Latest Solidarity Issue

New videos describe history, funding and structure of UAW Retiree Medical Benefits Trust

10/08/12

Now Available: New videos describe the historic events that transpired from 2007 – 2011 that changed the way medical benefits are provided for UAW auto retirees. Click to view these videos, which are on the Trust's website at uawtrust.org

Structure, History and Funding of the Trust Video

You know the Trust provides health care benefits for retired UAW members of General Motors, Ford and Chrysler, along with their eligible dependents. But, how did we move from company-paid benefits to a Trust fund and how does the fund work? And, more importantly, what does the future look like?

This video will give you a better understanding of how the Trust fund came into existence, what purpose it serves, how it helped protect your benefits during the financial crisis of 2009 and why that crisis – as well as long-term economic realities in health care – have created funding challenges for the Trust that we all need to work together to address in the coming years.

Click to view videos – there is an overview and summary as well as a detailed history and chronology.

 

 

 

UAW statement on retirees and 2011 Big Three negotiations


Sept. 30, 2011

The UAW has a long history of fighting for and protecting its retirees, and through the years, we have been able to bargain good pensions, Christmas bonuses, pension increases, health care benefit improvements and other improvements for our retirees. We accomplished all these gains for retirees even though many years ago a Republican majority on the U.S. Supreme Court ruled that we do not have the right to strike over retiree issues.

In 2008, when the economy collapsed and General Motors and Chrysler were teetering on the edge of bankruptcy, many Republicans wanted to strip retirees of all health care benefits and throw our pensions to the Pension Benefit Guaranty Corp. (PBGC). If they had succeeded, GM and Chrysler pensions would have been reduced to about 65 percent of the basic pension, and retirees would have been left without any health care. The UAW fought for retirees in the congressional hearings, through lobbying, protesting and many other activities. GM and Chrysler retirees’ pensions and health care were saved as a result.

In the current round of auto bargaining, we were faced with two insurmountable obstacles to winning the gains we wanted for our retirees. First, in the past we were able to fund pension increases and Christmas bonuses out of the UAW Big Three pension funds because the pension funds were either fully funded or, in some years, even overfunded. This year, we face the worst shortfall in our history of pension underfunding. Because of Wall Street’s continuing problems, the GM, Ford and Chrysler hourly pension funds are all underfunded. Obviously, because of this shortfall, we could not use the pension funds to pay for the Christmas bonuses or any other improvements.

The second insurmountable obstacle to winning Christmas bonuses for retirees is the current retiree to active member ratio. The current active UAW membership at GM, for example, is 48,000 members to 405,000 UAW GM retirees, making it nearly a 10-to-1 ratio of retirees to current working members. During these negotiations, the UAW also explored the idea of paying for retiree Christmas bonuses by having each active member contribute to a fund to pay these bonuses. With the almost 10-to-1 ratio of retired to active workers in GM and similar ratios at Chrysler and Ford, funding a $600 retiree bonus for GM retirees would require a nearly $6,000 contribution from each active UAW GM member. The problem is similar at Ford and Chrysler. At Ford, the retiree to active ratio is about 3.5 retirees to each active, and at Chrysler, there are almost four retirees to every active member. Obviously, it is not possible in these economic times with these ratios to fund retiree lump sums out of active members’ earnings.

Finally, we were able to negotiate and ratify a 10 percent contribution from active members’ profit sharing that will be diverted to the Voluntary Employee Beneficiary Association (VEBA). This diversion helps to make possible the modified dental and vision coverage that will be restored by the VEBA for our UAW Big Three retirees in January 2012.

Our hope is that all of the Big Three – with the continued dedication of our UAW members – will return to being a strong and viable company which will help the profitability and stock of these companies rebound, and that the economy and our pension funds will also rebound, making it possible to win yearly bonuses for our retirees in future negotiations.

 

UAW statement on retirees and 2011 Big Three negotiations

The UAW has a long history of fighting for and protecting its retirees, and through the years, we have been able to bargain good pensions, Christmas bonuses, pension increases, health care benefit improvements and other improvements for our retirees.  We accomplished all these gains for retirees even though many years ago a Republican majority on the U.S. Supreme Court ruled that we do not have the right to strike over retiree issues.  

