UAW fears 2-tier auto pacts

The Baltimore Sun

DETROIT -- United Auto Workers members harbor widespread concern about a two-tier pay and benefits plan that they believe may come out of this year's contract negotiations with Detroit automakers.

The plan essentially creates a situation in which new hires never catch up to the wages and benefits of current Detroit autoworkers.

"We're worried about the second-tier people," said Daniel Gibson, 41, a Delphi Corp. worker from Athens, Ala., who is in Detroit this week for the 2007 UAW Special Convention.

"The companies are treating them like second-class citizens. They pay dues, but they don't get the benefits that full-time workers have. They need cost-of-living adjustments. They need better health care benefits. They need a pension."

A few workers accept the idea as a way to help the companies make some of the cost-saving changes necessary to compete with Toyota and Honda.

But most say agreeing to the two-tier system, such as the one in place at Delphi Corp., is a way to divide and weaken the union in less than a generation and ensure that middle-aged union members won't have secure pension and health care benefits when they retire.

The union now laments the two-tier structure, listing the topic as a key issue in its proposed collective bargaining resolution.


"More and more employers in all sectors are outsourcing work, creating an underclass of 'perma-temps' who lack full wages and benefits, are employed by outside contractors and have no job security," according to documents prepared for the union for the convention that began yesterday and continues today.

"We will bargain for enhanced job status, better pay and benefits and union protection for temporary, contract and contingent workers."

And UAW President Ron Gettelfinger said yesterday that the union will fight to protect wages, health care and pensions for its members.

But some workers fear that that won't happen if the union doesn't demand equal treatment for all workers. And they fear that the union won't do that.

In 2003, the UAW already accepted a plan to offer lower wages - $14 an hour instead of $27 - for new hires at Delphi.

At Chrysler, the union allowed the hiring of temporary workers at its Belvidere, Ill., plant. Those workers earn $18 an hour, can be fired at any time and are not eligible for the jobs bank. The jobs bank is the UAW benefit through which full-benefit union workers continue to draw most of their wages, even when they are laid off.

Robert S. "Steve" Miller Jr., Delphi's chairman, said in February that he expects the automakers will follow Delphi's lead and negotiate two tiers of pay and benefits this year.

Gerald C. Meyers, a professor of management at the University of Michigan and former chairman and chief executive of American Motors Corp., said workers are right to think that the two-tier wage plan is growing in popularity among unionized employers.

"The two-tier thing is something else, and it's coming at us like a freight train," Meyers said. "It's accepted by the UAW in certain quarters already. ... The thing that is new is that it's successful. It hasn't caused a labor disruption. That removes some of the strength of the UAW arguing that you can't do it. I think we're going to see more of it."

That's why the two-tier system is a primary focus for many of the workers attending this week's convention.

Several of the workers said yesterday that they hope to change that course this week at the convention and going into the summer contract talks with General Motors Corp., Ford Motor Co. and DaimlerChrysler AG. Negotiations are expected to begin formally in July. The contracts expire in September.

'Divide the union'

"What it does is divide the union," said Gibson, the Alabama Delphi worker.

Claudia Perkins, a truck driver at GM's Delta Township plant near Lansing, Mich., agreed.

"It ain't rocket science," Perkins said. "The company wanted to get rid of the high wages, so they brought in the temporary people. With the bulk of high-seniority workers retiring, they'll have lower wages across the board."

And when those people get asked to vote up or down on whether to retain benefits for the retirees that allowed them to be treated like second-class citizens, Perkins said, they'll let those benefits go.

"It's time to draw the line," said Herb Wilson, a worker from Hercules Steel Co. in Romulus, Mich. "Two-tier pits our younger people against our older people. I think our union forefathers are turning over in their graves."

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