New Contract Approved by United Auto Workers Union Members

The United Auto Workers (UAW) union members have voted in favor of approving a new contract with General Motors (GM), making GM the first Detroit automaker to secure a ratified deal that could potentially resolve a lengthy and contentious labor dispute.

A spokesperson for the union confirmed on Thursday that the official totals were recorded in a spreadsheet. The outcome of the vote was closer than expected, especially after the UAW's recent celebrations of victories on several key demands, which resulted in six weeks of targeted walkouts against GM, Ford, and Stellantis (the manufacturer of Jeep, Dodge, and Ram vehicles).

As of Thursday, the new contract had a significant lead in voting at Ford and Stellantis. At Ford, 66.7% of the votes were in favor of the contract, while at Stellantis, 66.5% of the votes supported it.

Voting is still ongoing at Ford and is expected to continue until early Saturday. Only two large factories in the Detroit area and some smaller facilities are left to be counted. At Stellantis, the tallies are expected to be complete by Tuesday, with only three Detroit-area factories remaining to vote.

What union members will get

The three contracts, if approved by union members, will result in a significant increase in pay for autoworkers. The wage gain will amount to a 33% increase, including cost-of-living adjustments. By April 2028, top assembly plant workers will be earning approximately $42 per hour.

Voting is currently underway at Ford, with 66.1% of workers voting in favor of the contracts so far. The remaining large factories are still counting the votes. At Stellantis, 66.5% of workers have voted in favor of the deal as of Thursday, with some large factories yet to finish casting their ballots, according to the UAW website's vote tracker.

The outcome of the vote has been closer than expected, with some GM workers expressing dissatisfaction over the pay raises. Longtime employees feel they should have received larger raises, similar to those given to newer workers. Additionally, they are seeking a bigger increase in their pension.

Keith Crowell, the local union president in Arlington, has highlighted the diverse group of workers at the plant, including full-time, part-time, and temporary hires, as well as longtime assembly line employees. Full-time temporary workers have expressed satisfaction with the significant raises they have received and the opportunity to reach top union pay. However, many longtime workers believe that the immediate 11% pay raises offered in the deal are insufficient to compensate for the concessions made to GM in 2008.

During the Great Recession, the union made significant concessions to help the automakers overcome their financial difficulties. This included accepting lower pay for new hires and giving up cost of living adjustments and general annual pay raises. However, despite these sacrifices, both GM and Stellantis (formerly known as Chrysler) still had to go through government-funded bankruptcies.

"There was something in there for everybody, but everybody couldn't get everything they wanted," said Crowell. "At least we're making a step in the right direction to recover from 2008."

2008 concessions

UAW President Shawn Fain has emphasized the need to make up for the concessions made in 2008, pointing to the automakers' strong profits as justification.

President Joe Biden has praised the resolution of the strike as an early victory for his worker-centered economy. However, the success of the tentative contracts will depend on the ability of automakers to continue generating profits in a competitive market, especially as they shift towards electric vehicles.

Before the tentative deals were reached at the end of last month, thousands of UAW members participated in targeted strikes starting on September 15. Rather than striking at one company, the union chose to target individual plants at all three automakers. At its peak, around 46,000 of the union's 146,000 workers at the Detroit companies were on picket lines.

Under the new contracts with all three companies, longtime workers would receive 25% general raises over the duration of the contracts, with 11% upfront. Including cost of living adjustments, their total increase would amount to approximately 33%, according to the union.

New Contract Negotiation Results in Changes to Wage and Retirement Plans

The recent contract negotiation between the companies and their employees has led to significant changes in wages and retirement plans. One of the key changes is the elimination of lower tiers of wages for newer hires, which will help create a more equitable pay structure within the organizations.

Furthermore, the negotiation resulted in a reduction in the number of years it takes for employees to reach top pay. This change will provide newer hires with the opportunity to earn higher wages at an earlier stage in their careers.

Another important aspect of the contract negotiation was the discussion around retirement plans. While many newer hires expressed a desire for defined benefit pension plans, the companies ultimately agreed to contribute 10% per year into 401(k) plans instead. This compromise ensures that employees will still receive retirement benefits, albeit through a different type of plan.