In 2008, when the economy collapsed and General Motors and Chrysler were teetering on the edge of bankruptcy, many Republicans wanted to strip retirees of all health care benefits and throw our pensions to the Pension Benefit Guaranty Corp. (PBGC).  If they had succeeded, GM and Chrysler pensions would have been reduced to about 65 percent of the basic pension, and retirees would have been left without any health care.  The UAW fought for retirees in the congressional hearings, through lobbying, protesting and many other activities.  GM and Chrysler retirees’ pensions and health care were saved as a result.

In the current round of auto bargaining, we were faced with two insurmountable obstacles to winning the gains we wanted for our retirees.  First, in the past we were able to fund pension increases and Christmas bonuses out of the UAW Big Three pension funds because the pension funds were either fully funded or, in some years, even overfunded.  This year, we face the worst shortfall in our history of pension underfunding.  Because of Wall Street’s continuing problems, the GM, Ford and Chrysler hourly pension funds are all underfunded.  Obviously, because of this shortfall, we could not use the pension funds to pay for the Christmas bonuses or any other improvements.

The second insurmountable obstacle to winning Christmas bonuses for retirees is the current retiree to active member ratio.  The current active UAW membership at GM, for example, is 48,000 members to 405,000 UAW GM retirees, making it nearly a 10-to-1 ratio of retirees to current working members. During these negotiations, the UAW also explored the idea of paying for retiree Christmas bonuses by having each active member contribute to a fund to pay these bonuses. With the almost 10-to-1 ratio of retired to active workers in GM and similar ratios at Chrysler and Ford, funding a $600 retiree bonus for GM retirees would require nearly $6,000 contribution from each active UAW GM member.  The problem is similar at Ford and Chrysler. At Ford, the retiree to active ratio is about 3.5 retirees to each active, and at Chrysler, there are almost four retirees to every active member. Obviously, it is not possible in these economic times with these ratios to fund retiree lump sums out of active members’ earnings.
Finally, we were able to negotiate and ratify a 10 percent contribution from active members’ profit sharing that will be diverted to the Voluntary Employee Beneficiary Association (VEBA).  This diversion helps to make possible the modified dental and vision coverage that will be restored by the VEBA for our UAW Big Three retirees in January 2012.

Our hope is that all of the Big Three – with the continued dedication of our UAW members – will return to being a strong and viable company which will help the profitability and stock of these companies rebound, and that the economy and our pension funds will also rebound, making it possible to win yearly bonuses for our retirees in future negotiations.
 

Statement By Retiree Medical Benefits Trust regarding 2012 benefits

09/23/11

The independent Trust that is responsible for providing retiree medical benefits to UAW retirees from GM, Ford and Chrysler has issued a statement in response to questions from retirees regarding the benefits that will be provided by the Trust in 2012. Full details on the 2012 benefit levels will be provided by the Trust to all retirees in a mailing in November. Until the November mailing occurs, the Trust will not be able to provide additional information to the press or others. Retirees can always find additional information about the Trust and their medical benefits by visiting www.uawtrust.org.

Click to read the statement.

Auto Talks II


The domestic auto companies have made a remarkable turnaround following the historic crisis of 2009-2010. For the first time in more than seven years, all three companies are showing a profit. UAW members merit enormous praise for their role in achieving this success.

In addition to the large financial sacrifices workers made, UAW members also deserve credit for their contribution to improved quality, improved productivity and attention to the interests of consumers. We have shown that the union is a critical partner in the success of our companies by championing flexibility, innovation and teamwork. We have demonstrated that the union and management can operate in a culture of mutual respect, trust and joint problem-solving. The dramatic turnaround and success of the automakers is proof of the value added by UAW members.

Of course, none of this would have been possible if President Obama had not made the courageous and politically unpopular decision to rescue the American auto industry. Despite universal and often vicious opposition by Republicans, the president took the necessary steps to protect this critical segment of the American economy. As a result of his strong leadership, millions of jobs were saved, not only in auto assembly, but in a vast range of businesses both large and small.

Now it’s time for the UAW to make smart decisions about how to gain a fair share in the success of the domestic automakers while also ensuring the continued success of our employers, and most importantly the long term job and income security of our members.

