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Members of the UAW at seven Mack Truck facilities in Pennsylvania, Maryland and Florida on May 30 voted 84 percent in favor of a new 40-month contract covering 1,700 workers.
The agreement, in effect from June 1, 2009, through Oct. 1, 2012, creates a UAW-managed Voluntary Employee Beneficiary Association (VEBA). The VEBA will permanently assume the obligation of health benefits to roughly 9,000 current UAW retirees, surviving spouses and dependents, as well as future UAW retirees.
Mack will contribute $525 million to the VEBA, which is subject to approval of the U.S. District Court for the Eastern District of Pennsylvania.
"UAW negotiators remained focused on bargaining a new agreement that would protect active and retired workers," said UAW President Ron Gettelfinger.
"Our members at Mack Truck never gave up," said UAW Vice President General Holiefield, director of the union's Heavy Trucks Department. "They fought long and hard and have a new contract that will maintain jobs during these uncertain times in the heavy trucks industry."
The agreement includes a $2,000 adjustment bonus for previous years where bonuses were not paid while on contract extension, increased tuition reimbursement for laid-off workers and a payment of $300 each year for retirees and $165 for surviving spouses.
The agreement also enhances health and safety language, and increases supplemental employment benefits for Mack workers.
"In light of what is happening with the economy and American manufacturing, this was the best contract that could be brought back," said Ed Balukas, president of UAW Local 677, which represents employees in Pennsylvania's Allentown, Lower Macungie, Middletown and Dauphin County facilities.
UAW members had been in negotiations with Mack since 2007, but the talks faced numerous setbacks, including the nation's economic downturn and its effect on the heavy truck industry. The new contract was ratified in a weekend vote, ending an extension of a 2004 labor agreement that expired in October 2007.
"The new agreement gives us a sense of job security that's going to bring some stability for the next 3 1/2 years of the contract. That is something that we have not had," said Dave Perkins, president of UAW Local 171 in Hagerstown, Md., and chairman of the UAW Mack National Negotiating Committee.