UAW members at Dana plants in Indiana, Kentucky, Michigan, Missouri, Ohio, Pennsylvania and Texas approved a new four-year agreement that protects wages and health care for active workers, and pensions and health care for retired workers.
The agreement, which also covers members of the United Steelworkers (USW) at three facilities in Indiana and Kentucky, also brings a commitment from investment firm Centerbridge Partners to invest $500 million and to sponsor a reorganization plan that allows Dana to emerge from bankruptcy.
“Our UAW and USW bargaining teams worked very hard to craft this deal,” said UAW President Ron Gettelfinger. “We are extremely pleased that an overwhelming majority of members voted to ratify the agreement.”
“This agreement creates a path to success for Dana, Dana workers and the communities where we live and work” said UAW Vice President Bob King, who directs the union’s Independents, Parts and Suppliers Department. “It protects our members and retirees, and for the first time we negotiated a commitment from the company to source work to UAW- and USW-represented plants.”
Ratified Tuesday by workers in all eight locations, the contract covers more than 2,300 UAW members and 6,200 UAW retirees. UAW members approved the pact by 86 percent.
“We were facing a world of hurt,” said Local 644 Plant Chairman Tom Alderfer, who also served on the bargaining committee. “When we went into this, the company wanted to cut our pay by $5 an hour and we were told we would lose our health care and most of our pension.
“Considering where we were and where we ended up, it’s nothing short of a miracle,” said Alderfer. “This agreement maintains our pay and benefits. Now our members have piece of mind knowing that they can continue to provide for their families.”
Additionally, the company will contribute over $750 million to Voluntary Employee Beneficiary Association (VEBA) trust funds, which will provide payment for health care to UAW and USW current and future retirees. This represents more than 70 percent of the projected cost of health care benefits for retirees.
Other highlights of the agreement include:
- Voluntary buyouts of up to $45,000 for eligible employees.
- A new defined benefit pension plan for all UAW and USW Dana workers, administered by the Steelworkers Pension Trust.
- Post-bankruptcy emergence bonus of common stock valued at approximately $6,000 for each active member with at least one year seniority.
- A moratorium on moving work out of UAW and USW plants to non-unionized facilities.
- A commitment to source new product lines to UAW- and USW-represented worksites.
New contracts at all UAW-Dana and USW-Dana locations will have a common expiration date of June 1, 2011.