Fair compensation

It is the proud legacy of the UAW to have fought for and gained a middle-class standard of living for workers in the auto industry. Indeed, the achievement of middle-class status for autoworkers contributed greatly to the building of a broad-based, middle-class society. The UAW set the standard for the economy as a whole, and for decades the United States was a model to the world of a society built upon the foundation of a strong, vibrant middle class. UAW members never sought to become rich; what we wanted was simply through our hard work to gain the American dream of a modest home, health care, retirement security and the ability to provide an education for our children.

It is critical to understand the reason the UAW was able to win a middle-class standard of living in the second half of the 20th century. The reason is this: In the 1940s, the union organized 100 percent of the industry. All autoworkers in the United States were part of the UAW.

When the UAW went to an individual company and asked for an increase in pay and benefits, the company would say, “If we give you more pay and benefits than our competitors, we will lose market share because we have higher costs.” In response, the UAW would say,

“We guarantee that whatever raises or gains we bargain with you, we will bargain with your competitors, and your fixed costs will not be higher than those of your competitors. We will demand all of the companies pay the same wages and benefits, so that no company will become uncompetitive.”

Since all the companies were unionized, we could make good on the guarantee to bargain competitive labor costs at all companies. This is the concept of “pattern bargaining.” The foundation of pattern bargaining is that the entire industry is unionized.

Everything changed when auto companies from Japan, Korea and Germany set up nonunion operations in the United States. Ironically, these companies recognize unions in their home countries, but they have so far thwarted efforts by American workers to join the UAW. The transnational auto companies have gained a large percentage of the United States market, in part by keeping their total labor costs under what is paid by the unionized automakers. Following the crisis of 2009, the unionized automakers could no longer set the pattern for compensation. Instead, the labor costs at Toyota – the largest transnational company – set the pattern that union workers had to follow.

The dilemma is clear: If the UAW bargains fixed cost compensation from the unionized companies that is higher than the nonunion companies, the added fixed costs of the domestic automakers will harm the competitiveness of the unionized companies, making our products more expensive or reducing the revenue margin needed for new product investment. As a result, the nonunion automakers would continue to undercut the domestic automakers and gain a larger and larger share of the market.

There are two things the UAW must do to protect our members, while gaining justice for our working people:

• Win important gains for our members, while keeping our fixed labor costs competitive with the overall industry in order to protect the long-term job and income security of our members.

• Organize all U.S. auto plants so that we can guarantee employers with whom we bargain that when we negotiate improved wages and benefits for our members, these gains will not put them at a cost disadvantage with other auto companies (establishing industry pattern bargaining again). We will make all possible efforts to compel the transnational auto companies to respect the right of their American workforce to be part of a union, just as they recognize unions in their home countries and elsewhere around the world. We can no longer allow American workers to be second class global citizens.

Just as the UAW won true justice for autoworkers by organizing the entire industry in the 1940s, the UAW of the 21st century must renew this legacy by organizing all the auto industry and being a voice for all auto workers.

There are those who might argue that unless the UAW gains greater compensation for our members than the nonunion workers receive, there is no reason for nonunion workers to want to join the UAW. This is putting the cart before the horse. We do not want to make any unionized employer noncompetitive. When all workers in the industry have a voice as part of the union, we will have the strength to negotiate pattern agreements with the industry as a whole.

Continued focus on quality

UAW members are the strongest advocates for quality for the consumers. UAW members take great pride in the quality of our products and services, and we must continue to play a major role in championing quality. We cannot allow managers to sacrifice quality to meet production goals. Quality must come first. UAW members are committed to continuous improvement and to full participation in guaranteeing the highest quality products. The only true job security comes from producing the best products at the best value. Flexibility and innovation are crucial, with a commitment to putting the customer first.

Excessive executive compensation

The UAW is committed to maintaining a climate of mutual respect and cooperation between management and workers. We reject the rigid demarcation between labor and management, and our members want to take ownership of the process of making quality products. Rigid work rules or narrow job classifications get in the way of our members’ desire to fully contribute to improving the production processes.

We are angry and offended by inflated executive compensation that is vastly out of proportion to the compensation of our members and that undermines the atmosphere of teamwork and mutual respect. The companies must take into account that excessive executive compensation is in direct opposition to the practices of transnational competitors and undermines a renewed vision of partnership.

