DETROIT -- UAW President Ron Gettelfinger says he has seen signs of progress in talks with Delphi Corp. and is awaiting the results of a financial review of the Chrysler group before the union decides on a health care concession package for the automaker.
Talking with reporters after a dinner speech at the Automotive News World Congress, Gettelfinger said he saw progress in Delphi's recent decision to pull its controversial labor concession package off the table and delay bankruptcy court consideration of major pieces of a $500 million executive compensation package.
Gettelfinger said he met with Delphi CEO Steve Miller just before Christmas. But he declined to discuss specifics of the union's talks with Delphi and General Motors to fashion a new labor agreement for the 25,000 Delphi workers represented by the UAW.
If Delphi cannot reach agreement with the UAW and its five other unions, the supplier could ask the U.S. Bankruptcy Court in New York to terminate those labor contracts. Gettelfinger said the UAW might strike if Delphi pursues that option.
Gettelfinger cautioned that the union intends to hold the supplier to its current contract unless a new agreement can be negotiated and then ratified by the rank and file.
After Delphi filed for Chapter 11 reorganization last Oct. 8, Delphi asked the UAW to accept drastic wage cuts for hourly workers - from $27 an hour to $9, in some cases. The supplier later raised the offer to about $10.50 an hour, a proposal Gettelfinger called insulting .
GM may offer financial assistance to Delphi in the form of buyouts or by allowing Delphi workers to return to the automaker, Delphi's former parent.
Gettelfinger said the UAW again has contracted with Lazard Ltd. in New York to examine Chrysler's books before negotiating a new health care package for Chrysler retirees similar to those granted to GM and Ford Motor Co.
Lazard looked at Ford and GM financial data before the UAW agreed to health care concessions late last year. The concessions saved each automaker $800 million to $1 billion a year on health care.
Gettelfinger said he did not know when the Lazard report would be ready. He said the health care concessions to GM and Ford had been excruciatingly painful to the union, "but it was the right thing to do."
During the question-and-answer portion of his dinner speech, though, Gettelfinger said he saw no reason to eliminate the union's Jobs Bank program with the Big 3 when the UAW's master contract with the automakers expires in 2007.
The program, which pays workers nearly their full wages and benefits if idled by layoff, was established at the behest of the manufacturers, he said. The union gave up other benefits to get the bank, which was to act as an incentive for the automakers to bring work inside the company to keep hourly employees working, he said.
The program has not had a material impact on GM's costs, Gettelfinger contended. According to published reports that could not be independently verified, GM has said the program costs it about $500 million a year.
Tom Stallkamp, the former Chrysler Corp. president who is industrial partner with Ripplewood Holdings LLC, said the Jobs Bank has outlived its usefulness.
In remarks after a panel appearance earlier in the day, Stallkamp said the Jobs Bank was put in place nearly two decades ago to keep talented people during cyclical downturns in the auto industry. But significant changes in the industry mean that volumes at the Big 3 won't be returning to historic levels.
The bank could be a major target for change in the next master contract negotiations, Stallkamp said: "It's a quick thing that could be changed that is no longer logical, if it ever was."
Delphi has proposed eliminating the bank, which CEO Miller says costs the company about $400 million annually.
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