Fiat Chrysler said to offer higher wages in new pact

Fiat Chrysler Automobiles is offering so-called second-tier United Auto Workers members as much as $29 (U.S.) an hour — up from the $25 previously proposed — under a new tentative agreement which avoided a strike by 40,000 union members, said two people familiar with the matter.

The second-tier workers would almost match veteran members’ wages — from a maximum of $19.28 now — after an eight-year grow-in period, said the people, who asked not to be identified because the details of the accord haven’t been made public. Senior workers are offered the same raises and bonuses as in the original tentative pact, which members voted down, said one of the people.

There’s no cap on the number of second-tier workers, the people said. Spokesmen for the union and company declined to comment on the details of the agreement.

Getting this new deal ratified will be vital for both sides as UAW president Dennis Williams seeks to quiet unrest among his members and solidify his leaders before seeking similar but more lucrative deals with General Motors and Ford. Fiat Chrysler chief executive officer Sergio Marchionne needs a deal that holds down labour costs and maintains flexibility for the least profitable of Detroit’s three carmakers.

“We heard from our members, and went back to FCA to strengthen their contract,” Williams said in a statement. “We have made real gains and I look forward to a full discussion of the terms with our membership.”

The UAW National Chrysler Council, made up of leaders from union locals, meets in Detroit on Friday to discuss the accord and whether to send it to a vote.