Protecting our retirees

We recognize the legacy of involvement and the critical role that retirees play in the UAW. We would not have achieved anything if not for the sacrifices of our retirees. We are committed to protecting their security and dignity, while understanding the complexity of retiree health care benefits that are not covered under the GM, Ford and Chrysler contracts and instead are provided by our GM, Ford and Chrysler independent trust fund, called a Voluntary Employee Beneficiary Association, or VEBA.

Protecting and growing UAW strength:
fair labor standards for supplier workers

We are deeply committed to building UAW strength and protecting both our current UAW supplier members and our members at Chrysler, GM and Ford. Over the last 20 years and during the most recent economic crisis, our supplier membership has suffered dramatically the loss of income, defined-benefit pension plans, diminished health care, and most devastating, greater and greater job and income insecurity. We must bargain provisions in our GM, Ford and Chrysler contracts that support and assist UAW-represented suppliers in achieving greater and greater productivity, quality and profitability that will support higher income and benefits for UAW supplier members without putting these suppliers or their customers at a cost disadvantage.

UAW representation on boards of directors

The 21st century UAW is committed to partnerships with our employers to achieve success in a global economy. The German model of co-determination in which workers have a voice in corporate governance has proven itself to be successful, as Germany has retained a large and robust manufacturing sector, reduced unemployment and maintained middle-class salaries for its unionized workforce. Cooperation between business, labor and government is structured into the German system, and is in the national interest. German law requires union/worker representation on their company board of directors (called supervisory boards in the German system.)

The importance of a union voice on the board of directors is evident in light of the crisis in the auto industry and the economy as a whole. To the extent that a board of directors sees the company as primarily a means to maximize returns to investors and financial interests, short-term profit-seeking can interfere with the long-term strength of the company. No stakeholder has more at risk or is more committed to the long-term success of the company than union members. Union members also have unmatched expertise and understanding at the production level that can provide valuable insights to a board of directors.

The UAW is proposing a new model for labor-management relationships that is less adversarial and more aligned with the model in highly unionized countries such as Germany. Representation on the boards of directors is part of this new model for cooperation. We know this will strengthen the companies in the long term.

 

Global solidarity

The auto companies operate worldwide, and to be an effective voice for the interests of working people, the UAW must also have a worldwide presence. Unions in other nations can provide important support for UAW efforts in the United States, and the UAW has historically and must continue to work in solidarity with our union sisters and brothers around the globe. Global solidarity among autoworkers is an important component of the UAW of the 21st century, and our bargaining proposals reflect this.

We are asking the domestic automakers to agree to respect the human rights of workers at their plants in other nations. This includes respecting the rights of workers to join independent unions and to bargain collectively.

The interests of American workers are intertwined with the aspirations of workers all over the world. Pitting worker against worker in a “race to the bottom” is harmful for every worker in every nation.

Just as the UAW built the American middle class, the UAW of the 21st century must work to build a global middle class by fighting for the universal human right to join a union and engage in collective bargaining.

Creating jobs in the United States

One of our goals is to seek investment in creating jobs in the United States, particularly in areas that have been hard hit by job losses. Just as the UAW is committed to supporting our employers’ success, it is important for our companies to honor a commitment to the nation and people who have supported them. We will bargain aggressively for major investment and new products for our American communities and especially to bring products and investment to communities that have suffered great job loss.

Companies have an ethical responsibility to show loyalty to our nation and to the workers who have contributed to their corporate growth. It is not acceptable to abandon the United States in search of places where it is possible to exploit low wages and poor working conditions. We are holding our employers to a higher standard. Americans have a right to expect American companies to serve our national interest as well as the corporate bottom line – especially when U.S. taxpayer dollars saved these companies.

Green job initiatives

The UAW seeks to work with the auto companies to creatively develop new approaches to improve energy efficiency and to spark innovation in auto technology. There is vast potential for “green jobs” to provide employment opportunities in future growth industries, while also protecting the environment for our children and grandchildren. We are proposing cooperative ventures with the auto companies to provide American leadership for green technology. The UAW will contribute resources and training expertise for entrepreneurial ventures to promote environmentally-friendly innovations in transportation and in general energy usage.

Auto Talks


It all starts with a handshake.
But four years ago, this longstanding, across-the-table tradition was followed by one heck of a roller-coaster ride that would give pause to even the bravest amusement park fan.

