GM, explaining the key details of the tentative agreement the union reached with GM on Monday.
The two noted that this contract includes new groups of workers — including union-represented employees and workers at new battery factories — who have not historically been included in hourly worker gains in the framework agreement.
“After months of (GM) saying this was impossible, Ultium Cells workers are now subject to our national agreement,” Fain said. “The importance of this cannot be overstated. As the future of our industry is being defined, employers like GM have used joint ventures to fuel a race to the bottom. These jobs at Ultium Cells are difficult, dangerous and pay low wages.” But all of that ends in this agreement.”
Ultium Cells, based in Lordstown, Ohio, is a joint venture between GM and LG Energy Solution to produce battery cells for GM’s electric vehicles based on GM’s Ultium powertrain system. Fain said that once ratified, Ultium Cells employees will become GM employees covered by the national agreement and receive some locally negotiated benefits.
Following ratification, there will be a six-month window for former employees of GM’s former Lordstown assembly plant who were active at the plant on November 26, 2018 – the day GM announced the plant’s closure – to apply to return to work region and work at the Ultium Cells plant, said Fain.
“Former Lordstown members who have transferred will retain their current wages, benefits and seniority,” Fain said. “All new hires will receive at least 75% of the maximum wage rate set forth in the UAW national agreement, and any amount above 75% will be negotiated locally.”
This means that upon ratification, production workers at Ultium Cells will receive an immediate raise of $6 to $8 per hour, and all hourly and salaried employees, including those at GM’s parts distribution centers, will receive a $5,000 ratification bonus.
Some of the main highlights
The tentative GM agreement largely mirrors what is contained in the agreements with Stellantis and Ford Motor Co. that are currently being ratified. The UAW first reached a tentative agreement with Ford on Oct. 25. The union won one with Stellantis a few days later and finally won one with GM on Monday.
The full report on the GM agreement is available at www.uaw.org/GM2023; Below are some of the highlights:
- The agreement calls for a 25% base wage increase through April 2028 and will cumulatively increase the top wage by 33%, along with the estimated cost of living adjustment (COLA) to over $42 per hour for all union-represented workers.
- Starting wage increases by 70% plus estimated COLA to over $30 per hour.
- The GM agreement will eliminate several wage levels. The workers now being moved to main production include workers in parts distribution and at GM’s Brownstown battery plant.
- For the first time since its founding in the 1990s, unionized GM employees will receive an across-the-board wage increase that matches hourly workers.
- The deal also brings two key groups into the UAW GM Master Agreement, Ultium Cells and GM Subsystems LLC.
- For retirees, GM has agreed to make five $500 payments to current retirees and surviving spouses, the first such payments in more than 15 years.
- Like the other two, the GM deal also includes the right to strike during plant closures.
The right to strike a plant over closures is a big win, Fain said.
“Over the last 20 years, GM has closed nearly twice as many plants as Ford and Stellantis combined,” Fain said. “GM’s product commitments are no longer just on paper, but are now backed by the power of a strike threat.” GM knows we won’t hesitate to strike if we have to.”
The tentative agreement also includes a $1.25 billion investment in GM’s Lansing Grand River Assembly Plant and $391 million for Fairfax Assembly in Kansas for future electric vehicle production, the UAW said in the contract summary.
According to the summary, GM will invest $300 million to produce electric drive units at its engine plant in Tonawanda, New York. And it said: “Within 12 months of ratification and during the term of this agreement, sufficient labor will be provided to employ at least 150 people” at GM’s plant in Kokomo, Indiana. The UAW said the agreement commits GM to more than $11 billion in additional manufacturing investments already planned. Most of this is related to the production of electric vehicles.
A $50,000 retirement incentive
The agreement will also give GM employees at certain plants the opportunity to move to either battery factories or electric vehicle factories as jobs emerge as GM transitions to an all-electric future. GM is building three more battery factories – including an Ultium cell factory in Lansing that is expected to begin operations late next year.
Booth said that under the agreement, GM will offer three company special attrition programs (SAPs) starting in January 2024 through the term of the agreement, which include a flat retirement incentive of $50,000 before taxes for traditional employees who receive the normal or Meet early retirement requirements.
“For current employees, we won a groundbreaking 10% employer contribution without requiring an employee contribution to their 401(k),” Booth said. “Our union is fighting hard to ensure that everyone finds a path to a decent retirement without having to work more than 40 hours a week.”
Strikers at four GM assembly plants and 18 parts distribution centers across the country return to work during the ratification process.
Higher new car prices
Fain ended the presentation with a pointed comment on what he called “noise” analysts were making about how the impact of the strike and union contract could lead to higher new car prices.
“Car prices have risen sharply, but that’s not because of worker wages, low inventory or anything other than corporate greed,” Fain said. “Over the last four years, the average price of a new car has increased by 30% or more. The profits from these higher prices were not passed on to the workers who made these vehicles. Instead, it ended up directly in the pockets of shareholders and corporate executives.”
Fain said the strike and tentative agreement were a correction to automakers’ decades of labor-driven profitability, but auto executives did not want the public to support the union’s fight against corporate greed.
“So they’re using our contract as an excuse to raise prices, scapegoating our union in the process,” Fain said. “It is a win-win situation for the automobile companies. They can continue to price consumers while demonizing the union for having the courage to demand a fair share.”
Fain concluded the presentation by saying that the people who make and buy the cars are U.S. taxpayers, which is why the UAW will fight to transform the economy into one that benefits the working class.
“This contract is our union’s first step in that direction, and I am proud to present it to members for a vote in solidarity with this committee,” Fain said.
More: GM and UAW reach tentative agreement after weeks of contract negotiations
More: Shawn Fain meets the moment to make history in the automotive industry, experts say
Contact Jamie L. LaReau: [email protected]. Follow her on Twitter @jlareauan. Read more about General Motors and subscribe to our automotive newsletter. Become a subscriber.