Well, well. The word “strike” has returned to the UAW lexicon.
The union struck on Saturday at a Lear Corp. plant in Hammond, Ind., that makes seats for Ford Motor Co.’s Chicago Assembly Plant.
By Monday, the 760 Lear workers of UAW Local 2335 were back on the job. In hand was a tentative contract that met their primary demand: an end to a two-tier wage system that pays new hires less than veteran workers for the same jobs. A ratification vote is set for this Sunday.
There are two things worth noting in this matter. Two-tier wages will be under attack when the UAW begins contract negotiations with the Detroit 3 next year. And second, the union is more likely to go nuclear with a strike than at any time since 2007.
The strike at Lear was indeed a rare sighting.
The last time the UAW really hurt Detroit 3 production with a stoppage was in 2007, and that was a half-hearted 41-hour strike at General Motors that UAW leadership engineered to get the rank and file to blow off steam over a concessionary contract. The contract included a wage freeze, the advent of two-tier wages for new hires and the transfer of hourly retiree health care to an independent trust.
Since then, it’s been quiet. The last four-year UAW contract with the Detroit 3 in 2011 was decidedly viewed by workers as pro-company. Workers received no raises, slightly better bonuses and overall cost increases to the companies below the rate of inflation.
Today, though, the rank and file is restless. And it’s not just at the UAW.
Canadian auto workers are also showing flashes of militancy.
I was at the UAW Constitutional Convention in June when Jerry Dias, president of Unifor, the Canadian union that succeeded the Canadian Auto Workers, thundered against another large parts supplier, Johnson Controls. He promised to strike Johnson Controls and stop production at GM’s Oshawa assembly complex in Ontario if the supplier proceeded with plans to close an interiors plant in Whitby, Ontario.
I hadn’t heard that tone from an automotive labor leader in at least a decade. Sure enough, Johnson Controls later agreed to keep the plant open with some additional bonuses for workers.
The reality is that the industry is building and selling vehicles as fast as it can. Workers can see the profits being made by the carmakers (not to mention executive salaries).
And they know that this is the best time since the early 2000s to try to recoup some of the concessions given up during the recession. Veteran UAW members at the Detroit 3 have not had a wage increase in 10 years. That means they’ve gone backward vs. inflation.
Two-tier wages have been in the union’s cross hairs. The UAW, which gave rise to it to try to preserve jobs, knows it’s divisive on the factory floor. Ditto for the carmakers.
The Lear agreement puts all workers at the Hammond, Ind., seat plant on a track to eventually earn the same amount of money. Under the old system, the two-tier workers were never going to catch their veteran co-workers. At a maximum of $21.58 an hour, that’s a livable wage that workers at the plant can accept and Lear can afford.
Almost certainly in the Detroit 3-UAW negotiations that begin in earnest in January, something similar will be on the table. Today, about one-fourth of the 130,000 hourly auto workers at the Detroit 3 are two-tier.
The two-tier system involving the UAW started at the large parts suppliers and eventually gravitated to the Detroit 3. Lear and the UAW have ended the experiment in Hammond.
It may portend the beginning of the end of two-tier at the Detroit 3 as well.
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