A July 24, 2007, New York Times story dubbed upcoming Big Three negotiations “the most crucial talks in a generation.” Six weeks later, they ran this headline on a grim Labor Day story: “For UAW, a year of uncertainty.”

It was – with apologies to Charles Dickens – not the best of economic times.

On Sept. 24, 2007, more than 73,000 UAW General Motors members went on strike against the company over job security, economic issues, benefits for active workers and winning investment in future products. Two days later, the UAW national bargaining team reached a tentative agreement with GM in the wee hours. Highlights included job security and unprecedented product guarantees. On Oct. 10, thousands of UAW-represented Chrysler workers went on strike for nearly six hours before settling with the company. And in November, UAW Ford Motor Co. workers ratified a new contract with product and investment commitments.

One of the most important aspects of the labor agreements reached during 2007 bargaining was the establishment of an independent trust fund called a Voluntary Employee Beneficiary Association, or VEBA, to provide protections for medical benefits for UAW-represented retirees from GM, Ford and Chrysler. (On Jan. 1, 2010, the VEBA took over responsibility for providing retiree medical benefits.)

But who would have guessed that by late 2008 and into 2009, our nation’s economy – and the auto industry in particular – would enter its deepest crisis since the Great Depression.

It was indeed the worst of times.

Almost overnight, demand for new vehicles fell from an annual rate of more than 17 million units to an annual rate under 10 million units.

Former UAW President Ron Gettelfinger, along with the CEOs of GM, Ford and Chrysler, met with House and Senate leaders and later testified before Congress to describe the dire situation facing the industry. In the final weeks of his administration, President George W. Bush granted GM and Chrysler federally guaranteed loans that allowed them to survive into early 2009. Within a month after taking the oath of office, President Barack Obama appointed an Auto Task Force to review available options.

Without a government-supervised and supported restructuring of their debt, GM and Chrysler would have collapsed, throwing millions of American workers on the street and leaving retirees without medical benefits of any kind. And even though Ford had mortgaged everything for a $26 billion loan, if GM and Chrysler had collapsed, the supplier industry would have failed as well, in turn affecting Ford.

Current UAW contracts with Ford, GM and Chrysler will expire at midnight on Sept. 14.

Between now and then, the union’s national bargaining teams, who represent UAW members employed by each of the domestic automakers, and the companies’ respective teams, will open negotiations in late July, spend long days and nights hammering out a new tentative agreement and present it to our membership for a ratification vote.

What follows is a comprehensive look at the amazing turnaround following this historic auto industry crisis and the UAW’s bargaining goals for 2011 auto negotiations.

Perhaps this time, amid growing signs of improvement, they’ll open bargaining with a high-five – or maybe even a fist-bump.

Jennifer John

Auto Talks continued continue

From the president


<p>UAW activists support public sector workers in Lansing, Mich., at an April rally.</p>

UAW activists support public sector workers in Lansing, Mich., at an April rally.

Honoring our retirees, honoring solidarity

 We should all be extremely grateful to our UAW retirees.

Our UAW retired sisters and brothers and their surviving spouses made many sacrifices to build our union and to bargain the wages, benefits and language that won the dignity and respect we enjoy today.

Even after setbacks caused by the economic crisis over the last few years, we still enjoy some of the best economic agreements and some of the best contract language in the United States in our Ford Motor Co., General Motors Co. and Chrysler Group LLC UAW contracts.

UAW retirees are recognized nationally as the most active group of retirees in the political process and in fighting for economic and social justice for all in our society.

As a union, our members take great pride in our record and tradition of bargaining for and winning the greatest possible protection for our retirees.

In the economic turmoil beginning in 2005 and peaking in 2009, our active members made great additional sacrifices in order to give greater protection to our retired members. The strong bond between our active and retired UAW members is a UAW characteristic that we can all be proud of.

In the upcoming UAW Chrysler, Ford and GM bargaining, we are committed to remembering and protecting our retirees. While retiree health care benefits are now covered by our UAW Voluntary Employee Beneficiary Associations (VEBAs) and not by these companies or contracts, we will still bargain for protections for our retiree pensions and economic well-being.

It is also very important that those of us who are from GM, Chrysler and Ford remember how fortunate we are in our contracts in comparison to our UAW sisters and brothers in the supplier sector – both active and retired. Over the last 20 years and during the most recent economic crisis, our supplier membership has suffered even more dramatically than our Big Three members with the loss of income, defined-benefit pension plans, diminished health care and most devastating, greater and greater job and income insecurity.

