United Auto Workers Sets Monday Morning Strike Deadline For General Motors

Main Category: Health Insurance / Medical Insurance
Also Included In: Seniors / Aging
Article Date: 26 Sep 2007 - 2:00 PDT


United Auto Workers President Ron Gettelfinger and Vice President Cal Rapson early Monday morning said that union members would walk out of General Motors on a national strike if a contract deal is not reached by 11 a.m., the Detroit Free Press reports. Negotiations continued into the early hours of the morning (Merx, Detroit Free Press, 9/24).

Ford Motor and GM in August formally asked UAW to assume responsibility for the health care benefits of more than 1.5 million working and retired employees. The companies would transfer retiree health care obligations to an independent trust fund, known as a voluntary employees' beneficiary association, which the union would manage.

Earlier this month, UAW selected GM, which has been the strongest proponent among the automakers of creating a VEBA, as its lead negotiation partner. The GM contract, which expired on Sept. 14, is being extended on an hourly basis. Contracts with Ford and Chrysler Group have been extended indefinitely while negotiations between UAW and GM are under way.

A key dispute in the VEBA negotiations has been a gap of billions of dollars between the automaker's proposed funding level and the union's desired amount (Kaiser Daily Health Policy Report, 9/21). Negotiations on Friday yielded a general framework on a VEBA, and the talks centered on financial issues regarding the trust during the weekend, according to people close to the talks.

GM last week said that if a deal including a VEBA is not reached, the automaker would move substantial production abroad. UAW has demanded job security agreements in exchange for a VEBA (Detroit Free Press, 9/24).

Outstanding Issues
According to the Wall Street Journal, one issue being addressed is the size of the signing bonus to union members for ratifying the contract. The bonus could be as much as $5,000, the Journal reports (McCracken/Stoll, Wall Street Journal, 9/24). Other issues are how much GM will pay into the VEBA and how much will be paid in cash versus stock, according to the AP/San Francisco Chronicle.

If an agreement is reached, a majority of GM's UAW members would have to ratify the contract (Durbin, AP/San Francisco Chronicle, 9/24). According to the Washington Post, Ford and Chrysler are expected to pursue a deal similar to the one reached by GM.

Some former UAW officials and activists in the union already are critical of the plan to develop a VEBA and are going to push to defeat ratification of such a contract, the Post reports (Freeman, Washington Post, 9/24). Harley Shaiken, a labor expert at the University of California-Berkeley, said that if a contract deal is not reached by the strike deadline, UAW could follow through with its threat or extend the deadline to finish final points (Krolicki/Carey, Reuters/Boston Globe, 9/24).

Industry observers have said that they do not think UAW will strike because of the weak positions both sides are in (Wall Street Journal, 9/24).

Comments
"It is our desire to reach an agreement without a strike, and we have demonstrated this by staying at the bargaining table up to this point," Gettelfinger wrote in a memo to local union leaders (AP/San Francisco Chronicle, 9/24).

Rapson in a statement said, "[GM's] disregard for our members has forced our bargaining committee to take this course of action."

GM in a statement released after UAW announced the strike deadline said, "The contract talks involve complex, difficult issues that affect the job security of our U.S. work force and the long-term viability of the company. We are fully committed to working with the UAW to develop solutions together to address the competitive challenges facing General Motors. We will continue focusing our efforts on reaching an agreement as soon as possible" (Detroit Free Press, 9/24).

Shaiken said, "This is not an idle threat. A strike deadline is not meant for show. But it is possible that this will be a long night with a handshake at the end of it" (Reuters/Boston Globe, 9/24).

Reprinted with kind permission from http://www.kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, or sign up for email delivery at http://www.kaisernetwork.org/dailyreports/healthpolicy. The Kaiser Daily Health Policy Report is published for kaisernetwork.org, a free service of The Henry J. Kaiser Family Foundation© 2005 Advisory Board Company and Kaiser Family Foundation. All rights reserved.

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