UAW Members Likely To Ratify GM Contract; Chrysler Strike Deadline Nears

Main Category: Health Insurance / Medical Insurance
Also Included In: Seniors / Aging
Article Date: 11 Oct 2007 - 7:00 PDT

email to a friend   printer friendly   opinions  

United Auto Workers rank-and-file members at General Motors are expected to ratify a tentative contract between the union and the automaker that would establish a voluntary employees' beneficiary association, under which UAW would assume GM's retiree health care liabilities, the Detroit Free Press reports.

UAW locals representing more than three-quarters of workers by the end of Tuesday had voted on the contract. A Free Press count of those votes showed that most of the branches had approved the deal while eight had rejected it. The Free Press estimates the approval rate was about 63% at the end of Tuesday.

Meanwhile, a union dissident and a former UAW leader on Tuesday sent a letter to the Securities and Exchange Commission saying that it should block GM from issuing a $4.4 billion convertible note to UAW to help fund the VEBA. Gregg Shotwell, a GM employee and activist, and Frank Hammer, a retired GM worker and former UAW official, in their letter questioned the legality of the note, which if converted into stock would make UAW GM's largest shareholder. The note, which would amount to about 15% of the VEBA's funds from GM, is critical to the deal, according to the Free Press.

An investigation by SEC could delay creation of the VEBA, the Free Press reports (Merx/Hyde, Detroit Free Press, 10/10).

Chrysler Nears Strike Deadline
Chrysler Group and UAW negotiations extended late into Tuesday night with slow progress as the groups near an 11 a.m. strike deadline, according to people close to the talks, the Wall Street Journal reports. Chrysler is pushing for cost-savings measures beyond those granted to GM in its tentative contract with UAW, sources said. One issue is the terms under which Chrysler would fund its VEBA (Stoll/Valcourt, Wall Street Journal, 10/10).

According to the AP/Chicago Tribune, the negotiations have focused on the amount Chrysler would put into its VEBA, which would relieve the automaker of about $18 billion in retiree health care liabilities. Chrysler also entered the discussions seeking to obtain health care concessions granted to GM and Ford Motor in 2005, according to the AP/Tribune.

Chrysler spokesperson Michele Tinson said that discussions were continuing through the night (Durbin/Krisher, AP/Chicago Tribune, 10/10).

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.

• Additional
• References
• Citations