Supplier sector UAW retirees have far less in pensions and health care benefits than our big auto retirees. Many whose companies did not have the resources of Ford, GM and Chrysler suffered nearly a total loss of health care benefits in bankruptcy proceedings and court decisions. Many had minimal pensions further reduced. Active supplier members have also suffered much greater losses than our active Big Three members.

Solidarity and a social conscience demand that we have a strategy and plan and are willing to fight to protect and raise the standard of living for all UAW members.

We must be prepared to take this fight on through bargaining and through political and legislative activism and action.

The 2012 elections are an exceptionally important component in the overall struggle and strategy to win economic and social justice for all. The Republican Party has moved to the extreme right and has demonstrated very clearly, in state after state they control, they are determined to destroy collective bargaining rights and the middle class by shifting more and more burden to us, while giving more and more wealth to corporations and the ultra wealthy.

Because of Republican extremism, I think there is a great opportunity for a “coalition of caring” or a “coalition of conscience” to rebuild a social justice movement that drives a landslide victory for Democrats in 2012.

This social justice movement must be about much more than just winning in 2012. It must be about rebuilding the American middle class by strongly supporting workers’ rights to organize and collectively bargain. It must be about creating good-paying jobs and rebuilding our infrastructure in the United States to be able to compete globally in the 21st century. It must be about the right for every child and every person to have the opportunity to get an excellent education to enable them to make their greatest possible contribution to society.

To succeed in bargaining and in winning justice for all in our society, we must all be active, we must all contribute both in our contract campaigns, and in our political and legislative campaigns. We must all be committed to lifelong activism for justice for our families and for all of society.

Dana deal protects wages, health care

UAW, USW WORKERS IN 6 STATES OK CONTRACT


Members of the UAW and the United Steelworkers (USW) have overwhelmingly ratified an agreement with Dana Corp. for workers in Ohio, Pennsylvania, Michigan, Texas, Kentucky and Indiana.

Members approved the four-year agreement by 86 percent on July 24.

The deal, approved July 27 by a U.S. bankruptcy court, protects wages and health care for active workers and pensions and health care for retired workers. Also, it helps Dana emerge from bankruptcy with the potential for future success while preserving jobs and defending the standard of living for UAW and USW workers.

“We went from being closed to gaining 130 new jobs,” said Scott Williams, president of UAW Delphi Local 1765 in Lima, Ohio. “It wasn’t without sacrifice, but we gained protections that we would not have if there was no union.”

The agreement covers more than 2,300 UAW members and 6,200 UAW retirees. belonging to UAW locals in Lima; Pottstown, Pa.; Auburn Hills and Rochester Hills, Mich.; Longview, Texas; and Elizabethtown, Ky.; and for USW locals in Fort Wayne and Marion, Ind., and Henderson, Ky.

“This agreement will prove to be an important victory snatched from the jaws of a failed bankruptcy system. It is an example of the UAW using a combination of tried and tested bargaining strategies along with innovative new capital strategies,” said UAW Vice President Bob King, who directs the union’s Independents, Parts and Suppliers Department. “These strategies, along with great solidarity from our local union leadership and membership, made this victory for our UAW Dana members and all UAW members possible.”

Also, the contract provides requirements for the increased likelihood of future profitability for both Dana and union workers. The requirements include limitations on debt, minimum liquidity and a cap on new cash investment.

Centerbridge Capital Partners, an investment company recruited and recommended by the UAW and USW, will invest $500 million in Dana and sponsor the plan to help Dana exit bankruptcy.

“Our members at Dana did a tremendous job under difficult circumstances,” said UAW President Ron Gettelfinger, “and we were able negotiate an agreement that protects workers and their families.

“But this fight doesn’t stop at the bargaining table. We also need political change in Washington, D.C., to prevent companies from attempting to manipulate the bankruptcy laws in order to evade their responsibilities to workers and communities.”

Also in the contract, Dana will pay more than $750 million to Voluntary Employee Beneficiary Association (VEBA) trust funds for payment of 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 agreement highlights 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 of seniority.

• A moratorium on moving work out of UAW and USW plants to nonunionized facilities.

