Rejected deal points to strikes at Fiat Chrysler
• Fiat Chrysler Automobiles NV’s U.S. workers soundly rejected a fouryear contract the automaker had agreed on with the UAW, the union said on Thursday, setting the stage for at least localized strikes against the automaker.
The tentative agreement was voted down by 65 per cent of the 40,000 unionized workers who work at 37 Fiat Chrysler plants, the fourth-largest U.S. automaker by sales.
UAW president Dennis Williams convened about 300 union representatives of Fiat Chrysler locals in suburban Detroit to consider next steps.
“We will gather the issues together and notify (Fiat Chrysler) that further discussions are needed,” Williams said in a statement.
In the aftermath of the rejection, which reflects growing discontent among autoworkers about stagnant pay, some Fiat Chrysler locals are pre- paring to send workers out on strike.
Alternatively, the UAW may invite Fiat Chrysler back to the negotiating table, or the could decide to turn its attention to one of the other Detroit Three companies — GM or Ford.
Canadian workers at the Detroit Three will hold their own negotiations in 2016.
There hasn’t been a sustained UAW strike in decades, and this makes the first time a national contract negotiated between the UAW and a major carmaker has been rejected since 1982. It is the first time since 1976 that a contract with the company chosen by the union for pattern bargaining has failed.
Fiat Chrysler said it was disappointed by the tentative pact’s rejection.
A localized strike against Ford Motor Co. was a possibility even before the Fiat Chrysler vote. The UAW’s top negotiator at Ford on Tuesday said he has authorized a strike as early as Sunday by 7,500 workers at a factory near Kansas City, Mo., that builds the company’s best-selling F-150 pickup truck, a linchpin of Ford’s global profits.
Fiat Chrysler union members who voted “no” said they were motivated by concerns about the carmaker’s two-tier pay system, under which recently-hired workers earned about US$19 an hour, while workers hired before 2007 earned base wages of US$28 an hour.
Fiat Chrysler has the highest share, among top automakers, of second-tier workers, 45 per cent of its production workforce, and therefore has lower labour costs.
The proposed Fiat Chrysler deal would have narrowed, but not closed, the gap between the two tiers of workers.
In addition, UAW members were disappointed that the new contract failed to cap at 25 per cent the number of lower-paid, second-tier workers in the company’s workforce.
Union leadership had previously pledged to pursue such a cap when it was pushing for ratification of a prior contract that took effect in 2011.
Members also said they needed further clarification of the contract’s proposed system of co-operating with workers at the other two Detroit automakers to cut health-care costs. Workers said they are concerned about a pending increase in federal tax on premium health care, which will affect them after it takes effect in 2018.
“People wanted to know why they stand to lose benefits or pay more money when the premium health-care tax kicks in,” said Bill Parker, a veteran worker at a plant in Sterling Heights, Mich.
Fiat Chrysler shares were l i tt l e changed Thursday, closing up two per cent at US$13.52.