LET’S MAKE A DEAL

Tentative contract promises to eliminate wage disparities and reduce rising health costs

UAW, Fiat Chrysler address two-tiered wages, health costs in tentative agreement,

DETROIT— In a tentative agreement hammered out Tuesday night, the UAW union and Fiat Chrysler Automobiles agreed to work to eliminate the thorny issue of a two-tier wage structure over time and to address the need to reduce rising health-care costs that could threaten the future vitality of the industry.

The details of the four-year agreement, which affects FCA’s 39,000 unionized employees, must be ratified by the union membership.

UAW president Dennis Williams said the tentative agreement sets a pattern he feels GM and Ford can match, but suggested he will seek more economic gains from the larger and more profitable companies. FCA CEO Sergio Marchionne and Williams confirmed they had reached the agreement during a quickly called and jubilant news conference in Detroit.

The two men said they would not release details ahead of meetings with union leadership, who will in turn take the terms to their locals.

But in broad strokes, Marchionne said the inequity of paying entry-lev- el workers a lower wage for the same work, a disparity referred to as twotier wages, is addressed in the agreement.

Under the new contract, Marchionne said the automaker’s workers will be provided with a path to a higher wage and suggested that the two-tier wage structure, put in place in 2007, will eventually go away.

What Marchionne and Williams did not say is how long that will take.

Trey Durant, a 20-year employee at a Fiat Chrysler Mopar parts facility near Chicago, said getting equal wages for his colleagues is a top issue.

“Working in the same facility, side by side with someone who has a different wage than you was a bad idea, even though I know why they had to do it when times were tough,” Durant said. “I want my brothers and sisters to be at full wage also.”

Durant wonders if the solution is to follow the lead of Canadian auto workers, who achieve the top wage after 10 years — but he would like to see a shorter grow-in period.

Also key to the pact is the need to reduce health-care costs. Williams has made public his vision of a health-care benefits co-op that pools the active workers at all three companies for purchasing clout in dealing with heath-care providers in an effort to secure cost savings.