• A commitment to source new product lines to UAW- and USW-represented worksites.

UAW Ford workers ratify modifications to contract


For Garry Sommerville representing UAW Local 3000 members on the union’s Ford National Negotiating Committee was bittersweet.

Joining the committee in December, Sommerville was soon part of a difficult set of mid-contract negotiations, requiring painful changes to help Ford Motor Co. remain competitive after the company suffered $14.8 billion in losses in 2008.

Asking members to give up hard-won gains wasn’t easy, said Sommerville, the local’s plant chair at Ford’s Auto Alliance Inter-national facility in Flat Rock, Mich.

But contract changes were part of an effort to “help keep the company in business and keep them from having to ask for a loan from the federal government,” he said.

UAW Ford members ratified modifications to the 2007 labor agreement, as well as funding changes to the independent Voluntary Employee Beneficiary Association (VEBA) trust for retiree health care, in March.

Fifty-nine percent of production workers and 58 percent of skilled-trades workers ratified the agreement in balloting at UAW Ford locals across the United States.

“UAW members have stepped up to make the difficult decisions necessary to deal with the reality of the current economy, the deteriorating auto industry as a whole and specifically the negative impact the economic climate is having on Ford Motor Co.,” said UAW President Ron Gettelfinger.

“We are facing an unprecedented loss of sales and revenue at Ford,” said UAW Vice President Bob King, who directs the union's National Ford Department.

“Our bargaining committee made an extraordinary effort to negotiate changes in a responsible way that will help Ford be competitive, while still protecting our active and retired members. In these very tough times we were still able to win additional commitments to keep manufacturing and assembly jobs here in the United States.”

UAW members ratify settlement agreement

Short-term bankruptcy helps Chrysler survive


<p>UAW President Ron Gettelfinger and Vice President General Holiefield meet the news media after the UAW Chrysler Council meeting April 27 in Sterling Heights, Mich. Photo: ROGER KERSON</p>

UAW President Ron Gettelfinger and Vice President General Holiefield meet the news media after the UAW Chrysler Council meeting April 27 in Sterling Heights, Mich. Photo: ROGER KERSON

April ended with UAW members at Chrysler LLC ratifying a settlement agreement with the company, Italian automaker Fiat and the U.S. Treasury Department, and President Obama announcing Chrysler would file for “a quick and efficient” Chapter 11 bankruptcy to eliminate its remaining debt.

Eighty-two percent of production workers and 80 percent of skilled-trades workers ratified the agreement in April 29 balloting at UAW Chrysler locals across the United States. Ninety percent of UAW-represented office and clerical workers voted in favor of the agreement, along with 94 percent of engineering workers.

“This has been a challenging time filled with anxiety and uncertainty for our membership, said UAW President Ron Gettelfinger. “Our members have responded by accepting an agreement that is painful for our active and retired workers, but which helps preserve U.S. manufacturing jobs and gives Chrysler a chance to survive.”

The agreement, which became effective May 4, met Treasury requirements for continued loans to Chrysler. It includes modifications to the union’s 2007 collective-bargaining agreement with Chrysler, as well as the agreement establishing a Voluntary Employee Beneficiary Association (VEBA) trust.

The settlement agreement includes commitments from Fiat to manufacture a new small car in one of Chrysler’s U.S. facilities, and to share key technology with Chrysler.

On April 30 Obama announced that Chrysler would seek bankruptcy protection after a small group of investors, including some hedge funds, would not agree to make comparable to sacrifices agreed to by UAW members and other company stakeholders.

Promising a quick and efficient bankruptcy proceeding, Obama said the process will not disrupt the lives of Chrysler workers or affect consumers’ ability to buy a Chrysler vehicle or get it serviced.

Immediately following Obama’s news conference, Gettelfinger announced that the union will seek court approval of the agreements ratified by UAW members.

“The UAW agreements have been ratified by our membership and approved by the United States Treasury, Chrysler and Fiat,” said Gettelfinger. “We believe it is in the best interests of all concerned for the bankruptcy court to give those agreements swift and complete approval.”

“Once again, UAW members stepped up to the plate and acted responsibly,” said UAW Vice President General Holiefield, who directs the union’s Chrysler Department. “This agreement gives Chrysler a chance to rebuild and participate in the eventual recovery of the U.S. vehicle market.”